OFF HIGHWAY DUMP TRUCKS: INDIA

MARKET & OPPORTUNITIES

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 CONTENTS

I. INTRODUCTION 3
II. SUMMARY 3
III. EQUIPMENT EDUCATION 4
A. DUMP TRUCKS HIERARCHY 5
B. STD DUMP TRUCK 6
C. RIGID OFF HIGHWAY DUMP TRUCK 7
D. ARTICULATED DUMP TRUCK 8
E. MINING TRUCK 9
IV. ECONOMIC TRENDS
A. MINERAL RESOURCES IN INDIA 10
B. BREAK UP OF SECTOR 11
C. LOCATIONS OF INDUSTRY RELEVANT MINES 11
D. MINERAL PRODUCTION 11
E. MINING CAPEX 12
F. COAL INDIA PROJECTION OF PRODUCTION, DEMAND AND SHORTFALL 14
V. MARKET TRENDS
A. COAL INDIA PROJECTION OF ESTIMATED DUMPER REQUIREMENT 15
B. BEML ESTIMATE – PROJECTED ,MARKET DEMAND FOR DUMPERS 17
VI. SALES 19
VII. PRICING 20
VIII. TECHNOLOGY 20
IX. PRODUCTION 21
X. COMPONENT SOURCING 24
XI. FOREIGN TRADE 24
XII. MARKET SHARES 24
XIII. DISTRIBUTION AND MARKETING 25
XIV. SWOT ANALYSIS 30
XV. ANNEXURE I
A. INDIA: OFF HIGHWAY DUMPER MODELS 33
XVI. ANNEXURE II
A. INDIA: OFF HIGHWAY DUMPERS COMPARISON : 30 TO 35 TONNE PAYLOAD CLASS 34

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INTRODUCTION

This report examines the Indian market for Off Highway Dumpers. Although there are a wide range of
machines with payload capacities ranging from 25 T (Metric Units) to 362 T, the most popular models
currently in India are in the range between 30 T and 50 T. These models traditionally comprise 6 to 12
cylinders, 235 KW to 510 KW Turbocharged Cummins Diesel engines or proprietary engines as in the case of
Caterpillar and Komatsu. They also feature either Allison make or Proprietary Transmissions, with 5 to 7
forward gears and 1 reverse gear. Other common features are fully floating axles, a 30% gradeability, and a
3 stage telescopic hoist for dumping. Although this is the most popular category in India currently, the demand
for machines with higher Tonnage and AC/DC drives, is steadily growing.

SUMMARY

India: Summary of Off Highway Dumpers,*

BEML, Caterpillar, L&T Komatsu, Telcon, Voltas,

2009 Number of Suppliers 7
Tatra , Volvo
Number of Joint Ventures 2 L&T Komatsu, Telcon – Hitachi Euclid
Market Leader BEML -----
BEML Market Share 70 - 80 % -----
BEML Sales (Units) ---- To be Sourced
BEML Population (Units) ---- To Be Sourced
Est. Market Size 2008-09 (Units) 825 ----

Demand Forecast 2012-13 (Units) 930 ----

* Source : Unverified Publications and presentations

The history of the off highway truck in India stretches back to 1964, with the setting up of Bharat Earthmovers
Ltd. (BEML), a public sector unit of the Ministry of Defence, at Kolar in South India, to manufacture, amongst
other equipment, dumpers, under license from Komatsu, Japan. Subsequently, in the private sector, the
Hindustan Motors’ Earthmoving Equipment Division, was established in 1969 at Tiruvallur, near Chennai with
technical collaboration from Terex, UK for the manufacture of dumpers. This factory has since been taken
over by Caterpillar in 2001 for their Indian operations. The market has traditionally been dominated by these
two manufacturers, jointly accounting for 90 per cent of sales.

There are other players too in this product category, such as TELCON, L&T Komatsu, Tatra, Volvo and
Voltas. Telcon has a Joint Venture with Hitachi – Euclid for their range of dumpers, and L&T with Komatsu.

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Applications for Off Highway Dumpers are strictly confined to mines. Government regulations do not permit
their usage outside the designated area. This is as opposed to Tippers, also colloquially referred to as
dumpers, which are used for load hauling within mines and also outside the designated mining area. A
majority of both off highway dumpers and tippers, are deployed at coal mines and the balance at Iron Ore,
Bauxite and areas of other ore sources.

Demand for Off Highway Dumpers, over the past nine years has grown from a modest 200 units in FY
2000 to a projected demand of 930 units for FY 2012- 13, indicating an over 4 fold growth. The future trend,
according to various industry forecasts, is skewed towards machines with higher payload capacities of a
minimum of 50 T and above. No doubt, the current regressive economic scenario will suppress demand and
the forecast has to be adjusted as deemed necessary.

On a positive side, a majority of the demand for Mining Equipment in India originates from Coal India Ltd. at
almost 80% according to various sources. Coal India though, has projected a significant increase in
production over the next decade. Currently all of Coal India’s production is consumed domestically, and even
requiring imports to meet the domestic requirement. Hence irrespective of the dampened economic scenario,
Coal India’s projection of increased production is likely to hold good and their demand for equipment will be
the barometer for the mining equipment industry.

EQUIPMENT EDUCATION

Before we progress further, let us understand what a dump truck is and where it is positioned among the
myriad models in the industry.

A. History

The dump truck was first conceived in Saint John, New Brunswick when Robert T. Mawhinney attached a
dump box to a flat bed truck in 1920. The lifting device was a winch attached to a cable that fed over a pulley
mounted on a mast behind the cab. The cable was connected to the lower front end of the wooden dump box
which was attached by a pivot at the back of the truck frame. The operator turned a crank to raise and lower
the box. Today, virtually all dump trucks operate by hydraulics and they come in a variety of configurations,
and are classified accordingly.
Classification of commercial vehicles is is carried out on the basis of Gross Vehicle Weight.

Gross Vehicle Weight ( G.V.W) = Unladen Weight + Payload

Unladen Weight : Weight of the empty unit, including Motor oils, fuels etc.
Payload : Weight of the Cargo alone
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 DUMP TRUCKS

STANDARD DUMP TRUCK LOAD HAUL TRUCKS

SINGLE AXLE
G.V.W ≤ 16 T

ARTICULATED
RIGID
TANDEM & MULTI AXLE (Payload Tonnage)
G.V.W ≤ 31 T
24 T

28 T

33 T
OFF HIGHWAY DUMPERS MINING TRUCKS
(Payload Tonnage) (Payload Tonnage) 38 T

39 T

25 -35 T 109 T
40 T 136 T
45 T 154 – 172 T
G.V.W = UNLADEN WEIGHT + PAYLOAD
50 T 172 – 186 T
55 T 218 T
= XXXXXXX RANGE (20, 30, 52 T)
60 T 236 T
63.5 T 245 T
70 T 326 T
85 T 362 T
90 T

100 T

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STANDARD DUMP TRUCK

A standard dump truck is a full truck chassis with a dump body mounted to the frame. The dump body is
raised by a hydraulic ram mounted behind the the front bulkhead, between the truck cab (traction unit) and the
dump body (semi-trailer). The tailgate can be configured to swing on hinges or it can be configured in the
"High Lift Tailgate" format wherein pneumatic rams lift the gate open and up above the dump body. A standard
dump truck has one front axle, and one or more rear axles which typically have dual wheels on each side.
Common configurations for a standard dump truck include the six wheeler which has one rear axle, the ten
wheeler with two rear axles, and the tri-axle with three rear axles. The intermediate axles are present to
support the weigh over the length of the chassis and sometimes to provide additional braking power.

There are various suppliers of these Standard Dump

Trucks in India. They are
1. Tata
2. Ashok Leyland
3. Asia Motor Works ( AMW)
4. Tatra Trucks
5. L&T Scania
6. Volvo
7. Mercedes
8. Eicher Motors
9. Man Force

Traditionally, in India, these standard dump trucks are referred to as “Tippers”.

Tippers may be classified as follows:

1. Single Axle ( 1 Front + 1 Rear axle)

G.V.W ≤ 16 T (~9 T of Payload. Practically upto 22 T)

Although the indicated GVW should not exceed 16 T, which

implies a payload of approximately 9 T, for all practical
purposes, the vehicles are overloaded to carry payload
capacities alone of 22 T.

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 2. Tandem Axle & Multi Axle ( 1 Front + 2 or More Rear Axles)

G.V.W ≤ 25 – 31 T (~ 16t Payload. Practically upto 40 T)

Although the indicated GVW should not exceed 31 T,

which implies a payload of approximately 16 T, for all
practical purposes, the vehicles are overloaded to
carry payload capacities alone of 40 T.

RIGID OFF- HIGHWAY DUMPTRUCK

Off-road dump trucks more closely

resemble heavy engineering vehicles
than they do highway dump trucks.
They are used strictly off-road for
mining and heavy dirt hauling jobs. As
the payload is unloaded from the rear,
they are referred to as “Rear Dump
Trucks” . They have payload
capacities between 20 T and 360 T.

The following are the suppliers of Rigid Off Highway Dump Trucks in India

1. BEML
2. Caterpillar
3. HM ( Still available under “HM” Brand, but produced by CAT)
4. Telcon
5. L&T Komatsu
6. Voltas
7. Tatra Vectra Trucks

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ARTICULATED DUMP TRUCKS

An articulated dump truck has a hinge between the cab and the dump box, but is distinct from semi trailer
trucks in that the cab is a permanent fixture, not a separable vehicle. Steering is accomplished via hydraulic
rams that pivot the entire cab, rather than rack and pinion steering on the front axle. This vehicle is highly
adaptable to rough terrain. Only articulated dump trucks can operate in water logged areas. This is usually the
case when the mine depth goes below Mean Sea Level. In line with its use in rough terrain longer distances
and overly flat surfaces tend to cause driveline troubles, and failures.

The following are the suppliers of Articulated Dump Trucks in India

1. Caterpillar
2. Volvo
3. Komatsu

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MINING TRUCK

A mining truck is a larger version of the rigid dump truck with payload capacities of 100 to 400 tonnes. As
opposed to the rigid dump trucks , mining trucks are powered by diesel engines to drive generator , which in
turn power individual AC / DC motors at each wheel.

The following are the suppliers of Mining Trucks in India

1. BEML
2. Caterpillar
3. Voltas
4. L&T Komatsu

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ECONOMIC TRENDS

The global financial crisis is quite visibly having an impact on India’s industrial sector. Export growth dropped
Sharply in November 2008 to -10.42% from 12.2% y-o-y in the preceding month, as Indian exporters
faced a sharp decline in demand from overseas buyers. A number of companies have since reined
in their production plans as export orders have plunged.

However, despite falling commodity prices, India’s mining sector is continuing to post strong
Growth, driven by strong domestic demand. Between 2008 - 2013, BMI Market Research forecasts that the
sector will grow by a compound annual growth rate of 9.75% reaching a total value of US$47.12bn. This
represents 2.6% of GDP, however, the country is still not exploiting its true potential and needs to
improve productivity and invest in exploration and infrastructure.

MINERAL RESOURCES IN INDIA

India is endowed with significant mineral resources and the mineral industry constitutes an important segment
of the Indian economy. India produces 89 minerals which include 4 fuel, 11 metallic, 52 non-metallic and 22
minor minerals. Globally, the country is the largest producer of Sheet mica, the third largest producer of coal,
the fourth largest producer of iron ore and the fifth largest producer of bauxite. Besides these natural
resources, India also hosts significant reserves of copper, zinc, gold and about 26 other metallic and minor
minerals.

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BREAK UP OF SECTOR

The Indian mineral sector represents a unique blend of small scale and large scale mining operations. In spite
of large-scale mining operations, India is essentially a country of small-scale mining, since as much as 87% of
the operations can be considered as small scale. India has 2326 private and 292 public sector mines. Over 80
percent of the mining activities in India are in coal.

Table 3 : Locations of Industry relevant mines

Coal Tamil Nadu, Chhatisgarh, Maharashtra, Orissa, West Bengal and Andhra Pradesh
Andhra Pradesh, Bihar, Goa, Karnataka, Madhya Pradesh, Maharashtra, Orissa,
Iron Ore
Rajasthan
Bauxite Orissa, Andhra Pradesh, Madhya Pradesh, Gujarat, Maharashtra
Chromite Byrapur, Karnataka, Boula, Kathpal, and Orissa
Copper Ore Madhya Pradesh, Rajasthan, Bihar and Sikkim
Andhra Pradesh, Bihar, Gujarat, Karnataka, Kerala, Madhya Pradesh,
Granite
Maharashtra, Meghalaya, Orissa, Rajasthan, Tamil Nadu, Uttar
Rajasthan, Andhra Pradesh, Bihar, Gujarat, Maharashtra, Sikkim, Tamil Nadu,
Lead and Zinc Ore
Uttar Pradesh
Madhya Pradesh, Goa, Maharashtra, Andhra Pradesh, Bihar, Gujarat, West Bengal
Manganese Ore
and Karnataka

MINERAL PRODUCTION

Table 4 : Mineral Production in India

Million Tonnes
Mineral 2002 -03 2003 - 04 2004 - 05 2005 - 06 2007 – 07

Coal 341 361 383 407 430

Iron Ore 99 121 146 154 172

Bauxite 9.86 10.95 11.96 12.33 13.07

Chromite 3.06 3.2 3.62 3.42 4.1

Copper 0.152 0.143 0.137 0.124 0.115

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As is evident from the above tables , Coal is the most important and abundant / mined reserve in India, with
the country ranking third in worldwide production. Coal accounts for around sixty percent of the country's
energy need, with reserves being estimated by the Geological Hard coal deposits, spread over 27 major
coalfields, are mainly confined to the eastern and south central parts of India. India has a potential coal-
bearing area of about 22,400 sq.kilometers, of which only about 45 percent has been partially explored.

MINING CAPEX

Large capacity additions planned in Power, Steel, Aluminium and Cement, implies large demand for coal, iron
ore and bauxite. Consequently, industry sources believe mining capex is likely to rise sharply – primarily in
coal and iron ore. India’s coal consumption was 460MT in FY07, while domestic production was only
432.5MT. Remaining 27.5MT of demand was met through imports. Ministry of Coal has estimated domestic
coal demand to touch 731.1MT by FY2012 – implying CAGR of 9.7% in domestic demand. In contrast, CAGR
in coal production was 2.53% during the 9th plan (FY1997-2002) and 5.7% during the 10th plan (2002-07).
Coal Ministry targets CAGR of 9.47% in coal production during the 11th plan – i.e. from 432.5MT in FY07 to
680MT in FY2012.

“The bottleneck in coal production is not availability of coal reserves (which is estimated to be 216 BT), but
availability of mining capacity”

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Industry sources believe just the coal mining sector could see capex of more than US$7-9bn over the next five
years. In addition to increasing the productivity of existing mines and setting up new mines, new coal blocks
are likely to be awarded to private and public sector companies in power, steel and aluminium.

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Table 5 : COAL INDIA LTD PROJECTION OF PRODUCTION, DEMAND, SHORTFALL

YEAR
PARTICULARS
2011 - 12 2016 - 17
COKING 27.65 35.00
PRODUCTION NON COKING 652.35 1020.00
TOTAL 680.00 1055.00
COKING 68.50 105.00
DEMAND NON COKING 662.60 1020.00
TOTAL 731.10 1125.00
COKING 40.85 70.00
SHORT FALL NON COKING 10.25 ---
TOTAL 51.10 70.00

GRAPHICAL REPRESENTATION OF PRODUCTION ESTIMATE

ESTIMATED COAL PRODUCTION (Mill Tonnes)

1200.00

1000.00

800.00
PRODUCTION

600.00 COKING
NON COKING
400.00
TOTAL
200.00

0.00
2011 - 12 2016 - 17
YEAR

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MARKET TRENDS

The Indian market for mining and mineral processing equipment is estimated at $ 2.2 billion. Around 80
percent of this is estimated to be in the coal mining sector. CIL is the biggest buyer of mining equipment in the
country and has had a dominant influence on the development of the mining equipment industry. It has
spearheaded adoption of innovative procurement and maintenance practices in the country. Increased mining
activity at Coal India coupled with replacement demand for aged heavy engineering and mining machinery is
expected to boost demand for mining equipment. The $60 billion anticipated investment in power generation
between 2007-2012 is expected to create significant market opportunity for mining and material handling
equipment providers. Ten per cent of the cost of setting up of new thermal power plant is material handling
equipment. The Coal Ministry estimates that an investment of $21 billion in opencast mining and $5 billion in
underground mining will be required to attain the target production level by 2025.

COAL INDIA LTD. PROJECTION OF ESTIMATED DUMPER REQUIREMENT

YEAR % INCREASE
PAYLOAD 2007 - 08
2011 - 12 2016 - 17 2011 - 12 2016 – 17
(Existing)
240 T 0 55 95 55 73
170 T 35 125 250 257 100
120/110 T 260 400 600 54 50
< 110 T 2945 2975 2975 1 0

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As is evident from Coal India’s projected Off Highway Dumper population, it is worthwhile to note that,
although a majority of Coal India’s Dumpers lie in the below 110 T category, they intend to gradually phase
out further purchases of dumpers in this category. Purchases of Dumpers in all categories above 110 T,
though significantly increase year on year.

This can be visually represented as below.

PAYLOAD COMPOSITION Vs. YEAR – COAL INDIA LTD ESTIMATE

100%
90%
80%
70%
60% < 110 T

50% 120/110 T

40% 170 T
30% 240 T
20%
10%
0%
2007 - 08 (Existing) 2011 - 12 2016 - 17
`

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BEML’s market research data though indicates that segment in the 50 T to 60 T category will witness the
most growth. Contrary to Coal india’s estimate, BEML’s estimate indicates that the although the category in
the 35 T – 40 T segment is not likely to grow, the demand for similar nos. of units is expected to remain over
the years.

PROJECTED MARKET DEMAND FOR DUMPERS – BEML ESTIMATE

2008 - 09 2009 – 10 2010 – 11

EQUIPMENT NON NON NON
COAL TOTAL COAL TOTAL COAL TOTAL
COAL COAL COAL
PAYLOAD
35 - 40 TON 175 150 325 150 150 300 150.0 150 300
50 - 60 TON 150 75 225 175 100 275 200.0 100 300
85 - 100 TON 120 30 150 120 40 160 150.0 50 200
170 - 240 TON 30 0 30 25 10 35 30 10 40
TOTAL 475 255 730 470 300 770 530 310 840

2011 - 12 2012 – 13
EQUIPMENT NON NON Grand Total Average / Yr
COAL TOTAL COAL TOTAL
COAL COAL
DUMPERS
35 - 40 TON 150.0 150 300 175 150 325 1550 310
50 - 60 TON 200.0 125 325 225 150 375 1500 300
85 - 100 TON 150 50 200 150 50 200 910 182
170 - 240 TON 30 5 35 30 0 30 170 34
TOTAL 530 330 860 580 350 930 4130 826

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 CONSOLIDATED PROJECTED MARKET DEMAND – BEML ESTIMATE

YEAR % CHANGE
PAYLOAD 2008-09 2009-10 2010-11 2011-12 2012-13 2009-10 2010-11 2011-12 2012-13
35-40 T 325 300 300.0 300 325 -8 0 0 8
50-60 T 225 275 300.0 325 375 22 9 8 15
85-100 T 150 160 200.0 200 200 7 25 0 0
170-240 T 30 35 40.0 35 30 17 14 -13 -14

DUMPER MARKET REQUIREMENT TREND – BEML FORECAST

400

350

300

250 35-40 T
UNITS

200 50-60 T
85-100 T
150
170-240 T
100

50

0
2008-09 2009-10 2010-11 2011-12 2012-13

In recent years, mining companies have been off-loading excavation work to private contractors leading to the
development of a new segment in mining. The Government of India is actively considering privatisation of coal
mining to give a boost to power generation. This development is expected to stimulate demand for mining
machinery. Mining in India has been kept as a government undertaking since 1950s. In the last few years,
however, the economy has been liberalized, tariffs lowered, state enterprises privatized and the country
opened to investment in mineral exploration. There is a need for upgraded equipment and technology in many
of India's mines and modernization is underway, particularly in the coal sector.

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SALES

Off highway research indicates the following projections for equipment demand by end 2009. In view of the
slackening demand world over the forecasts for 2999, are based on a reduced growth rate of 12 % in the
construction equipments industry.
,
Year wise sales

India Sales of Construction Equipment, 2007-2009 (Units)

% Change
2007 2008* 2009*
2007 - 2008* 2008*-2009*
ASPHALT FINISHERS 954 1040 1150 9 11
BACKHOE LOADERS 21761 16500 18000 -24 9
COMPACTION EQUIPMENT 3219 3225 3600 0 12
CRAWLER DOZERS 627 700 775 12 11
CRAWLER EXCAVATORS 9606 9700 11500 1 19
MOBILE COMPRESSORS 2670 3150 3400 18 8
MOBILE CRANES 8115 8400 9200 4 10
MOTORGRADERS 544 500 550 -8 10
RIGID DUMP TRUCKS 594 825 975 39 18
SKID STEER LOADERS 215 400 450 86 13
WHEELED LOADERS 2386 2700 3200 13 19
OTHERS 57 60 80 5 33
Total Construction
50748 47200 52880 -7 12
Equipment
* Forecast
** Articulated Dump Trucks; Crawler Loaders; Mini Excavators; Rough Terrain Lift Trucks; Wheeled
Excavators
Source: Off Highway Research

Individual sales of Off Highway Dumpers by the various suppliers is to be sourced.

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PRICING

The pricing provided below is only for reference and is not based on verifiable sources. Efforts are in progress
to obtain the data
Price Excise
Off Highway Dumper Model Payload CST / VAT
(Ex Works) Duty
RIGID
84 Lakhs 8.24% CST @ 2 % with Form C, Else
BH 35 -2 31.5 Mt VAT @ 4 %
 BEML CST @ 2 % with Form C, Else
BH 50 M 54.5 Mt 165 Lakhs 8.24% VAT @ 4 %
CST @ 2 % with Form C, Else
 HM HM 1035 33 Mt 75 Lakhs 8.24% VAT @ 4 %
CST @ 2 % with Form C, Else
 CAT 773 58 Mt 180 Lakhs VAT @ 4 %
 KOMATSU
 TELCON
ARTICULATED
 CAT
 VOLVO A35 E 200 Lakhs*
100 - 130
 KOMATSU lakhs*

*Unverified

TECHNOLOGY

Off highway dumper technology has progressed rapidly since the first models introduced by BEML in the early
1960’s. High payload capacity machines though, did not find a large market requirement as their demand is
directly proportional to the GDP of the country. Since then, India’s Industrial output has grown in leaps and
bounds post the economic liberalization regime of the 1990’s. An Increased demand from the Indian
consumer for Power, Cement, and Steel has forced the country’s mining behemoths to augment output
substantially. This set in motion, a flurry of activity amongst mining equipment solution providers to satiate the
demand for larger, and technologically advanced Mining equipment. Amongst the various suppliers of Off
Highway Dumpers in the Indian market, BEML alone has been charged with the task of indigenous technology
development. Other manufacturers in India such as Caterpillar India, Komatsu India & Tatra Udyog, have
access to in house technology developed at their parent companies. Voltas imports the completely built Unit
Rig from Terex. Telcon has access to technology through it’s joint venture partner, Hitachi – Euclid.

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BEML

BEML, is the second largest manufacturer of earthmoving equipment in Asia. The PSU had initially begun
producing Dumpers under an agreement with Komatsu, Japan. Following Komatsu’s withdrawal from the
same at a later period, BEML signed a memorandum of understanding with Terex Corporation during April
2008 for technical assistance to manufacture the heavy duty dumpers, which will cater to the mining sector in
the country and abroad. This alliance brings AC Drive technology for haulage trucks

BEML has already invested around Rs. 10 crore to establish the unit in its Mysore complex which is set for
expansion with an additional investment of Rs. 35 crore. The Mysore complex already manufactures dumpers
of 35 tonnes to 120 tonnes capacity. The Terex agreement will enable BEML to manufacture Dumpers upto
360 Tonnes. BEML claims that this is the first time that any manufacturing unit in Asia will produce a 360-
tonne capacity dumper.

With this technology transfer BEML will also manufacture critical components for the heavy-duty dumpers. As
preferred supplier to heavy users of its equipment to CIL and other customers, the firm will aim to leverage its
expertise in manufacturing a whole range of high-end mining and construction equipment for public and
private sector firms.

PRODUCTION

BEML

BEML is expanding its current production capacity by investing Rs.418 Crores during 2008-09 & 2009-10.
BEML will have an installed capacity to manufacture 1400 Mining Equipment and around 2000 Nos.
construction equipment by year 2010-11.

KOMATSU

Paid-in capital : INR745 million (Approx. JPY2 billion)

Equity : 100% by Komatsu Ltd.
Location : Oragadam SIPCOT Industrial park, near Chennai (formerly Madras), India
Land area : Approx. 240,000 square meters
Building area : Approx. 10,000 square meters

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No. of employees : 63 (as of March 28, 2007), Over 100 (planned for March 31, 2008)
Investment : Approx. INR 70 Cr for the initial phase (incl. land, buildings and machinery)
Products : Off-highway dump trucks
Production capacity : 200 units per year

In addition to Komatsu’s alliance with L&T, for the manufacturing and distribution of excavators and other
Heavy earth moving equipment, Komatsu has established a Plant at Chennai in January 2007, solely for the
production of Off Highway Dumpers. It is located at Oragadam SIPCOT Industrial park, near Chennai The
facility occupies a building area of approximately 10,000 square meters on approximately 240,000 square
meters of land area, involving a Rs 50 crore investment. It has a production capacity of 200 units per year.
Most of the components will come from its 100 per cent owner, Komatsu of Japan

Komatsu India's plant shares the basic design concepts with the Ibaraki Plant in Japan, which also opened in
January this year, featuring a simple assembly line configuration and assembly instruction display system,
among others. By making the production processes "visible" at the plants, Komatsu has established a solid
quality assurance system.

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CATERPILLAR

CATERPILLAR : Manufacturing Plants in India 2008 *

2007
Area
Location Employees 2 Products Production
(000 m )
(Units)
Backhoe Loaders 700
Thiruvallur, Tamil Nadu 998 740 Wheeled Loaders 846
Rigid Dump Trucks 270
Bare Engines 1303
Hosur, Tamil Nadu 330 130
Diesel Generator Sets 456
*Source : Off-Highway Research

Caterpillar currently has two manufacturing plants in the country. The large Thiruvallur plant is
located 45 kilometres west of Chennai, in Tamil Nadu province, where it produces construction
equipment and components. It also houses the administration and training centres as well as a large
warehouse, storage facilities and demonstration areas. The Hosur plant is located 45 kilometres
south of Bangalore in Tamil Nadu, and is engaged in the assembly of diesel engines and generator
sets.

Caterpillar has announced in Aug 2008, a four-year, US$200 million investment to increase
manufacturing capacity in India for machines and engines.

Caterpillar plans to significantly increase production of off-highway trucks being manufactured at its
Thiruvallur facility, which is already a global source for rigid dump trucks for the company, the only
one outside the USA. It also plans to expand engine production at Hosur by adding production of
the 3508 engine, which will be primarily used in trucks being manufactured by the company locally.

TATRA VECTRA MOTORS LIMITED(TVML)

Tatra Vectra Motors Limited (TVML), formerly known as Tatra Trucks India Limited, is a joint venture between
Tatra a.s. of Czech Republic (a part of Terex corporation, USA) and the Vectra group, a UK based NRI
company, having substantial business interests in UK, the Czech Republic, Slovakia, CIS, Singapore and
India. The Joint Venture was established in July 1997 and the first dumper rolled out in June 1998.

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The manufacturing plant is located in Hosur, Tamil Nadu, around 35 kms from Bangalore. The fully integrated
manufacturing facility includes an engine assembly and testing plant, a cabin welding shop, a frame
fabrication shop and a test track.

COMPONENT SOURCING ( TO ADD HM)

PARTICULARS BEML CAT/HM KOMATSU TELCON TATRA VOLTAS VOLVO

ENGINES Cummins CAT Komatsu Cummins Tatra
TRANSMISSION Avtec / BEML CAT Komatsu Allison
HYDRAULIC
PUMPS In House CAT Komatsu Completely Completely
Built Unit Built Unit
AXLES In House CAT
Imported Imported
STEEL WORK In House CAT
CABS In House
TYRES Various Various Various Various Various

FOREIGN TRADE / EXPORTS

BEML has established its presence in more than 52 countries and has been consistently focusing on the
international business activities with major thrust on Asia Pacific, Middle East and African markets. To
increase its overseas market penetration, the company has set up its offices in China, Malaysia and Brazil.
Further, BEML plans to establish a Sales Office cum Repair Facility and Spares Depot at Balikpapan in
Indonesia within the next three months.

MARKET SHARES

BEML and CAT combined have a total market share of 90 % in the Rigid Dump Trucks segment.
Volvo appears to be the leader in the Articulated segment. Individual sales figures are yet to be sourced for
an accurate market share analysis.

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DISTRIBUTION & MARKETING

OFFICES /
SUPPLIER DEALERS OUTLETS
BRANCHES
BEML 30 22 -
Caterpillar 1 2 80
L&T Komatsu 20 45 100
Telcon 32 38 125
Tatra Vectra 4 8 10 (Warehouse)
Volvo
Voltas

BEML

BEML has a national network of 10 regional offices controlled from Bangalore and Chennai

Regional Offices

NORTH &
SOUTH EAST WEST
CENTRAL
New Delhi Chennai Sambalpur Mumbai
Bilaspur Hyderabad Ranchi Nagpur
Singrauli Kolkata

These are supported by a network of 16 smaller district offices – some located at customer premises
which provide sales, training and support:

District Offices

NORTH &
SOUTH EAST WEST
CENTRAL
Bhilai Hubli Dhanbad Panjim(Goa)
Jammu Madurai Bhubaneswar Ahmedabad
Udaipur Ramagundam Asansol Chandrapur
Neyveli Guwahati
Kothagudem
Hospet

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In addition, Beml has established a national network of 22 dealers covering the whole of India as well as four
large service and machine activity centres:

 Ongole (AP)
 Katni(MP)
 Bangalore
 Hospet

CATERPILLAR

Caterpillar has two dealers in India, namely GMMCO Ltd, covering southern and western India, and TIL Ltd,
covering northern and eastern India.

GMMCO distributes its products through a network of eight regional offices with each responsible for the
operation of branches, site offices and repair and service centres located within its area. These offices are
located in:

 New Delhi  Chennai  Kolkata  Nagpur

 Hyderabad  Ranchi  Mumbai
 Ahmedabad

In all there are 57 site offices and parts and repair centres supported by sales staff and service personnel
located at 26 branches:

 Ahmedabad  Gandhidham  Pondicherry

 Bailadila  Goa  Pune
 Bangalore  Hospet  Ranchi
 Bhilai  Jabalpur  Sambalpur
 Chandrapur  Korba  Secunderabad
 Chennai  Madurai  Singrauli
 Cochin  Mumbai  Surat
 Coimbatore  Nagpur  Visakhapatnam

- 26 -
In addition GMMCO supports the needs of major coal producers throughout India and has service personnel
located at:

 Ranchi – Central Coalfields Ltd

 Singrauli – Northern Coalfields Ltd
 Bilaspur – South-eastern Coalfields
 Nagpur – Western Coalfields Ltd
 Sambalpur – Mahanadi Coalfields Ltd

TIL’s main office for the eastern region is in Kolkata, where there is also a large parts warehouse. In addition
there are 13 sales and customer support centers in:

 Asansol  Jamshedpur  Siliguri

 Barbil  Jharsuguda  Talcher
 Bhubaneswar  Noamundi  Tisukia
 Dhanbad  Ramgarh  West Bokaro
 Guwahati

For the northern region the main office is in Sahibabad near New Delhi which also has a large parts depot.
The main sales and customer support centres are at:

 Amritsar  Jaipur  Ludhiana

 Baglihar  Karnal  New Delhi
 Chandigarh  Lucknow  Udaipur

In addition there are a number of service workshops in both the Northern and Eastern regions.

Both the dealers of Caterpillar have Cat rental stores that deploy a large number of backhoe loaders in their
fleet. Currently there are 11 rental stores in India, a number that is expected to more than double in 2008. This
is a captive market for Caterpillar backhoe loaders and an integral part of its strategy.

- 27 -
L&T KOMATSU

L&T is the sole distributor for L&T-Komatsu and Komatsu machines in India which it sells through its
network of 31 offices as detailed below:

NORTH &
SOUTH EAST WEST
CENTRAL
Delhi Hyderabad Kolkata Pune
Kota Vishakhapatnam Dhanbad Nagpur
Bhopal Madurai Guwahati Mumbai
Jaipur Kochi Ranchi Goa
Chandigarh Coimbatore Bhubaneswar Ahmedabad
Rajkot Bangalore Jamshedpur Vadodara
Udaipur Vijayawada Rourkela
Lucknow Chennai
Durg

TATRA VECTRA MOTORS LTD.

Regional Offices

Tatra Vectra Motors has four regional offices for sales as well as territory management.

 Greater Noida
 Hyderabad
 Kolkata
 Nagpur

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Service Dealers
Tatra Vectra has a total of eight service dealers located along the mining belts

 Kota  Kothagudem  Guwahati  Chandrapur

 Hospet  Asansol  Ahmedabad
 Bhubaneshwar

Parts Warehouse

 Amhedabad  Chattisgarh  Kothagudem

 Asansol  Guwahati  Sikkim
 Bhubaneshwar  Hospet  Tehri
 Chandrapur

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XXXXXXX OFF HIGHWAY DUMPERS : SWOT ANALYSIS

STRENGTHS

1. Pricing

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

2. Aggregates from internationally re-known suppliers

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

3. XXXXXXX Brand Name

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

WEAKNESSES

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

OPPORTUNITIES

1. Non PSU mine owners / Subcontractors

As discussed earlier in the sector breakup, as much as 87% of the operations can be considered as small
scale. India has 2326 private and 292 public sector mines. In addition, Coal India’s reforms aimed at allowing
private interests in coal mining operations, would essentially mean that operational costs would be more
prudently managed by the private sector participants, as opposed to Public Sector Units. Thus XXXXXXX’
possible cost advantage would be a bonus.

THREATS

1. Existing
2. Standard Dump Trucks (“Tippers”)
- 30 -
Standard multi axle Dump trucks or “Tippers” would definitely be a threat to XXXXXXX Off Highway Dumpers.
As industry practices of overloading the trucks, to validate costs of operations is an immutable practice, the
XXXXXXX range will collide with the likes of Volvo, MAN, Mercedes, AMW and more recently TATA World
Trucks too. The primary advantage that these “Tippers” offer, is the comfort of operation and thereby an
increased efficiency. The fact that they are road worthy too as opposed to an Off Highway Dump truck, would
probably not be significant, as the vehicles GVW when overloaded to the extent that they are, would not be
permitted on Indian roads.

3. Chinese Image

As with any manufactured product from China, inspite of a reasonably proven product quality, the ”Chinese
Trash” image will take a greater effort to overcome. Over the course of discussions with several mine owners,
one user of XCMG Wheel Loader actually said: “ We broke it in one week. “. This is not to say that such views
enforced by all personnel in the mining industry, in fact one mine operator conceded that “ Liugong Wheel
Loaders, are performing satisfactorily for the price.” But the fact still remains that the Chinese Image will be
detrimental.

4. Consistency of Parts Supply / Service expertise

Mining operations are very cost centric and any avoidable delays are not entertained. With this background,
the importance of consistent spare parts supply and service expertise cannot be overstated as a factor critical
to success. Industry stalwarts such as Caterpillar, are facing the ire of the consumer, for failure to provide
spare parts on time and for non experienced service personnel deployed at mining sites. VOLVO is currently
taking advantage of Caterpillars deficiency and is provides spare parts at a moments notice, albeit at
exorbitant prices.
Slack operations from a new entrant will not be entertained a second time.

- 31 -
 I
ANNEXURE I

INDIA : OFF HIGHWAY DUMPER MODELS

Payload in Tonnes

BEML CAT KOMATSU TELCON VOLTAS VOLVO TATRA

OFF HIGHWAY
DUMPERS Model Payload Model Payload Model Payload Model Payload Model Payload Model Payload Model Payload
RIGID
T 815 20
20 T - 30 T
HD255-5 25 EH 600 33 Hemang 28
HM 1035 35
31-40 T
BH 35 35 770 D 36 HD325-6 36.5
41-50 T BH 40 40 772 45 HD405-6 41
BH 50 50
51-60 T
BH 60 60 773 D 54 HD465-7 55
BH 70 70 775 F 63.5 HD605-7 63
61-100 T BH 85-1 85 785 D 85
BH 90 90 777 D 90 HD785-5 91
BH 100 100 HD985-5 105
101-150 T MT3000 109 MT 3300 136

MT 3300 136 785 C 136 HD1500-7 136

MT 3600B 154-172 MT 3600B 154-172
151-200 T
MT 3700 B 172-186 789 C 177 730E 186 MT 3700B 172-186
201-250 T MT4400 236 793 D 218 830E-AC 228
930E-4 291
251-360 T
360 960E 327
ARTICULATED
23-30 T 725 23.6 HM300-2R 27.3 A25E/A30E 24-28
730 31 HM350-2R 32.3
735 32.7
31-39 T 740 38 HM400-2R 36.5 A35E/A40E 33.5-39

- 32 -
 ANNEXURE II

INDIA : OFF HIGHWAY DUMPERS : 30 – 35 T PAYLOAD CLASS

XXXXX
Parameters Komatsu CAT BEML Telcon
` XX
Model Model HD325-7R 770 D BH 35 EH 600
Empty
31.6 34.2 21.88 26.49
Weight Weight
Payload (T) 32 36.3 32 33
Make Komatsu CAT Cummins Cummins
Diesel Water
Diesel Water Diesel Water Diesel Water
Cooled
Type Cooled Cooled Cooled
Turbocharge
Turbocharged Turbocharged Turbocharged
d
Power 386KW 381 KW 272 KW 283 KW
Engine Torque 2167Nm 2320 Nm 1450 Nm 1857 Nm
Electronic
Control
Power /Economy
Module,
Special Mode selection,
Modular
Features Automatic Idling
Radiator,Hydra
Setting System
ulic Demand
Fan
Make Komatsu CAT Avtec Allison
Mechanical
Fully
Drive
Fully Automatic Automatic
Powershift Poweshift
Planetary Type Planetary
Type Type with lock with Lock up
With Lock up Type With
up clutch and Clutch
Clutch Lock up
Transmissi lock up torque
Clutch
on convertor
Torque 3 Elements,1
tc 497 Allison
Convertor Stage, 2 Phase
Range 7F +1R 7F+1R 5F+1R
Electronic Shift Transmission
Shift Control
Control Chassis Control
Max Travel 70 Km/h 74.8 Km/h 40 Km/h 60 Km/h

- 33 -
 Speed
Drive left left left left
Special Skip Shift
Throttle Lock
Features Function
Fully
Rear Axle Fully Floating Fully Floating Fully Floating
Floating
Axles
Special
Features
Fully Hydraulic Fully Hydraulic Fully Fully
Type
PS PS Hydraulic PS Hydraulic PS
Make
Electrically
Driven Supplement
Supplement Battery
Manual Hydraulic ary Steering
Steering ary Steering powered
Pump & Pump
motor
Turning
7.2 m 18.1 m 14.32 m
Radius
Special
Features
Body
Capacity 18 cu.m 18 cu.m 18.12 cu.m 14.6 cu.m
Struck
Body
Capacity 24 cu.m 26 cu.m 22.5 cu.m 21 cu.m
Heaped
Dumping
48 deg
Angle
Body
Exhaust with 3
Heating Exhaust Routing
Options
Dual Slope and
Structure V shape body
Flatbed
Castings at
Special Castings at High
High stress
Features stress Areas
Areas
Ind
Ind
Hydropneum
Front Hydropneumatic
atic
Suspension
Suspension
Suspensio
Ind Axle Mounted
n
Rear Hydropneumatic hydropneuma
Suspension tic
Special
Features

- 34 -
 ROPS &FOPS ROPS &FOPS
Cab
Special Viscous Cab
Features Mounts
Service Fully Hydraulic Fully Hydraulic Dual Shoe
Brake oil Cooled oil Cooled type Air over oil
Air over
Front Caliper Disc Caliper Disc
Hydraulic
Wedge Oil cooled
Rear Multiple disc Multiple disc
Actuated wet disc
Drum brake
Internal on
Parking
Caliper Disc Expanding transmission
Brake
Shoe Type output
flange
Oil cooled
Retarder
Brake multiple Disc
2
Independent
circuits
Secondary within
Manual Pedal
Brake service
brake
manually
applied
Fully Hydraulic
Controlled Wet
Special
Multiple Disc
Features
Brakes and
Retarder
Make Komatsu
one 3 stage
Hoist Twin, 2 Stage Electronic Hoist Twin, 3 Stage
telescopic
Cylinder Telescopic control Telescopic
Hydraulic hoist
System Hoist Time 10 sec 8.1 Sec 12 sec
Steering
Special Flat Face to Face
priority over
Features O-Ring Seals
Dump
Fuel Tank 484 Lt 530 Lt 397 550
Extended Oil
Service Change
Refill Intervals,Centrali
zed Filter
Arrangements
Dimension
LxWxH 8465X3660X4000
s

- 35 -
 Productivit Gradeability(
35 35
y Features %)

Author:

SRINI P
TEL : 9740528425

For XXXXXXX
June ‘09

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