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Engineering major Escorts Group’s rail division expects to see a four-fold rise in its annual revenues to ₹1,000 crore by 2020, riding on Indian Railways’ plan to substitute imports of components with locally manufactured products, in line with the Centre’s ‘Make in India’ mission.
In the current fiscal, Escorts’ rail division expects to get ₹250 crore in revenue from the Railways, Dipankar Ghosh, Chief Executive Officer, Escorts Railway Products, told BusinessLine . In 2014-15, the division had clocked revenue of ₹184 crore. Ghosh is a former Indian Railways electrical officer.
The company is also expanding its product portfolio with an eye to supply more components for the Railways as well as Metro systems, including those in Kochi and Lucknow.
High-end techAdditionally, Escorts is looking at supplying locally manufactured products at a cheaper price to the company from which it obtains technology.
“We are bringing high-end technologies. We were conducting field trials for these products in the past two years. We focussed on components that were not being made in India.
“All of these have a built-in buyback programme….even technology partners are seeing a cost benefit of 30-40 per cent on land costs. I cannot name the companies now, but Germany, Korea and Australia are the countries where we have entered into buy-back programmes,” he said.
Component focusGhosh said about 60 per cent of the value of the coaches are accounted for by other components. Axle-mounted disc brakes, bogie-mounted brake systems and door systems for Metros are some of the component areas Escorts has ventured into.
“We are focussing on components such as brake systems for wagons, coaches and locomotives, coupling and suspension systems,” he said.
For now, the company is expanding its existing plant in Faridabad to manufacture components.
“Additionally, the Railways has already invited tenders for brake systems required for running trains at 200 km/hour. This is another area where business will expand,” Ghosh said.
As more and more freight trains from the Railways network shift to the dedicated freight corridor after 2018, a lot of line capacity on the existing network will become free.
This will help the Railways run passenger trains at higher speeds, he added.
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