Repercussions of COVID-19 on the uPVC Doors and Windows Industry

In an exclusive video interview hosted by CONSTRUCTION WORLD, Ashven Datla, Managing Director, NCL Veka, shares more on how the firm is coping with the current pandemic and lockdown, sectors expected to drive demand post-COVID, and more...

Excerpts:

Merger and market share: The merger between NCL and VEKA is about two years old. VEKA is the world's largest exporter of uPVC profiles and NCL was the largest utility profiles manufacturer in India. So it made sense for VEKA to come to India and expand their presence globally. We also had access to VEKA?s brand and technology and their capabilities for manufacturing globally. So, it has been a good experience with the culmination of two market leaders coming together. Since then, we continue to grow our presence in India. We are currently the largest; we continue to be the market leader with a good 16-18 per cent market share in the uPVC profiles segment.

Coping with the lockdown: This has been a difficult unprecedented time, not only for us but pretty much for everybody. Everybody is kind of grappling in the dark and trying to figure out how and what is happening and how to deal with the situation. For us, the focus has always been on the employees ? to make sure their safety is taken care of. Fortunately, from our presence both in India and globally, we have not had any incidents of COVID immortality. That said, I think in India, more than the COVID it is the lockdown that has taken a toll. As we are not into essential services, our factory has been shut for pretty much the last month. More than anything else, I think it is the morale of the employees being impacted, and the focus right now is to get back to work and restart where we left off.

Speaking about the supply chain, fortunately, we have a robust supply chain which constitutes both, imported as well as indigenous product quality standards. So we have multiple suppliers all over France. So we do not see the supply chain as a problem. We also do not see manpower as a challenge because most of our employees stay close to the factory. More than 90 per cent of our workers stay in an employee colony just about half a kilometre from the factory.

Also in terms of production, in the last two years, we have invested a lot on infrastructure. So we have enough capacity going forward. So on capacity side, the supply side and the workforce side, we are good. The area hurting is the demand ? that is where the challenge currently is and where it will continue to be in the immediate future.

Sectors to drive demand: There's a lot of demand going to come in from the medical side both, government and private. What has come out clearly is that India's medical infrastructure is woefully underprepared. I'm hoping that the focus in the next couple of years would be from the medical side. What we are also seeing is that with a lot of industries moving out of China, we are we are looking at a lot of industries now moving into India. The materials required for the pharmaceuticals industry for doors and windows are non-corrosive and easy-to-maintain, so uPVC profiles fits well into the overall segment. While this is a new industry of focus, we also expect demand to come in from government infrastructure, education, etc, that would continue to be the focus, including residential. Pre-COVID, a majority of our products has been used in the residential segment and I believe this will continue. Having said that, we expect some kind of cannibalisation from aluminium windows to uPVC windows in the residential segment. We have seen this trend in the last decade and it will accelerate going forward.

Focus on technology: This is the time when adoption of technology is something that is being hemp. Is it being hastened more as a necessity. We have been using a lot of technologies, for instance, we are using webinars, zoom calls, etc, to connect to people. Besides, we have also used this time to reach out to all our customers and use this as an opportunity to connect to them not only on the business side but also on a personal level.

Time to bounce back: It is difficult to say how long it will take to bounce back. But we have been speaking extensively to a lot of our customers ? builders, architects, etc, and I think once the lockdown is lifted, our discriminator is the demand for ongoing projects which will continue at least for the next couple of months.

Speaking about the lockdown, I think 2.0 was an extension that was not required in my view and it is hurting the business significantly. I sincerely hope the lockdown is lifted as soon as possible. I can't emphasise how drastic impact it will have on the economy if this is allowed to continue for a longer period of time.

Watch the full video to know more on what Ashven Datla has to say on the industry...

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