International BusinessRitchie Bros to invest $100 million in India
Ritchie Bros Auctioneers, a Canada-based industrial auctioneer, is formalising plans to make an incremental investment of $100 million (approximately Rs 490 crore) for setting up six permanent industrial equipment auction sites in various cities across India over the next five years.
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“We have recently leased a 20-acre site at Shamshabad on the city outskirts to put up equipment for auction. Once we have a business of $20 million (Rs 98 crore) from multiple-auctions at this location, we will establish a permanent site in Hyderabad on 80 acre, which will house close to 5,000 equipment, in two years from now.
This will be followed by similar sites in Mumbai, Delhi, Kolkata, Chennai and Bangalore,” Guylain Turgeon, managing director (Asia, West Asia and Europe) of Ritchie, told Business Standard.
Turgeon said the global market for trade of construction, transportation and agriculture equipment was estimated at $100 billion a year and Ritchie was ready to grow in India now.
India is very high on the priority list of the over $3.5-billion NYSE-listed company, which has 38 permanent auction sites globally, he said adding the initial market that the company was targeting was the booming construction sector in the country.
“The equipment market in India is changing rapidly with the volumes sold growing five-fold from 10,000 units five years ago. Of late, the behaviour of the end users in India too has changed and the players are now renewing their fleet every 2 years as against 15 years earlier. We see this as an opportunity and are targeting at least one per cent of the Rs 50,000-crore worth of equipment that is currently plying in India,” he added.
Ritchie Bros will be conducting its first unreserved equipment auction in India at Hyderabad on September 25, 2009, which would see cranes, hydraulic excavators, wheel loaders, crawler tractors and dump trucks coming under the hammer.
“Hyderabad is hub of construction activity and given the fact that 25 per cent of the equipment in India is sold to Hyderabad players, we are making our beginning from a right place. We are expecting to garner $5 million (Rs 24.5 crore) through the auction of 300 equipment here,” Turgeon said.