Super Iron Foundry Pvt. Ltd., a leading cast iron manufacturer, is on the path to becoming a multinational leader in castings. With a state-of-the-art 20-acre facility in Durgapur, the company is driving innovation through automation, capacity expansion, and sustainability initiatives. In this exclusive interview, Chairman & Managing Director, Akhilesh Saklecha discusses Super Iron Foundry’s journey, challenges and future roadmap.
Mubina Kapasi: SmallCaps are a treasure trove of varied industries, from crane lifters to mobility solutions. On SmallCap Spotlight, we’ll be meeting one such company, Super Iron Foundry, a cast iron foundry whose primary product is manhole covers, among many others. On the anvil of an IPO, this company has a 20-acre facility in Durgapur, West Bengal.
And we catch up with Akhilesh Saklecha, Chairman and Managing Director of the company, who takes us on a tour. So Akhilesh, let’s start off first by understanding what exactly was the beginning of Super Iron & Foundry and interestingly, I also want to know why Super Iron & Foundry?
Akhilesh Saklecha: Super Iron Foundry was started by my father. It was in 1977 when we set up our parent unit, which is still functioning.
It’s another company of ours. In 1977, he set up as a foundry manufacturing cast iron castings. He was a thorough foundry man, you know, knew all the details and nuances, which I always aspired to be able to walk into his shoes.
Mubina Kapasi: Many of these businesses in India is proudly run and owned firstly by a family. And it’s come to this, right, this wonderful facility that you have initiated in Durgapur in West Bengal. I want to know how and where did you get involved in this family business.
Akhilesh Saklecha: I got involved into the business in year 2005.
It just happened with the untimely demise of my father. And I was studying back in the U.S. then. And I had plans to do the distribution network because we were already supplying to all the major cities, municipalities in the U.S. And the natural gradual progression for us would be having our own distribution set up there.
That’s how I got started, you know, with my elder brother. Between him and me, we started working in the foundry. We worked in the parent foundry. And then, you know, we got the idea of setting up a ductile iron foundry because the world is moving from cast iron to ductile iron.
Mubina Kapasi: The company has recently invested in CAPEX to boost production capacity. With 60 to 70 percent automation, including robot fettling, painting and automatic pouring, the move ensures higher efficiency, cost savings and timely deliveries.
And I just want to talk a bit more about that expansion bit because it has 20 acres. You’re using only 12 yet. And I understand you just had a CAPEX. So what does that bring your production capacity to now?
Akhilesh Saklecha: So the production capacity is around 70,000 tons currently where we are. We have a lower capacity utilization, around 30 odd percent. And that itself is unique as in, you know, we are profitable with low capacity utilization.
So once the capacity utilization goes up as well as so we are going to have the economies of scale kicking in as well as fixed costs are going to be the same. So, you know, there’s going to be the journey, the growth is going to be incremental for us with the higher capacity utilization. The new plant, which we set up in 2021, in the second round of CAPEX, which we did, which increased our capacity quite substantially.
And that’s why you’re seeing such a high installed capacity, which we are having for a foundry. And we have about 60, 70 percent of our existing capacity utilization coming from automation.
Mubina Kapasi: The manufacturing facility has been set up in 2013 and is located in the steel city of Durgapur near the Damodar River, leveraging the region’s abundant raw materials and affordable power.
Akhilesh Saklecha: Main input raw materials for us is pig iron, scrap and our own generated scrap, which is called foundry return, which is any rejections or run arises, which is remelted. And we also use ferrosilicon magnesium or magnesium to treat. These are the main raw materials other than electricity and power, which is one of the big input costs for us.
So these are the big heads with which we work is in the base metal, ferro alloys, power and labor. These are the big heads of the cost, which we are working in. And given to your question about the price movement of the raw materials, the raw material price movement is something that we build into our cost of the product.
So when we are exporting, we have a slightly long term contract. So if there is any spot market price increase or decrease is negotiated in the export contract with a time lag, which works out both ways. You know, if in an increasing market, you know, we pass it on with a time lag with a decreasing raw material prices.
We also pass on the price decrease with a time lag. So it works out both ways for us.
Amarnath Prasad: My name is Amarnath Prasad.
I am the head of production here. I am in charge of the production of the plant. We order the incoming raw material. We test the incoming raw material first. After testing, we go to the melting section. After analysis, we send it for pouring.
After pouring, there is a separate process of mold making here. After mold making, we pour the metal. After pouring the metal, there is a casting form.
After the casting form, we take it to the shot blasting area. After the blasting, there is a fettling and finishing. Fettling and finishing means to finish the rough casting, to give the final touch. After finishing, we come to the paint shop. After the paint shop, we go for packing and final dispatch.
Mubina Kapasi: So, Akhilesh, cast iron, ductile iron. I think we need you to dumb down your products a little bit for our audience. Tell us, what exactly are the products you make here through your foundry?
Akhilesh Saklecha: Cast iron is also called grey cast iron. And ductile iron is also called spherical graphite iron. Basically, you take a cast iron and put it under the microstructure. And you would see flake structure. Which renders it lesser strength, physical strength in terms of tensile strength. Vis-a-vis ductile iron, it is a nodule shaped microstructure. Which renders it more physical strength. Which is much more than cast iron.
So, it makes it, for any product design, more ergonomic. You know, you can use less material to have higher tensile strength and all that. And that makes the product much better. So, that’s the major difference between cast and ductile iron. And the products which we are manufacturing here, a majority of our production still is municipal castings. But there is a MyRide application for iron castings.
You know, like you go railways in terms of tracks as well as in coaches. Electrification, agriculture, water main. You name automotive, you name a sector and it uses castings.
Our big focus up to now still is municipal castings. And we make municipal castings for over 30 countries globally.
Mubina Kapasi: In fact, exports is where SuperIron gets almost 90% of its revenues from. The company exports to the UK, Europe, Australia, the US, Middle East, among others. With each market having its own strict standards, the company has to follow rigorous quality control measures to ensure precision.
Akhilesh Saklecha: You have to have basic systems in place, whatever the customs requirement, you know.
So, if we go to Australia, you know, there is a different set of covers that goes, you know, there’s a gas tight application. So, we need to understand what kind of application, what kind of chambers, what kind of load rating. So, we have systems in place with which we have quality systems manual for different products, different critical to quality parameters for different products that we are defining.
Say, for example, a product for a particular customer requires a lower clearance, clear opening, which is not particularly to the standard, but it is a particular customer’s requirement. It is over and above the standard. So, we keep those customer requirements critical to quality for each product.
And that’s how we are maintaining quality because quality is something that, you know, we take pride in. And we want to be the super people, the super quality people. That’s how we ensure the quality.
Mubina Kapasi: So, you’re exporting a big chunk of your products, but there’s somebody else also exporting and that’s China. Has that been a competition for you, especially a business like yours?
Akhilesh Saklecha: Absolutely, Mubeena. China has always been a big producer for iron steel castings. If you look at the Chinese export portfolio of castings, India still has a lot of catch up to do. But having said that, you know, the way China has been growing, it has been catching a lot of eye, especially US, Europe. And they’re putting a lot of punitive trade barriers onto China, such as tariffs, anti-dumping.
And there’s a lot of duties that, you know, Chinese products are attracting, especially during Trump’s regime. There’s been a recent announcement of additional 10% tariffs. In our product category in the US, Chinese products used to have 25%.
And on top of that, additional 10% makes it 35%. So, we are 35% cheaper from there from day one.
Mubina Kapasi: Now, the question is, can an iron foundry practice sustainability, especially as global markets tighten regulations?
The company is taking a proactive approach to stay ahead and is aiming for a very ambitious target of carbon neutrality, setting longer term goals to drive a greener future in the foundry industry. So, you’re soon going to be a listed company. There will be certain ESG expectations, even if it is a foundry. I wanted to understand, as the world will expect, even from commodity companies to contribute towards ESG norms, how are you doing that?
Akhilesh Saklecha: It is a very big word, you know, in terms of ESG to be able to contribute as a foundry. And we find that there is a lot of opportunities, you know, so for us in terms of improved ESG goals, us as a company, you know, like we intend to use solar power in the long term, reduce our carbon footprint, because most of the power, electricity, it’s an electricity power intensive industry. And if we can use it with, substitute it with renewable energy, this reduces a lot of carbon emissions. We use a lot of sand in our system.
And, you know, the sand can also be recycled. So the company also has a plan to recycle the sand by, there’s a few companies in Gujarat, they have a scrubbing mechanism with which the sand with which we are using can be scrubbed off and can be reused because that itself reduces the sand mining that has been done from the riverbanks, as well as, you know, the emissions that the trucks do while carrying the sand to our plants. So in our way, we have long term plans to reduce our carbon footprint, carbon emissions.
Mubina Kapasi: What are the day to day challenges that you come across, you know, when you’re running this foundry?
Akhilesh Saklecha: I would like to break the challenges which I work into two parts, you know, some challenges are within the locus of my control and some within the locus of, you know, these are externalities. So I’d start with the externalities, where we are working in a world where there is so many different things that is happening across, which is outside the locus of the control. Say, for example, anything happens in Europe or an ocean transit to a Red Sea, to container freight, to exchange rates, to the tariffs where in, you know, like, so a lot of things that are in the exports, which is due to the international factors also affect this business, which I reckon is a challenges for us as when we grow, we grow large.
So we have to have a risk mitigation strategy. In long term, we might be able to have not just manufacturing in one country. We have to have manufacturing in multiple countries to mitigate.
That might just be a mitigation strategy, but it’s just different strategies where we are working in terms of international forces that come into play. And within the locus of our control, you know, there are some challenges in the foundry as in terms of, you know, like getting skilled manpower. It’s not a very wonderful place to come work for, you know, so in a foundry.
But it is, it is, I can vouch for that. It is a career changing place. And, you know, there is a lot of, you get into metallurgy, you get into physical properties, you get, so there is a lot of experience exposure a candidate can get. But, you know, we do feel a bit challenged getting the right skill, manpower, right person for the job. And that might be a few challenges which we face internally.
Anirbhan De: So myself, Nirbande, actually, I’m working here as a senior manager, HR and admin.
I’m looking after entire corporate function as well as plant also. So Superior Foundry is a great place to work. There is a huge scope for learning for each and every person.
Myself, I have around 16 years of experience in HR fraternity. But since last one, one and a half years, I’m working with Superiron. So I am learning lots from this company.
Rishabh Madhogarhia: My name is Rishabh Madhavadia. So I’m an intern here. I’ve been an intern for the past two months. So here I have learned quite a few things about management and everything. Here, if I will tell you, I started as an intern in December. From December till date, I can understand each and everything about cast iron, about ductile iron, about the different types of materials involved.
Akhilesh Saklecha: I have talked to each and every HRD and personally understood what we can learn from this industry. Looking ahead, Superiron Foundry aims to become a multinational leader in castings, evolving from a manufacturer to a global distributor with a streamlined supply chain. Our vision is clear. We want to expand. But we would be very selective in terms of our growth, in terms of places where we choose to expand, wherein we have the management bandwidth. But in the next 10 years or so, you might be walking in and seeing that SIF is a multinational. That’s what the vision is.