Infrastructure development is one of the key indicators of economic development of the country. iQuippo being the leading online Auctioneer of infrastructure equipment, how is the market for infrastructure equipment in this pandemic period?
With the pandemic around and the lockdown in force the first two months (April and May) there were hardly any sales. In June sales started to pick up. In some segment we crossed the last year’s revenue for that month. With the pandemic the government has realized infrastructure is the key for the nation to grow. During the pandemic period we had border dispute which resulted in skirmishes with China. To gain better advantages than our rivals’ lot of border infrastructure development works are in progress and many infrastructure projects over there are in pipeline for execution. I think that’s why infrastructure equipment demand came back pretty strong in June and July.
Our sales for used equipments have definitely gone up. In this pandemic time buyers are preferring used equipments instead of new equipments. Due to the pandemic purchasing power of the customers have decrease. Used equipments being cost effective we are seeing a huge demand for used equipments. We are also working with OEMs to promote new equipments in place of old equipments so that the customers can use their assets to its full life. On the finance front, due to lockdown processing has been slow on our portal, since our partner banks’ offices were either closed or working with minimal staff in light of Covid-19. Things are slowly coming back to normal on the finance front.
How is the buyer sentiment?
Buyers are well aware infrastructure work is happening. The government is spending a lot of money on infrastructure projects as this is the only way to bring back economic growth of the country. Time and again either thorough special announcements and in Budgets the government has allocated huge funds for infrastructure developments. We are noticing green shoots especially from the rural infrastructure. With Agri and rural infrastructure works gaining pace we see buyers’ sentiment more buoyant in the rural areas because there is where infrastructure work is happening. I think supply chain need to be developed and that can happen only if proper infrastructure is there.
Which are the equipments that are in demand in this pandemic period?
There is huge demand for backhoe loader and excavator. The sales of these equipments have crossed the last year’s revenue of that month. The demand for these equipments are more from the rural areas, and from Municipal Corporations, where infrastructure work such as construction of roads, laying of drainage pipelines, sewage treatment plants and works under Smart Cities and Swachh Bharat Abhiyan are in progress.
The other big demand is for the mining equipment. The government has privatized mining sector and now private players too can participate in mining. This has given a huge boost in terms of sales for mining equipment. India does not want to rely on imported coal. The government has started the process of auctioning of coal mines. We foresee a huge demand for mining equipment in the near future.
Online Auctioneering portal have to maintain utmost security to ensure secure hassle-free transaction between the buyers and the sellers? How is your portal addressing the safety concerns?
Usually portals are built on open source technology. But to make our gateway secure we have used license technology. The technology provider updates security and safety features of the gateway every fortnightly. Beginning this year we have done our security audit by IBM. That is how we are addressing the security concern by using top class license software to build our portal. To further fortify our security and safety features we have added one more layer of security. We are now implementing Blockchain. With Blockchain each and every transaction that happens in our portal is encrypted. Additional security features such as OTP are there to address the concern of the buyers and sellers.
What are the Schemes and Financial assistance you offer? Please share with us your tie-ups with banks and NBFCs?
To provide better financial assistance to our customers we have tie-ups with major banks and NBFC. We have tie-ups with 10 major banks with include Bank of Baroda, HDFC, ICICI, Axis Bank, PNB and others. The NBFC, we have tie-ups with are Mahindra and Mahindra Financial Service, SREI Equipment Finance. We are in the process of including TATA Capital to offer financial assistance to our customers. To provide better options to our customers we are working on with the manufacturers and financial service providers on various schemes. One of the key schemes we are right now working on is the Exchange programme. In India, the used equipment market is unorganized and customers don’t have enough funds to buy new asset. For those, iQuippo can arrange refurbished assets or they can exchange their old asset for a brand new one. This is one key scheme we are planning to implement in collaboration with our manufacturers and financial service providers.
The next we are planning to launch is on the Leasing front. We are working with some of the partners who offer leasing on their platform. With the new MSME guideline and liquidity crunch in financial market, it has become difficult for contractors and customers to get Non-fund based Limit, Bank Credit and Letter of Credit, because of these Customers does not prefer to own equipment. In owing an equipment entire capital of the customer gets blocked. If the customer goes for leasing, he saves on his capital and he can own the asset till his project gets completed.
How do you authenticate and ensure right valuation for the equipment?
Before iQuippo went digital we have been doing valuation for the last 15 years. We have the entire data of each and every asset when and at what price it has been sold in its entire life. With that data we have done a lot of data analytic and through RSO engine, there we use Artificial Intelligence (AI) to get the right valuation for the equipment. We have made curves on each point of time, to determine the equipment price in the market. We have seen that the valuation that we provide; the variation in the market is not more than 5 percent.
What are the value-added services you provide?
Right now, we are providing logistic assistance to customers. When a customer acquires assets from us either on lease or outright purchase, we ensure the asset reach the last mile site without any hassle. We also assist our customers by providing more insight on the equipment they need for their current job requirement. Based on our interaction with customer about their requirements, nature of job to be executed we guide them which asset is best for them. For example, if the project is going to be commissioned in one year, we advise them accordingly which asset to lease or buy, the cost-effectiveness and the efficiency of the asset. These are the two services we are offering right now. But in future we would like to add more services such as spare parts, repairing and maintenance.
What are your growth plans for iQuippo for the next three years?
We will be introducing more assets in Agri, Construction and Medical. These are the three verticals where we will be expanding with more products and services. We are also coming up with a rental service akin to Uber model. The idea behind the rental service is to bring all unorganized rental provider to one rental platform to serve the customers better. We are also planning to add spare parts and enhance our logistic service. We are getting a lot of International buyers from South East Asia. In future, we would like to expand in South East Asia to offer better services including auctioning and financial solutions.
