In what could be seen as the likelihood of continued slowdown in private investment in manufacturing sector, Siemens has said it would bank mostly upon public sector investments in power and railways with private sector capital expenditure getting deferred, according to its annual report for the year ending September 2015.
"Looking ahead, with private sector capital expenditure getting deferred, the growth drivers for the company clearly lie in increased public sector investments in power generation, distribution," chairman Deepak Parekh said in his address.
"Economy continues to witness sub-par growth with the capex cycle clearly awaiting more policy actions from the government before taking forward its investment decisions," the noted banker said, adding that the majority-owned subsidiary of Siemens AG is awaiting opportunities in the form of large tenders for ultra mega power projects, metro railways, electric multiple unit locomotives or passenger train coaches and also orders for high-voltage direct current solutions.
Siemens AG is a global technology powerhouse operating in core business segments of energy, railways, healthcare, infrastructure and cities through its business divisions.
With private sector orders yet to revive, there is stiff competition to grab government orders driving down margins.
"The company's strategy is focused on three aspects: profitable growth in new orders, selective participation in large orders with profitability being the key driver and continued focus on operational excellence and cash," Parekh said.
The Indian subsidiary has already got approval for such a strategy from the managing Board of its global parent which earlier visited India.
Among opportunities, Siemens is looking at projects like Smart City and modernisation of the Railways.
For smart cities, Siemens formed a consortium with nine other companies and two banks to address the needs of cities and has signed an MoU with IL&FS and Gujarat International Finance Tec-city (GIFT City) to develop smart mobility solutions for the upcoming finance city.
"With the thrust being put by the government on smart cities, we are confident that Siemens is well positioned to address this very important market."
The energy management division is partnering with Power Grid Corp for upgrading the national grid from 765kV to 1200kV. It also received orders to supply gas insulated switchgear substations.
In addition, the division is supporting various State Power Distribution companies in modernising their infrastructure by implementing smart grid technology using SCADA (Supervisory Control and Data Acquisition)and DMS (Distribution Management System).
The power and gas division tried hard to maintain its market share position as new capex been put on hold while public sector tenders were not announced.
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