Birla Precision Technologies: A legacy of excellence

  • Industry News
  • Feb 10,22
Birla Precision Technologies, Dagger Forst, cutting tools, gear cutting tools, Vedant Birla, Tool Bits, machine tools, Kennametal, Precision Components, Hydraulic Components, auto Components, Engine Components
Birla Precision Technologies: A legacy of excellence

Birla Precision Technologies' journey began with the vision of Ashok Birla, who foresaw very early on, that technology would come to India mainly through foreign collaborations. Nation-building being the burning desire of the illustrious Birla clan back then, Ashok Birla formed joint ventures with several overseas players, and in diverse fields. Among them were Birla Yamaha, a joint venture with Yamaha (Japan) for diesel engines and gensets; Birla 3M, a joint venture with 3M (USA) for glue and telecommunication tower equipment; South Pacific Viscose, a joint venture with Lenzing (Austria) for viscose staple fibres; Dagger Forst, a joint venture with Forst (Germany) for gear cutting tools; and Birla Kennametal, a joint venture with Kennametal (USA) for manufacture of machine tool accessories.


To further build on Ashok Birla’s legacy, his son Yash Birla too entered into a joint venture with Perucchini (Italy) later to produce auto parts. As for Vedant Birla, Yash Birla’s son, the scion holds much promise as a successor, being the man at the helm at Birla Precision Technologies today - the company born out of the amalgamation of the Birlas’ joint ventures with Kennametal (USA) and Perucchini (Italy). Vedant joined Birla Precision in 2014, as Business Head, armed with a bachelor’s degree in accounting and finance and an MSc in general management. Before joining the family business, however, Vedant had acquired experience in the fields of education, healthcare and steel pipes, having started to work at the age of 17. Apart from these, he also acquired work experience through summer internships at Hindustan Unilever Limited (HUL), IBD, Phillip Capital and Heron International, the last two being in the UK. While at HUL, his work involved visiting kirana (grocery)stores along with the manager to sell Knorr products.

These grassroots experiences, stood Vedant Birla in good stead, as they prepared him for the more responsible role he would go on to play later at Birla Precision, a publicly traded engineering company boasting several divisions and four plants across the country. Being in the shadow of his father Yash Birla at his meetings, he was guided in the areas of strategy and organisational planning. One of the key learnings was to decentralise a few functions and spread more work over lesser executives, giving them more autonomy.

With Chairman and Managing Director Vedant Birla at the helm, the company has achieved several milestones and clocked steady growth in domestic and international markets.

Key divisions and products
Birla Precision Technologies Limited (BPTL) comprises 5 divisions.

The first, Indian Tool Manufacturers (ITM), is a division of Birla Precision Limited, created in 1937. This company manufactures and supplies high speed steel cutting tools in various grades (M2, M35, M42, & T42) using the finest quality high speed steel and a catalogue product range of various types of Drills, an assortment of Milling Cutters, Reamers, Taps, Tool Bits and Files. under the “Dagger Brand” which conform to stringent world standards. They have recently added a high end product range “PANTHER” taps and drills to offer better solutions to their customers.

The company successfully launched the “TORPEDO” brand of PM Taps and Through Coolant Taps and would soon launch the NINJA Brand Taps and Drills to meet the domestic demand. Intensive R&D on a continuous basis and an uncompromising culture, allow it to cater to the demand for innovative products. The products are currently exported to the European and American markets apart from being sold in India through an extensive distribution network to a gamut of government clients like HAL, BHEL, the Defence, the Railways, and others.

The second - the Tool Holding division - is the erstwhile Birla Kennametal established in 1986—started as a joint venture with Kennametal USA, a US $4 billion conglomerate which manufactures machine tool accessories like rotating tool holders in AT3 class, collets, work holding devices, custom indexable and multi-spindle heads & other CNC tooling. Birla Kennametal exports to over 20 countries worldwide. This division caters to the international market –USA, Germany and APAC, and of late, to the Far East including China - supplying rotating tool holders in AT3 class. This division also sells in domestic market in a large way to all major customers.

The third division is the erstwhile Birla Perucchini, formed as a result of a joint venture with Perucchini (Italy) one of the biggest names in the European Hydraulic space — a foundry which makes auto components (and of late, hydraulic parts as well). It produces shell-moulded ferrous castings straddling the entire spectrum of nodular, vermicular and grey cast iron. Big league names like Honeywell, Sundram Fasteners and Cummins trust and rely on the company for high quality products.

The Auto division makes Fuel Injection Systems, Hydraulic Components and Engine Components like Turbo Chargers, Housings etc. Their automotive division is geared up with all customers for Euro 6 norms which came into India in 2020. Taking the next leap BPT has a strong presence in the automotive sector and is planning to grow it further in the coming years. They aim to make significant investments in the auto components division over the next three years.

The Precision Components division is a 100% exports division, which manufactures engine components, shafts, etc. for various automotive clients abroad. It has recently entered the domestic market.

These 5 divisions are spread across four plants in India – one in Nashik & three plants in Aurangabad. and a fifth one that is coming up at Chalisgaon, Maharashtra, to cater to some of its new products. All these plants have been set up either through foreign joint ventures, employing state-of-the-art equipment and systems, or with the help of the company’s in-house R&D facility. They employ a total of around 1,000 workers. The company has 11 branch offices across India and a vast distribution network.

Leadership through R&D and product innovation
The primary focus is to directly connect with new actual users and increase more business with channel partners. There are plans to extend services to potential customers thereby moving towards being a preferred supplier and partner. The focus is on SMEs and most of the sale in this segment happens through a strong dealer network. With over 500 dealers across India, the company has one of the largest dealer networks in the entire domestic industry. They have recently increased the number of branches and strengthened the sales team, to help get “more feet on the street.”

The company allocates around 1-2 percent of its revenue on R&D activities. Its in-house cell basically does Application Engineering, Project Engineering and Custom Solutions. It takes the design from their customers and provides them with a better CPC or better-quality tools by improving the tool design and materials. This initiative called Value Selling is aimed at making its customers more competitive. The company also regularly works on new designs and serves customers through its Application Engineering department, making custom solutions tailor-made for individual customers.

Key technological trends driving the industry
On a quarterly basis, bench-marking exercises of the products are conducted by comparing their product with the best products in the market, and also with all their peers. Birla Precision’s products are considered superior to those of its competitors by the market. Their unique and strong heat treatment process bestows their tools with top quality. Recently, a test study was conducted internally with their products and products of the top five manufacturers of the world. Their drills stood at No 2 in terms of the lowest CPC (cost per component), which is a measure of ‘value add’ for the customer in the engineering industry.

Birla Precision Technologies are at the threshold of Industry 4.0, which is the current trend of automation and data exchange in manufacturing technologies. Using IoT, cyber-physical systems communicate and cooperate with each other and with humans in real time, and via the Internet of Services, both internal and cross-organisational services are offered and used by participants of the value chain.

BPT closely monitors changing technology and feels that technology will drive the industry and hold the key in the long run. One trend that BPT is betting big on is Industry 4.0– automation and data exchange in manufacturing technologies. Concurrently, BPT is also planning to diversify its offering in the automotive segment by venturing into hydraulic components. This strategic move is to gear up for the rising popularity of electric vehicles.

The market is getting stabilised after GST implementation. The effects of major reforms are yet to take place which could prove to be an important factor for growth. Technology will drive the industry in future and will hold the key in future. Competition will definitely grow, but this will only benefit the customer and supplier in the larger context. Power will move to the customer. Further, the switchover to electric vehicles is imminent now. Eco-friendly vehicles, autonomous driving, using AI in automobiles etc, will be the key trends that will influence the industry.

New avenues of growth
There are plans to go to the next level of technology and expand from steel tools only currently, into carbide tools.

Considering that the auto industry is cyclical in nature, Birla Precision has decided to branch out into hardware. It has recently launched its ‘Hathyar’ brand accordingly, which caters to various industries like carpentry, construction, marble cutting, masonry and the like. Birla feels that since infrastructure is likely to remain a boom industry in India, this was a strategic and good decision taken by the company and has been working well for them. As for future plans, in the next five years, Birla Precision will branch out into three distinct lines for its cutting tools division. Also, they are in the midst of setting up subsidiaries in Germany and USA, both of which will have local teams and which are in the process of being recruited. The company thus looks to becoming very active globally from next year onwards.

The company envisages becoming a world class organisation and a global supplier with steady focus on customers and the offering in terms of value chain and quality of products. In the long run, it expects to be recognised as a world leader in total and innovative engineering solutions.

While the move towards electric vehicles is good, once they become mainstream, many of the components manufactured will be rendered obsolete. Apart from considering other car components that the company can build, it is also looking at supplying to the defence sector. Further, the company is looking at growing its strongest division, tooling by investing in quality and consistency. They have expanded their capacity in tooling by 15–20.

Looking ahead, as the automobile and manufacturing segments continue to gain momentum, Birla Precision Technologies’ growth outlook looks positive. Given the company’s firm focus on innovation, customer service and diversification, it is all set to scale greater heights. Their vision is to be among the top four players in the world in whatever space they are in. With the ambition and dynamism of Vedant Birla, the company could well achieve that goal.

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