Power and automation technology maker ABB India has been eyeing areas like solar power to tide over the weakness in its traditional markets on account of the delays in large infrastructure projects. Bazmi Husain, managing director, ABB India, tells Ajay Sukumaran that a revival in the traditional market is not too far away and that the company is ready for it. Edited excerpts:

How has 2013 been for ABB India?

Right now, clearly, there is still an uncertain market out there. Large infrastructure projects are delayed. Only projects that have gone beyond a point and it would be expensive to stop, are the ones that are continuing. So, in that sense, it has been a challenge for our traditional markets. What we have basically done is gone looking at newer segments. Solar is clearly one area where we have done quite a lot. This year, we have supplied over 300 megawatts of solar inverters and other equipment. We are also looking at a lot into water.

I think that up to Q3 (ABB follows a January-December fiscal), our results have been such that volumes are, more or less, growing a little bit. Orders, especially large project orders, have been impacted but we still have a healthy backlog. Is it a cause for worry? No, I don’t think so, and I can say that we have also used this time to invest a lot. Just last month, we inaugurated two large plants. We have always felt that the best time to invest is a time like this. So, when the market really comes up, we are ready for it.

Will these new areas add significant volume?

Well, they are helping us. If you look at publicly available data, the drop in the market volumes is much higher, in terms of new projects getting stalled, than we have seen in our overall order intake. So obviously, to a large extent, they have been able to buffer the impact. Now when the traditional market picks up, this will remain.

How have you controlled costs?

One dimension is the improvement in productivity because of automation. The other is to look at the processes and improve them. If you can do something faster, the cost is typically lower. Clearly, this reflects in our Q3 performance. Our volumes have gone up, but our personnel costs remain the same. In this period, we have continued to hire. The focus is not employee reduction but operational efficiency. That frees up resources to look for new areas. We ventured into a lot of new areas and we didn?t have to hire for that.

What are the other key areas you are looking at?

We are not in an industry that is prone to changing fast into new areas. But the new areas that come up are not short-lived either. In solar, you have only seen the tip of the iceberg in terms of the total market. I think, the next big thing is grid stability because the market for it in India was not big. All the market in India was in adding new transformers, circuit breakers, sub stations and new lines.

In fact, India this year will become one of the largest markets for grid stability equipment. Right now the Indian grid is about 230 gigawatts (GW). It is said that in the next 20 years or so it will go to something like 800 GW. Plus, the increasing amount of renewables coming into the system because the grids, as they are, were never designed to be used with power sources that are intermittent. The third area is power quality.

What about your core power business itself?

When the revival will come, I cannot say. But I can say with a fair amount of confidence that I don’t think the revival is too far away. And when it begins, it will be a quick one. We are ready for it, I would say, I think we have used the time of the downturn in a good way, adding new capacities, taking out our inefficiencies and making the system more efficient.