As far as Cummins was concerned, they had a rental business in India but it was not their thrust as they are more into manufacturing. In India, they wanted to exit rental business so we acquired it. It was a win-win situation for us because Cummins is our partner globally for supplying the genset engines. We have been having a very good response from the Indian market. When we acquired Cummins business, the utilization which is our key metrics for measuring business was at 43 per cent and today it is at 80 per cent. It shows how much growth is in the market and customers are accepting our products. To focus on project side (anything between 5-10 mw), we have moved from Dubai to India. As you have seen in Aggreko International, it is our co-segment and we expect it to be a big business in India too. As of now, we are building the base for it with lots of enquiries going on. Typically, a project business has a longer gestation period of 6-12 months to mature. There are lots of projects we are working on and hope to close it within 2-3 months time to get some business. We have been in discussion with Commonwealth on projects side.

What has been your growth globally?
Globally, our business has been growing in double digit. Now, our thrust is on Asia as it has been a weak point for Aggreko in terms of expansion. With the formation of a new global unit in Singapore, Asia, (earlier under Jebel Ali) there is a big potential in Asia, Africa and South America.

What have been the recent trends in the gensets?
There is more demand for higher size machines from the industries and bigger projects which looks for higher scale of production. We are now looking at 1-1.2-mw units. As gas is cheaper than diesel, it is picking up a lot. At present, most of our gensets in India run on diesel.

Gail (India) is taking initiative in laying gas pipelines and Gujarat has been moving very fast on it. In NCR and north side, as lot of gas pipelines are laid we are getting many enquiries on it. In the next two years, we expect south to participate in this program.

One of our pilot projects being done two years ago is using waste gas generated from ONGC to generate power, which we are trying to expand now. We have been able to work with Cummins in terms of providing a solution for the gas they used in cleaning by recovering that gas & generate power.

How do you assess the Indian market?
The Indian market is worth around Rs.550 crore and it is growing at 30 per cent year-on-year. Last year, Aggreko did business worth Rs.16 crore and this year, we expect it to grow by Rs.30 crore.

What is your current order book?
We are full at this moment with 80 per cent utilization.

What about your expansion plans in India?
We will be setting up depots in Delhi, Chennai and Kolkata. We are in talks for Mumbai depot but till that time Pune depot will be serving that market. The commissioning of Chennai will be by October, Delhi by December and Kolkata by the first quarter of 2011. We have 100 mw in Pune and other depots will be at same capacity. The replacement of old machines from Cummins and adding new ones will also double the capacity. We are working for Shriram Industries, Cairn Energy, Amara Raja Batteries, Nirmal Life Style, McDonalds and couple of major players we are expecting to come up. If we surpass Commonwealth Games then it will double our business.

What do you see as your demand drivers?
Our business is strong in the south and north. Most of our business today is driven by manufacturing sector. In India, we are only into power and in the coming years will be looking forward to start temperature business. The utilities and project business have a lot of potential but it will come after 6-12 months. We are looking at oil and gas, infrastructure, mining, chemical and any process industry which needs high power. Gas is another option which we are looking forward to. We have already started 1-2 gas engines on hire but more are available.

What business hurdles to you typically face?
In terms of hurdles, we are facing the mindset of the people, which is: "owning rather than renting." They are not really able to utilize the equipment in the right way. In India, power is not sold at the right price because the government has subsidized it. Lot of utility companies are not able to purchase power because their revenues are not so high. Those are few things which are affecting from the growth point of view. Secondly, the import duty is high which affects our pricingand we end up paying 25-30 per cent on imported equipment. Ultimately, customers are affected. Even skilled man power is scarce. We will train people in Aggreko in the long term.

Do you think power generating companies are profitable?
Yes, and there is a lot of scope for it in short-and-long-term. The demand of power is expected to continuously grow in India. As per the XII Five Year plan, we need to add 430 mw every 14 days into our country to close the gap.

What industry issues could the government address?
We are looking for uniform goods and services tax (GST) and valueadded tax (VAT), and exemption on import and excise duty. On the gas side, if government can provide subsidizes which can make us competitive with utilities that could help us.

Do you face competition from local players?
Local player could perhaps come at cheaper rates but with regards to reliability, quality and solutions, they can't fulfill those conditions. As far as understanding the nerve of the market is concerned, though we are a global company we want to act as a local company. We need to understand what are the market demands, what it is looking for and how can we provide it. We have seen clients coming back to us for more solutions. So they (local companies) are not a threat to us.

How you make your product energy efficient?
An engine produces a lot of power and energy is wasted in terms of exhaust gas. We make an energy-efficient product by using the heat sent through exhaust to create heat recovery in terms of boiler to produce steam or in chillers for air conditioning. Thus, heat wasted in environment is regulated. If you replace diesel with gas engines, 20- 30 per cent of cost is saved.

What would be your guiding principles for the Indian business?
As we had a recession already, one has to have long term view in capital investment and how to recover it. Pricing war will hurt if you copy anyone. You should consider what different players are providing and how my product differs from others. Today, in India, our major competitors are genset manufacturers and not local rental solutions.