Having seen his firm, Hindustan Construction Co. Ltd., grow tenfold in the last seven years, Chairman and Managing Director Ajit Gulabchand forecasts continuing expansion in infrastructure construction for a decade or more. As he looks forward to increasing business for the rest of his career, his problem is mainly acquiring good, qualified people to handle the work.
While Gulabchand is relaxed about finding engineers, even by importing them, he is more concerned about a dearth of skilled labor. Labor productivity in India is one-twentieth that of the U.S., he reports. He says he is lobbying the government to support training, but that burden is left totally on contractors.
|Large Jobs. HCC depends on heavy civil work.|
Despite difficulties in finding human resources for HCCs burgeoning home market, Gulabchand still wants to expand business outside South Asia to about 30% of the total, he says. He is targeting the Middle East, but also Asia and the former U.S.S.R. "We need to have a global presence," if only to get exposure to best international practices, he says.
Gulabchand is a nephew of the 80-year-old companys founder. Since a corporate split in 1994, he acquired over half the construction units stock, with the rest being distributed mainly among individual shareholders, and also institutions.
"In heavy civil engineering, we are the first [in India]," claims Gulabchand. Unlike Larsen & Toubro, he focuses only on large infrastructure projects. HCC is Asias largest dam builder outside Japan, also with 300 bridges, 600 kilometers of highways and nuclear powerplants among its credits. "Ideally, we would have 20 to 25 or a maximum 35 contracts," he says.
With annual sales of about $345 million, HCC falls into the second rank of Indian contractors. But like other contractors, the company is growing fast, reporting a 35% rise in revenue last year, more than doubling profit, to $16 million.
(Photo top by Peter Reina for ENR, bottom courtesy of Hindustan Construction Co.)