By Roop Karnani

A virtual extension of a real world domain business. That's what the Pune-based House of Geras (1999-2000 turnover: Rs 105 crore) is trying to achieve with indiaconstruction.com.

The company behind the site is Construction Portal Pvt. Ltd (CPPL), in which the Geras own 87.50 per cent and the Housing Development Finance Corporation (HDFC), 12.50 per cent. HDFC acquired its stake for a Rs 3 crore investment, which puts CPPL's valuation at Rs 24 crore. IndiaConstruction is a vertical b2b portal which serves to link the buyers (read: builders), with the suppliers (read: sellers of cement, sand, ceramic tiles, and all other inputs).

A recent report by the Indian Banks' Association has put the annual turnover of the construction industry at a whopping Rs 2,10,000 crore, and pegs its growth rate at 15 per cent a year. Says Kumar Gera, 54, Chairman, CPPL: ''Almost two-thirds of this figure comes from material costs. Thus, we are looking at a market of Rs 1,40,000 crore.'' Enough to justify the existence of a b2b infomediary.

Width is all. The key to the success of an infomediary like IndiaConstruction is the exhaustiveness of its listing. In the three weeks since the site's launch on April 16, 2000, CPPL has held six (three buyer and three seller) meets in Pune, Mumbai, and Chennai. Over the next six months, these meets will be replicated in 17 other cities. The objective: to get 60 per cent of the estimated 50,000 suppliers in these 20 cities to register themselves with IndiaConstruction. Explains Rohit Gera, 31, CEO, CPPL: ''For the first three months, this registration will be free. After that, we will charge suppliers Rs 1,800 a year for registration.'' And buyers register free.

Suppliers who register will appear under one or more of the 48 categories under which construction materials have been classified. A search engine helps buyers find exactly what they want. That done, they can post their requirements and click the submit button to send the information to sellers.

The ideal result? Quotes from several suppliers within 24 hours. Says Rohit: ''Our objective is to reduce costs and lead-times at the buyer's end and increase sales at the supplier's end.'' Still, with 600 suppliers registered at the time of the launch, and 1,000 a week later, IndiaConstruction must ramp up rapidly to meet its target of 30,000 suppliers by October, 2000.

Here's where the HDFC link kicks in. Says Satish Mehta, 46, General Manager (Business Development), HDFC, who sits on the CPPL board: ''We have 60 branches across the country. These will help CPPL get more suppliers to register.'' That, the company's expansion plans-it plans to raise its staff strength from 12 to 140, and its number of branches from three to 20-and a promotional budget of Rs 1.5 crore in the next six months should help.

The deal is all. But it isn't just as a transaction medium that IndiaConstruction hopes to make its mark; the site also wishes to serve as an advertising medium. Thus, the product-brochure section displays brochures of companies involved in the manufacture of construction material. Two weeks after its launch, the site boasted 500 brochures from companies like Hindustan Ceramics, EID Parry, Spartek, Rajshree Cement, and Bosch. Says Nikhil Gera, 29, Director (Marketing) CPPL: ''Right now, this service is free but, eventually, we propose to charge companies a small fee to display their brochures.'' Brochure displays, however, will account for just a fraction of the site's revenue-streams. The bulk of IndiaConstruction's revenues will arise from commissions: CPPL plans to charge a commission ranging between 0.25 per cent and 0.45 per cent of the transacted value.

However, with the majority of suppliers likely to be off-line, IndiaConstruction hasn't taken any chances with the technology. Thus, once a customer generates a short-list of suppliers by using the search utility and posts his requirements, this is converted into an e-mail message and forwarded to the seller. That isn't all. IndiaConstruction's main Web-server is connected to fax servers in each of the 20 cities in which it operates. Thus, even if a supplier does not have an e-mail address, the customer's requirement can be faxed to him.

And the company proposes to use the Short Messaging System to even send these messages to the suppliers' pagers and mobile phones. Explains Kumar: ''Given the low penetration of the Net, it is necessary to use this kind of technology to reach our suppliers.'' Sure, but will technology and reach alone suffice?

The real test for CPPL will be the quality of service. For, if IndiaConstruction is able to do what it promises to, buyers are certain to flock to it. Agrees Rajendara Jog, 32, Executive Director of the Rs 113 crore Jog Engineering: ''If we want to place a large order for cement, say, 30,000 bags, it takes our entire purchase department four to five days to just identify the best supplier. If CPPL's claims are true, it will probably take one man less than a day to do so.''

Evidently, there is a viable commercial model behind the IndiaConstruction idea. Whether that morphs the concept into a 100-storey skyscraper or a modest terappin station is a function of how many customers CPPL can get to click on, well, bricks.

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