Fire survival cables to be the new reality

It’s just a matter of educating the end consumer on the benefits of green wires and it’s purely on us to present it in front of them for their perusal.

Shashi Amin, President & SBU Head for Cables at Polycab India Limited, in an interaction with EPR, emphasises on providing quality products to their consumers. Following the increasing safety awareness amongst the customers, fire survival cables will soon be replacing the normal PVC cables in key strategic applications.

How do you view the consumer’s shift towards trusted electrical brands? What is Polycab’s role in developing this trend?
In FY18, 65 percent of the wire and cable business was from the organised sector, i.e., mostly established branded manufacturers, and 35 percent was from the unorganised sector comprised of small manufacturers. Moreover, a lot of spurious materials are also being produced and marketed within the country. However, with the implementation of GST in recent years, most of the unorganised players are slowly shifting towards the organised sector. Steady growth in disposable income has led to a discernible shift in consumer preference towards high-end and technologically superior branded products. As far as Polycab is concerned, we have always believed in the quality of products that we manufacture, and we have done a lot of backward integration to ensure consistent supply of quality raw materials for our products.

As far as duplication and grey market is concerned, sometimes you can’t avoid duplication completely. However, we have taken few advance measures to reduce the number of duplicate products of Polycab in the market. Few years ago, we did testing of some duplicate products in an independent laboratory and found that the properties were different from the original one but had ISI certification.

Real estate is one of the major markets for wires and cables. How do you look at the opportunities in this market?
Polycab is one of the largest players in the space of underground cables and residential cables and wires. Considerably, 55 percent of Polycab’s cables are underground cables whereas 45 percent consists of wires and flexible cables. Three years ago, we decided to spend on ATL activities and we witnessed a considerable number of builders adopting our products. Affordable housing, healthcare and education are the three segments which are expected to drive building construction leading to increased demand for wire and cable.

Also, with increasing awareness about safety, commercial establishments such as hotels, hospitals and malls and luxury housing developers are expected to actively install HFFR cables.

Can you elaborate on your turnkey projects for cable division?
We have our EPC division for executing turnkey projects for cabling. We normally undertake turnkey projects that require substantial cables. We have already completed various such projects in UP, Bihar, Kerala, Ranchi, etc. Currently, we are executing various projects in Maharashtra and Kerala.

What kind of market potential do you foresee for Polycab in low and high voltage cables?
I think we are the only company in India having the widest range of products in cables and wires division, which includes LT/HT/EHV cables, rubber cables, instrumentation cables, electron beam cables, housing wires, flexible cables, automobile cables, marine cables, conductors, aerial bands cables and others. Within the cables segment, low voltage cable has been the most selling item in terms of volume and value for years. However, there has been an increasing demand for medium and high voltage cables for various electrification projects, power generation, infrastructure projects like roads, metros, airports, smart cities, etc. In India, there are about 21-22 players and the competition is limited because a manufacturer needs to have credentials for being in the utilities segment, which usually takes around 5-6 years for new manufacturers to enter the segment.

Growth is expected to be driven by investments in T&D facilities which will drive the demand of high voltage and extra high voltage cables. Government schemes for last mile rural electrification will boost the demand for LT and HT cables. Around 41 GW of new capacity is expected to be added in solar energy and wind energy by FY23. Construction sector, led by infrastructure projects and supported by rail network expansion, urban infrastructure projects like Smart Cities Mission, metro rail, etc. will drive the growth in demand.

Can you brief us about importance and future scope of fire survival cables?
Fire accidents caused an average of 62 deaths per day during 2010 to 2014 as per an NCRB report, with top five states contributing to 53 percent of total deaths due to fire. However, it is not the fire burns but smoke inhalation which is the primary cause of death for victims of fires. Some 50–80 percent of fire deaths are the result of smoke inhalation injuries, including burns to the respiratory system.

Statistical reviews of fire casualties for several decades in the UK and the US show that fire toxicity of smoke is the major cause of death for fire victims. Therefore, it becomes all the more imperative that we educate our customers to help them understand the importance of fire survival cables. FS cables provide great advantages over normal PVC cables with high oxygen index level of 34-36, smoke visibility of >95 percent and toxicity index

What challenges do you face with electrical contractors during procurement?
Usually, the markets buy the cheapest from the upload brand which is nominated for a particular project. So, their choice usually goes by the cost and not by the brand names. What is required is that we need to educate the end customers, i.e., the utilities and the distribution companies. To maintain quality, it is very important to set stringent specifications which might rule out the many players from the unorganised sector. So, contractors do not play a major role here as they will go with the cheapest brand available.

What is IEEMA’s role in mitigating these challenges?
I am the chairman of the Cables and Wires division of IEEMA, and few days ago, we had a meeting on public policy at IEEMA to discuss the methodologies being followed around the world. An example was cited about China which has various parameters to test and verify the capacity, capability and performance of all their produced and manufactured products. Our country must take appropriate measures to incorporate such policies. We are in touch with CEA to understand whether we can incorporate those methodologies in the government sector.

How would you rate your organisation’s presence in the international market?
Last year, we did a business of around ₹250 crore in the international market and bagged an order of ₹950 crore for a refinery project in export which is currently under execution. We are one of the prominent players in the international oil segment and our products are being marketed and distributed in London. We further have operations in Italy and Europe catering to the EPC contractors based out of Europe.

What is your business outlook for the coming years?
As per a CRISIL report on the wires and cables industry, the industry is expected to grow at 15 percent during the period FY18-FY23 and reach a market size of approximately ₹1 trillion by FY23. Despite some flip-flops in the market, we’ve been growing at a rate of approximately 14 percent during the last four years. However, this year, the industry should grow maximum by 4–5 percent, but again I’m reiterating that we remain bullish about the business in the coming years.

How is the coronavirus issue impacting metal prices?
I think it’s difficult to predict the LME prices of any metal. Today, the prices are very low including during the last couple of weeks owing to the coronavirus issue which has been declared as a pandemic by WHO. We are waiting for some relief in the situation when the metal prices would be back to normal or relatable prices. In fact, during December, copper prices peaked at $6,300 whereas now it’s around $4,700. I expect it to stabilise to around the $6,000 mark in due course of time. Tough times are ahead with lockdowns looking imminent and unavoidable to stop the spread of this virus.