Steel Buildings

Engineered to Succeed:
Chaitanya Raj Goyal

PEB Industry Slated to Revolutionize Construction in India

e're careering headlong into a new age of speed building an era where, in some cities, you could go away for the weekend and return to find a brand new skyscraper at the end of your garden. Imagine the relief when you suddenly realize that you have been spared the unnerving, yearlong noises of truck horns, pounding hammers, drilling machines and screaming laborers. You don't have to bother about road blocks either

because there are no heaps of sand, piles of rods, & bricks that have been dumped on your locality roads and you can also keep your windows open because there are no dust clouds to raid your home. And No! It's not an illusion. Relieved and happy, witnessing the construction of this miraculous building next door, you are reaping only its complementary benefits. The major advantages on the other hand are rolling into considerable profits for the in-

vestors, contractors and environment. We are talking about Pre-Engineered or Pre-Fabricated Buildings a sunrise industry which has already got the world talking with the major impact it has registered in the developed nations and is now all set to revolutionize the way India constructs! Industry Overview: Technology and Business PEB, as pre-engineered buildings

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are known in the industry jargon, have been around for a long time, but in India they have taken off only over the last few years. PEBs consist of a complete steel framed building system, with components pre-designed to fit together in a vast variety of combinations, to meet the unique requirements of specific end-users. PEB construction in factory environment is considered to be much stronger than the traditional structures thus ensuring superior product quality. Prefabricated structures also guarantee time minimization, architectural flexibility, low maintenance and operating costs, relatively low design and construction costs, option of single-source responsibility for building, etc. Demand for these buildings comprises warehouses, hospitals, factories, logistics, schools, stadiums, railway sheds, airplane hangars, offices, show rooms and residential buildings. Across India, the manufacturing sector especially has always preferred using PEBs in industrial construction. But over the time with turnaround period and scalability becoming important for construction across micro and macro projects for private, corporate and institutional use - the usage of PEBs has grown in construction projects across various other verticals as well. This is well certified by the fact that Indian PEB market earned revenues of INR 52,970 million in 2012 and the figure is estimated to reach INR 136,120 million by 2016, growing at a compound annual growth rate (CAGR) of 26.6 percent (Frost & Sullivan report). Currently 33% of the Indian construction industry is based on PEB while the remaining 67% is conventional construction. While this figure is lower than some European countries, it marks India's growing global market share at 9.5%, a step ahead of China's 8.5%. Also, the structural steel buildings market in India was around 5.0 to 5.5 million MT in 2011, of which around 9.510% i.e. 537,176 MT accounted for the PEB market in India. It is expected that the market in terms of volumes will reach

PEB Structures offer amazing architectural flexibility

900,000 MT by 2016, growing at a CAGR of 11.1% (Frost & Sullivan report). Growth Drivers: Opportunities are many Growing Recognition: In light of the recent news that PEB has been generating - awareness about their use in almost all the structures is changing the mass mindset for acceptance of PEBs over conventional buildings. Rapid Infrastructural Growth: The government is working to attract investments to the tune of $1 trillion as planned for the 12th FYP across key infra-

structure sectors. The Union Government and other State Governments are going full-ahead to set-up SEZs in exploring maximum opportunities from growing indus-trialization. Also the thermal power ca-pacity which currently stands at 140,976 MW is proposed to be increased by 50,000 MW. The commercial building sector in India, too, is estimated to reach a target of 20.44 billion square feet by 2030 from 7 billion square feet in 2010. It is expected that nearly 34% of 2030 target had already been constructed and
Interior Side Thermal break Recycled-steel Framing Waterproof membrane Gypsumboard

External cladding:
-Acoustic insulation -Ventilated Facade

Mechanical chase Exterior side

A typical wall panel

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Massive investments in metro rail systems and other sectors will boost PEB industry

about 66% of the building stock is yet to be constructed. With such huge investments planned over the next four years in these and many other sectors like realty, ports, logistics, metros, airports, etc., PEB sector is witnessing a huge opportunity. The Green Touch: The environmentally friendly aspects of prefab structures - they create less waste, for example, they are often made from recycled materials (steel especially) and are highly energy efficient - continue to attract green-minded folks around the country. To increase energy-efficiency, many PEB manufacturers have developed high efficiency windows and insulation for roofs, walls, ceilings & floors. The use of sky lights and solar panels on rooftops will meet daylight and captive power requirements, while, at the same time, reducing emissions and gaining carbon credits under clean development mechanism. Technological innovations: The technology being used in modern construction has come a long way. BIM helps in organizing effective communi-

cation between Client, Architect, Engineer, Manufacturer and Erector. This technology is more economic, reduces error, and takes minimum time in conceptualizing and accomplishing any PEB project. Rise of Steel Sector: The Indian steel industry has made rapid progress over the past few years driven by the strong demand from manufacturing, housing and infrastructure sectors. The Indian steel industry's performance this year is regarded as one the best when pitted against global peers. While global steel production grew by a mere 0.9% in the first 11 months of 2012 and Chinese production rose by 2.9%, the Indian steel industry posted an impressive 4.2% growth. Easy availability of steel is going to smoother the growth drive for PEB sector. Affordable housing is need of the hour: India offers a huge market, (over $ 6 Billion for two million units), for affordable housing, which is highly correlated with the government's programmes for slum rehabilitation, for e.g. 'Rajiv Gandhi Aawas Yojana'. This market has a good latent de-

mand and offers a unique opportunity for prefab technology to reach masses. It is very clear therefore that large private sector developers who are eyeing this segment would resort to prefab technology, to ensure that there are faster returns on investment and that the project is completed within an economic cycle. The United Nations Population Division Report of 2007 predicted that the number of mega cities (those with over 10 million or more people) climbed from five in 1975 to 14 in 1995 and is projected to reach 26 by 2015. Naturally, the demand for affordable housing will leapfrog and this in turn will impact the growth of the PEB industry. Growth in Automobile Industry: The Auto industry in India is also on a growth ride and PEB manufacturers are getting enormous business opportunities in setting-up of automobile and auto ancillary facilities. Safe and Efficient: Deeper insight into PEB technology A PEB system in totality consists of a structural system, sandwich panels,

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'Instacon' was erected in 48 hours in Mohali, Punjab

roofing, exterior facade and accessories. The PEB concept based on a proper design usually involves a thorough project information data including complete details like building parameters, grade of steel, secondary member details, paint coat on steel members, welding, anchor bolts steel grade, roof & wall liner/ panel, insulation, sky light, gutters, facia, mezzanine, ridge ventilation to name a few. Following this input, the drawings for general arrangement, Anchor Bolt & Template Fabrication & Erection are prepared. Recently, a 10 storey residential building Instacon, was erected in a record shattering 48 hours from ground zero, in Mohali, Punjab by Synergy Thrislington. The walls of Instacon are made from polyurethane foaming (PUF) panels cast in a factory and screwed together at the site. 70% of the building was pre-fab-ricated and 30% was done at the site of construction. In China too, a succession of tall buildings are being erected in a flash. A Chinese company - Broad claims that it can prefabricate an incredible 93 %. It raised a 15-storey hotel in its home city of Changsha in six days last year and a $17m, 30-storey hotel, just outside Changsha in two weeks. But can a block of flats built in cou-

ple of days really be safe? Many questions are raised worldwide on the safety and efficiency of these structures primarily safety. It may be noted that these buildings are tested at some of the largest earthquake-testing platforms for Magnitude 9 seismic resistance. The economy safety tradeoff provided by PEBs is thus unparalleled and far better than conventional structures. Strategic Management: Existing Market players Started in 1999-2000 with a meager volume of less than 10,000 tons per annum, PEB construction is catching up fast. But despite good demand and due to excessive supply, the market scenario of PEB sector is changing. Suppliers from the unorganized segment of PEB are supplying material and services at an amazing low cost. This is ultimately reflected as a high compromise in quality and services. This is where the organized sector plays a crucial role in the form of technical competence and background because clients are always ready to pay good prices for quality jobs and big ticket projects. The existent Indian PEB segment is highly competitive with presence of established players like Kirby Building

systems, Sintex Industries, Pennar EBSL, Era Buildsys, Tata BlueScope Steel, Interarch Building Products, Tiger Steel Engineering, Phenix Varco Pruden, Everest Industries, Zamil Steel, etc. Also, the sector is going international as companies move to tie up with multinationals for upgrading offerings to their customers. Technical association and JV's with leading PEB companies in Europe, USA and Middle-east are proving quite useful in terms of engineering excellence, product quality and superior products range for Indian firms. Major names that have linked up abroad are Tata BlueScope, Reliance Industries tie up with Mammut Group and JSW Building Systems bonding with Severfield Reeve Structures of UK, as also Phenix Varco Pruden, a JV between Gujarat's MB Group and Varco Pruden Buildings, USA. In such a competitive scenario, the ability of a company to retain its market share without any deterioration in its financial risk profile will prove critical in progress.

A 30 floor PEB building undergoing seismic testing in China

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Volatile nature of Steel Prices poses a huge challenge to the PEB industry

Preferred Alternative: Prefab vs. Conventional Construction Ideal for construction in remote and hilly areas, PEBs offer a complete building system of energy efficient, optimum weight and cost customized fitted requirement. They can be customized as per the climate/design requirements at the site. Since only the bolting needs to be done on the site a quicker construction speed compared to conventional construction is possible. The flexibility of PEBs to be casted even while the foundation is being laid also leads to saving on time. PEBs don't require curing time like concrete and mortar and boast of an immediate occupancy. The quality of the structure being controlled in the factory is superior to that achieved in masonry construction. They are much lighter in weight than normal steel buildings owing to their high proportion of recycled content. Their design flexibility is also a plus with wide ranges of available wall and roof sheeting (granite, stone cladding, brickwork, ACP's etc) and interface details between steel and other materials. These are low maintenance structures requiring only periodic cleaning of roofs, painting and annual washing of eave gutters. The ease of construction makes them hassle free and bestows

cleaner sites since the self-supporting components don't require shuttering or scaffolding. Future extensions/modifications or dismantling/relocating can also be accommodated easily. The Steel Saga: Impact of Fluctuating Price The usage of steel and especially in pre-engineered buildings is growing very rapidly in the Indian construction industry. Steel accounts for 65-75 % of the total raw material cost of a PEB. Thus availability and pricing of steel does make lot of difference to organized sector of PEB suppliers. The steel prices are volatile in nature and the same are driven by the global prices and are also dominated by the demand supply scenario prevailing on a particular day. Hence, profitability of the company can be impacted with adverse movement in raw material prices which it may not be able to pass on entirely to its clients, owing to competition pressure and lack of escalation clause in its contracts with clients. Off late, fluctuating steel prices has become a matter of concern which could affect the overall industry growth. Long-term rate contract is only possible if the steel purchaser is a very huge player. This is because the margins are higher in larger purchases with huge

players, so the steel manufacturer does not mind having long-term rate contracts. On the other hand, if the margins are slim, no steel manufacturer wants to enter into long-term contracts. Thus availability of steel in an affordable price is a big challenge. Speed Breakers and Way forward India is fast turning out to be a fertile ground for PEBs as the country is witnessing a boom in the construction sector. But there are still quite a few issues pertaining to the sector which are holding it back from exploiting its full potential. The lack of availability of international quality materials like quality fittings, insulation materials, wall claddings etc. is hampering growth because it makes the designers hesitant about opting for PEB structures. An Indian PEB manufactures association code of practice and PEB design institute need to be initiated. Such efforts will promote the merits and usage of PEBs in the country. To be competitive, this industry should look at investing into training of workmanship, R&D, manufacturing processes and also into latest software to optimize the design. It is essential that the industry focuses on these areas in coming times - to emerge as world players and to see a wider application of PEBs in India.

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