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“The key growth driver for us in next five years will be health care equipment business…” - Views on News from Equitymaster
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  • Nov 24, 2003

    “The key growth driver for us in next five years will be health care equipment business…”

    Mr. H. G. Gelis, who joined Siemens Corporation as a trainee, has received a degree in electrical engineering in Germany and in business administration in the United States. After being with Siemens for 27 years, in November 2000, Mr. Gelis became Executive Director of Siemens Limited India. Prior to his new assignment as a member of the managing board of directors and CFO at Siemens Ltd in India, Mr. Gelis was also the Vice President of Internal Audit and Business Consulting of Siemens ICN in U.S.A.

    He undertook a number of development and business assignments for the Telecommunication group of Siemens AG in Germany. He worked on large assignments in Argentina, Brazil, former Soviet Republics and Turkey.

    In an interview with Equitymaster, Mr. H.G. Gelis talks about the different businesses of Siemens and also speaks about the future focus areas.

    EQTM: What is your view about the Indian economy at the current juncture?

    Mr. Gelis:  India has the highest application for investments at this point over all. We can see larger infrastructure projects coming. Therefore it’s not only new upcoming sectors like IT and automation, but there are opportunities to grow in other sectors as well. We have a long way to go in power, as there is a huge gap in demand and supply of power. India is the one country where the demand-supply gap of power is largest. We have opportunities in telecom and other areas too.

    EQTM: What do you think will be the key growth driver for Siemens? Will it be power, automation, healthcare equipments or communication etc?

    Mr. Gelis:  Unlike other engineering companies, we are not only power generation equipment company. We have a wide portfolio of products and we are in position of taking advantage of growth in all other sectors. I think the key growth driver for us in next five years will be health care equipment business. We have made investments in our medical business and we are sure of generating returns in coming years. Apart from that, IT will be the next key growth area and we expect to grow at a rate of 18% for next two to three years.

    EQTM: Talking about Electricity Act 2003, how do you think will it benefit an engineering company like Siemens?

    Mr. Gelis:  In power, our company is into all areas, whether it is generation or transmission or distribution. So that ways, we can provide whatever a customer wants. In last two years, we have seen growth in T&D segment. To the best of my knowledge, there is no other country where power demand is as huge as it is in India. But the problem starts when the guy who wants to invest money is not sure of returns. So larger projects are not yet coming. Though the environment seems to be much promising, nothing seems to be happening in short term, say next 12 months. However, we as supplier of power equipments are ready.

    EQTM: Communication forms around 25% of Siemens AG revenues, whereas in India, revenues from this segment are on lower side. Would you like to share some of your plans for this segment?

    Mr. Gelis:  Telecommunication has two segment viz. private telecommunication and public telecommunication. In public sector communication, we have wireline and wireless systems. Siemens operates through one of its daughter company, with revenues of over Rs 4 bn. In private communication, Siemens is not a prominent player in India due to low cost supplies from the grey market. But we have done some investments and in two to three years time, we expect Siemens to be one of the top three players.

    EQTM: Apart from work where do you spend your time? And who is you role model?

    Mr. Gelis:  I like to spend my spare time with my family. Well I like visionary people. Those who have a desire to reach somewhere at the end of day like the founder of our company Mr Von Siemens. Siemens came to India 155 years back and we are still here. Now apart from Germany, other big markets for us are US, China and India. We plan to grow our volumes very fast and hope to grow at faster rate than Siemens China.



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