Everest Kanto Cylinder (EKC) is a leader in the industrial and CNG cylinders manufacturing business in India. It commands an overall market share of 85% in CNG cylinder industry & is well placed to tap the growing market for environment-friendly Compressed Natural Gas (CNG) applications.
Compressed Natural Gas (CNG) offers a feasible alternative to petroleum fuels in vehicles. CNG is a source of mobile-energy, which can be easily supplied on a mass scale at affordable prices. Due to its inherent clean properties, the substitution of petrol & diesel by CNG is advantageous in not only enhancing energy security but also in cutting harmful GHG emissions.
Roughly 800,000 vehicles in Pakistan run on compressed natural gas (CNG). Each needs a specialised cylinder where the CNG is stored under high pressure. And, an Indian company — Everest Kanto Cylinders — is controlling 65 per cent of this market.The company makes CNG cylinders in India and Dubai and sells them in Malaysia, Thailand, several Gulf countries and CIS nations, besides Pakistan.
Everest Kanto’s story turned out differently because its founder chairman and managing director P.K. Khurana spotted a good opportunity in South America. Here, Brazil and Argentina were using CNG as a low-cost, environment-friendly fuel for automobiles, and had approximately 10,00,000 CNG vehicles on their roads. Wondering whether CNG would catch on in India as well, Khurana sent study teams to South America and the US. Initial research convinced him that this would be a good business opportunity in India.
Leading cylinder manufacturer Everest Kanto (plans to invest Rs 1.5-1.75 billion on capacity expansion across its plants in US, Dubai and India.The company expects to clock 35% increase in volumes and 50% increase in earnings in the current fiscal. Also company`s wholly owned subsidiary in China has successfully completed the trial production phase and commercial production has been already started.
EKC is ramping up its capacity to enhance its market share and is also planning to exploit other markets such as Iran and China, where a well timed capacity expansion would drive a ~36.8% EPS CAGR over FY08-FY10E.