Arm Welders is diversifying to grow

Pune-based Arm Welders, a supplier of welding equipment and automation   to automotive and other sectors, is embarking on an ambitious consolidation and expansion plan. The company, led by CEO Brijesh Khanderia, plans to move to a new, 2 lakh sq. ft. facility within the Pune district to combine three of its existing plants under one roof.

Currently, the company operates a 20,000 sq. ft. facility that integrates the production of welding guns, a corporate office, a design centre, and R&D. A 50,000 sq. ft. plant nearby, focuses on manufacturing machines and automation systems, while a separate 8,000 sq. ft. unit handles critical parts machining.

The company is yet to identify the site for its new operations, but expects the new facility to streamline operations and free up space for dedicated development
areas. Khanderia said the development of control systems, as distinct from mechanical production processes, requires a segregated environment. The move will also position Arm Welders to pursue new product lines and explore
opportunities in additional sectors.

Arm Welders is trying to go beyond its core business of sheet metal welding for automotive including giants like Tata Motors, Mahindra & Mahindra, Toyota, Volkswagen, and the Indian Railways. It wants to get into specialised
welding solutions such as laser welding and special material welding technologies, catering to diverse industries and targeting the global market, and the extra
space would come in handy. “This would be an added capacity for us to expand with joint ventures in different segments,” said Khanderia, adding that the market potential for Indian automotive welding and automation currently stands at over Rs 1,000 crore. However, this multiplies several times when other sectors are included in the count.

Arm Welders boasts an impressive growth, averaging a CAGR of 35-40% over the past three years. Looking ahead, it maintains a bullish outlook, aiming for 30% growth in the current year and a sustained minimum CAGR of 20-25%
over the next five years. The company’s current employee strength is around 180.

Global expansion: Springboard Vietnam

While Arm Welders’ current exports are negligible, the management has ambitious plans to increase it to 20-25% of revenue within the next few years. This international push hinges on a strategic foray into Vietnam, spearheaded
by an order from Skoda. Arm Welders supplied the welding guns, while another company handled the complete automation integration in this case.

The Vietnam project proved pivotal for two reasons.
First, it granted Arm Welders an entry into a burgeoning market. Second, by establishing itself as an early mover amidst a landscape dominated by Japanese and Chinese players, the company secured a significant advantage.
Buoyed by this success, Arm Welders plans to establish its Vietnamese presence. The current “distributed operation” model will be replaced with a dedicated, fully-owned office, strategically positioned to capture the entire Vietnamese market.
The Vietnam operation will serve as a springboard for the company’s broader Southeast Asian ambitions.

Leveraging the knowledge gathered, Arm Welders is planning a measured regional expansion, targeting Thailand and Indonesia next. The push can potentially extend to Latin America and other geographies as well. “The vision in the next five years is to make Arm Welders a global supermarket which will always have a product which (a client) wants… This means efficiency, quality, lower cost of ownership and a higher speed at which the products get delivered,” Khanderia stated.

Tackles e-Mobility challenges: R&D focuses on new-age materials

As the conversation shifts towards the electric vehicle (EV) revolution and the rise of alternative fuels, Arm Welders’ CEO Brijesh Khanderia acknowledges the unique welding challenges posed by new-age materials. Lightweight alloys, high-sensitivity materials, and the widespread adoption of aluminium in lightweight vehicle segments, all demand a departure from traditional steel welding approaches.

These new materials necessitate precise welding techniques and specialised venting methods. To address this evolving landscape, Arm Welders boasts a dedicated R&D department continuously developing products, specifically tailored for welding these next-generation materials. Their R&D team conducts extensive research, experimentation and trials, to ensure their products deliver optimal performance when working with these novel materials.

The company also designs and manufactures its own controllers, the “brains” of the machines that regulate current delivery and monitor the welding process. This
in-house control system fosters seamless integration with the welding guns, ultimately optimising the entire welding experience, he explained.

A welding powerhouse charts a course for the future

Arm Products was founded in 1977 by Khanderia’s father, Atul. The company initially focused on control transformers, supplying them to major control gun
manufacturers. Little did they know this would pave the way for their future welding enterprise.

However, a pivotal moment arrived in 1991-1992 when Tata Motors’ desire for self-made welding equipment spurred the development of water-cooled transformers specifically for spot welding. This innovation not only brought in Tata Motors as the company’s first and biggest client, but also charted a new course for
the company.

Brijesh Khanderia, joining the firm in 1998-1999 after completing his electronics and telecommunications engineering degree, recognised the potential of the
transformer expertise. In 2001-2002, he spearheaded a move into new welding products, all indigenously designed and manufactured. Soon after, the company
started a second factory and renamed itself Arm Welders, a name that better reflected its core offerings. As the company flourished, its customer base expanded to include major automotive OEMs like Mahindra & Mahindra, Toyota, Volkswagen, and others.

Recognising the growing need for efficient production and reduced reliance on skilled labour, Arm Welders began developing automation systems in 2011-12. This expansion led to the construction of their third factory in 2015, dedicated solely to automation systems and turnkey projects. Today, Arm Welders operates as a diversified entity with three distinct verticals. The product vertical supplies
welding equipment, while the automation vertical delivers complete turnkey projects.

Recognising the criticality of aftersales support, the company also maintains a dedicated sparesand- services vertical to minimise customer downtime. Before 2011-2012, it relied heavily on the automotive industry, generating 90% of its revenue from this sector. However, since then, it has diversified into other
underserved segments like railways, furniture, construction and general fabrication. This strategic move identified unmet needs and positioned Arm Welders as a solution provider, offering complete turnkey projects to nonautomotive industries as well. 

This feature was first published in Autocar Professional’s July 1, 2024 issue.

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