Thaindian News

Chennai, Aug 15 (IANS) A capital equipment maker in Tamil Nadu has adopted the comparative advertisement marketing strategy to lure power companies to buy its super critical boilers which operate at high temperatures and pressures.
The advertisement strategy (comparing features and prices of goods) is commonly used by consumer durables and fast moving consumer goods companies.

The Tiruchirappalli (Trichy)-based Cethar Vessels has issued full page advertisements in leading newspapers here, drawing the attention of power sector players.

“Design wise our super critical boilers are at par with any other competing boilers in the market. However, we are being sidelined for not having a joint venture with a foreign player. And hence the advertisement,” K. Subburaj, chairman told IANS.

In its advertisement, Cethar Vessels has claimed that the price of its super critical boilers ranges between Rs.1.25 crore and Rs.1.30 crore whereas others are selling at a premium price of Rs.1.75-1.80 crore.

If one goes by Cethar Vessels claim, a 660 MW power project promoter can save Rs.330 crore using super critical boilers made by the company.

“Foreign boiler makers load the product prices by around Rs.35 lakh towards brand premium. This advertisement will bring down that brand premium,” Subburaj said.

However, industry officials told IANS that Cethar Vessels has actually understated the competitor prices as the going rate is around Rs.2 crore per MW.

Subburaj said post Aug 31 when customs duty will be levied on power equipment imports, boilers of Cethar Vessels will be cheaper than the imported Chinese boilers.

Asked about the advertisement and its likely impact on boiler prices, A.V. Krishnan, executive director (Boiler Division, Trichy), Bharat Heavy Electricals Ltd, said: “What Cethar Vessels has announced is the price of one product/component and not for the entire solution which includes turbine-generator.”

He said power project promoters generally look for a total package (boiler, turbine-generator) and not the individual components.

Another senior official of a power equipment manufacturer told IANS on condition of anonymity: “Those who are looking at Chinese equipment may consider Cethar Vessels. But it will not be a threat to others.”

According to Subburaj, Cethar Vessals is targeting the private power projects and not the government-owned power units.

The Rs.1046-crore revenue company has got the technology to make super critical boilers from US-based Riley Power, which in turn has got the know-how from Siemens. With the tie-up Cethar Vessels can make super critical boilers of capacities of 600, 660, 800 and 1,000 MW.

Cethar Vessels’ plant at Trichy, around 300 km from here, has an annual capacity of 8,000 MW and is in the process of expanding it to 12,000 MW.

Subburaj said the company has opened the current year with an order book of Rs.5,500 crore and hopes to close the year with a turnover of Rs.2,750 crore.