“So, how’s business?” Ask any businessman this question and, often, you know what response to expect. “Good, very good, excellent, thank you.” But S Ravi, chairman and managing director of Craftsman Automation, said, “Not good.” He explained why: “The commercial vehicles market is looking tough and we don’t know how long it will continue like this. But tractors have done well for us. And we are in a much better position than we were at the time of the Lehman crisis.”
That’s Ravi for you: Positive and realistic at the same time. His company is no different.
Craftsman Automation, a diversified light engineering company was started by Ravi. Its central idea was to make things for others in a cheaper, more efficient way. Headquartered in Coimbatore, with 10 plants across India, Craftsman’s business is split almost 50:50 between automotive and non-automotive products. In the automotive vertical, it manufactures engine heads, blocks and transmission parts, including gear boxes for commercial vehicles, tractors, construction machinery and utility vehicles. Key customers are Daimler India Commercial Vehicles, Tata Motors, Ashok Leyland, Mahindra & Mahindra and JCB.
In the non-automotive vertical, Craftsman makes wire rope cranes, electric chain hoists, marine accessories, sheet metal products, and aluminium foundry; it also does contract manufacturing for industries like printing, textiles and windmills.
While Craftsman started out as an export-focussed company, today, domestic versus export revenues are split 75:25. In 2010, International Finance Corporation invested about Rs 162 crore, followed by Standard Chartered PE with around Rs 85 crore in 2012. Both picked up minority stakes.
The man behind it
At the age of 21, in 1984, S Ravi, a final year student of mechanical engineering had time to kill. That is when the idea of Craftsman Automation, a partnership between him and his college seniors, was born. “I had the opportunity to study further or look for a job outside because job opportunities were very limited here. The other option was to stay in Coimbatore and start out on my own. I chose the latter,” says Ravi.
Craftsman started as a vendor to manufacturing units in Coimbatore. “Then we started sourcing material, doing sub-assembly, making customer -based products, redesigning products and, finally, producing the products. We increased our manufacturing activity from machining to foundry and sheet metal,” adds Ravi. By 1990, he realised that growth opportunities were getting limited so he reached out to larger companies for alliances.
Over the next few years, he set up several businesses—manufacturing auto components, plastic parts, pressure dye casting, a textile unit. While this helped Craftsman grow, it also became too large and diversified to manage. “Around 10 years ago, I decided to quit everything and concentrate solely on Craftsman Automation. One by one, I have given all the other companies to my colleagues,” says Ravi.
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(This story appears in the 06 September, 2013 issue of Forbes India. To visit our Archives, click here.)