Indian Automotive Supplier Report

SupplierBusiness
The Indian Supplier Report

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IHS SupplierBusiness is a specialist consultancy providing analysis of the automotive industry for the automotive industry. Contributors to this report include: Alex Boekestyn, Gaby Leigh, Stewart Pedder, Om Sharma. 2011 IHS Inc. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, IHS Global Ltd. This report is the product of extensive research work. It is protected by copyright under the Copyright, Designs and Patents Act 1988. The authors of these research reports are drawn from a wide range of professional disciplines. The facts within this report are believed to be correct at the time of publication but cannot be guaranteed. All information within this study has been reasonably verified to the authors and publishers ability, but neither accept responsibility for loss arising from decisions based on this report. This title is provided to you on a single-user basis, supplied on the strict understanding that each title is not to be copied or shared. Alternatively, our reports can be shared within departments or entire corporations via a cost-effective multi-user license. Multi-user licenses can also save you money by avoiding unnecessary order duplication. To further add value all multi-user copies are hosted on a password protected extranet for your department or company saving you time, resources and effort when sharing research with your colleagues. To find out more about multi-user pricing, please contact Sarah Graham; sarah.graham@ihs.com
CONTENTS
Executive Summary ....................................................................................................... 11 The Indian automotive industry ...................................................................................... 12 Evolution of Indian automotive industry ..................................................................... 13 Two-wheelers dominate........................................................................................... 14 Three-wheelers ........................................................................................................ 15 Light vehicles .......................................................................................................... 16 Medium and heavy duty commercial vehicle............................................................ 21 Growing competition in all segments........................................................................... 25 Moderation in vehicle sales ......................................................................................... 26 High inflation and interest rates ............................................................................... 26 Rising fuel prices ..................................................................................................... 27 Frequent strikes ....................................................................................................... 28 Industry response ........................................................................................................ 29 Medium to long-term outlook remains bright ............................................................... 30 Vehicle density remains abysmally low in India........................................................ 30 Vehicle sales and production forecast........................................................................... 31 India continues to attract new players ...................................................................... 32 Investment plans of automakers ............................................................................... 33 Indias automotive component industry .......................................................................... 37 Strong growth after global slowdown........................................................................... 37 Growth moderation in 2011-12 ................................................................................... 42 Indian supplier industry continues to attract investment ............................................... 44 Investments ................................................................................................................ 46 Joint-ventures ............................................................................................................. 51 Mergers & Acquisitions............................................................................................... 53 OEM-supplier relationship.............................................................................................. 56 Involvement of automakers in supplier development .................................................... 56 Direct involvement declines post-liberalisation............................................................. 57 Greater localisation driving better OEM-supplier relationship ...................................... 58 Technology remains a big challenge for Indian suppliers .............................................. 59 Automakers close-knit suppliers ................................................................................. 59 Cost, quality, delivery (QCD) ...................................................................................... 60 Indias emergence as a sourcing hub ............................................................................ 61 Automotive cluster development ..................................................................................... 64 Northern region .......................................................................................................... 65 Southern region .......................................................................................................... 66
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Western region ........................................................................................................... 66 Growth of clusters....................................................................................................... 66 Gujarat emerging as major cluster ............................................................................... 67 Competition among clusters ........................................................................................ 68 Challenges for the Indian Supplier Industry ..................................................................... 72 Demand fluctuations................................................................................................... 72 Capacity expansion ..................................................................................................... 72 Fluctuating raw materials prices .................................................................................. 73 Exchange rate volatility............................................................................................... 75 Rising operating costs ................................................................................................. 77 R&D capabilities ........................................................................................................ 78 Trade practices ........................................................................................................... 79 Skilled manpower shortage ......................................................................................... 79 Growing competition .................................................................................................. 80 Government Policy ........................................................................................................ 82 Phase 1: Draconian regulations during 1947-1980 .................................................... 82 Phase 2: Limited liberalisation during 1980-1990...................................................... 82 Phase 3: Economic reforms of 1991 and afterwards .................................................. 82 Policy environment ..................................................................................................... 83 Tax policy ............................................................................................................... 83 Union Budget for fiscal year 2012-13........................................................................ 85 Trade Policy ............................................................................................................... 89 Major bilateral and multi-lateral trade agreements .................................................... 90 State policies ........................................................................................................... 92 Labour laws ............................................................................................................ 93 Land Acquisitions ................................................................................................... 94 Policy on fuel pricing............................................................................................... 95 Industry regulations................................................................................................. 96 Recent developments .................................................................................................. 99 Auto Policy 2002..................................................................................................... 99 Automotive Mission Plan 2006-16 ........................................................................... 99 National Automotive Board .................................................................................... 99 National Manufacturing Policy............................................................................... 100 Government Initiatives on skills development ......................................................... 100 Infrastructure development......................................................................................... 101 Transportation ....................................................................................................... 101 Power .................................................................................................................... 104 Indias competitiveness in term of infrastructure in BRICS countries ........................... 105
Survey of Indian Supplier Industry ................................................................................. 107 Interviews ..................................................................................................................... 118 Automakers ............................................................................................................... 118 Suppliers.................................................................................................................... 118 Michael Boneham, Managing Director and Sandeep Sanyal, Executive Director, Operations; Ford Motor India .................................................................................... 119 Rahul Bharti Head, Corporate Planning & Investor Relations, Maruti Suzuki........... 122 Bharat Parekh, Chief, Strategic Sourcing, Tata Motors ............................................... 125 Neeraj Kanwar, Vice Chairman & Managing Director, Apollo Tyres .......................... 128 Shvetal Vakil, Executive Director, Setco Automotive .................................................. 133 J Sivkumar, Pricol...................................................................................................... 135 Shailandra Bohra, Marketing Director, Bohra Rubber ................................................. 138 Amit Mukherjee, Deputy Executive Director, Automotive Component Manufacturers Association of India (ACMA) .................................................................................... 141 Supplier Profiles ............................................................................................................ 145 Aisin Seiki ................................................................................................................. 145 Alicon Castalloy ........................................................................................................ 148 Amalgamations Group............................................................................................... 150 Amtek Auto............................................................................................................... 153 Anand Group ............................................................................................................ 157 Apollo Tyres .............................................................................................................. 161 Ashai India Glass ...................................................................................................... 165 Ashok Iron Works ..................................................................................................... 168 Ashok Minda Group .................................................................................................. 169 Auto Ignition ............................................................................................................. 173 Automotive Stampings............................................................................................... 175 Axles India ................................................................................................................ 178 Bagla Group .............................................................................................................. 180 Bajaj Motors ........................................................................................................ 118182 Banco Products ...................................................................................................... 11883 Bharat Forge.............................................................................................................. 185 Bharat Gears.............................................................................................................. 189 Bharat Seats ............................................................................................................... 191 Bhushan Steel ............................................................................................................ 194 Birla Corporation ....................................................................................................... 197 Birla Tyres ................................................................................................................. 199 Bohra Rubber ............................................................................................................ 201 Bosch India ............................................................................................................... 203
Brakes India............................................................................................................... 206 Bridgestone India ....................................................................................................... 208 Caparo India ............................................................................................................. 211 Clutch Auto ............................................................................................................... 214 Continental................................................................................................................ 217 DCM Engineering ..................................................................................................... 220 Delphi TVS ............................................................................................................... 222 Delphi ....................................................................................................................... 224 Denso India ............................................................................................................... 227 Endurance Systems .................................................................................................... 230 EXECY India ............................................................................................................ 234 Exide Industries ......................................................................................................... 236 Faurecia .................................................................................................................... 240 Federal Mogul Goetze ............................................................................................... 243 Fenner India .............................................................................................................. 246 Fiem .......................................................................................................................... 248 Gabriel India ............................................................................................................. 251 GKN Driveline India ................................................................................................. 254 Goodyear India ......................................................................................................... 256 Guru Nanak Auto...................................................................................................... 259 Halonix ..................................................................................................................... 261 Harita Seating ............................................................................................................ 264 Hi-Tech Gears ........................................................................................................... 266 Imperial Auto ............................................................................................................ 268 IP Rings .................................................................................................................... 270 Jamna Auto ............................................................................................................... 272 Jay Bharat Maruti ...................................................................................................... 276 Jay-Ushin .................................................................................................................. 278 Jaya Hind .................................................................................................................. 280 JK Tyre ..................................................................................................................... 282 JKM Automotive....................................................................................................... 285 Johnson Matthey ....................................................................................................... 288 Kalyani Forge ............................................................................................................ 290 Kinetic Engineering ................................................................................................... 292 Krishna Maruti .......................................................................................................... 295 LG Balakrishnan ....................................................................................................... 298 Lucas TVS ................................................................................................................. 301 Lumax Automotive Systems ...................................................................................... 304
Lumax Industries ....................................................................................................... 306 Machino Plastics........................................................................................................ 309 Madras Engineering ................................................................................................... 311 Magna ....................................................................................................................... 313 Magneti Marelli ......................................................................................................... 316 Mahindra Hinoday .................................................................................................... 319 Mahindra Systech ...................................................................................................... 320 Mahindra Composities ............................................................................................... 322 MAHLE .................................................................................................................... 324 Mark Exhaust ............................................................................................................ 328 MRF ......................................................................................................................... 330 Manjal Auto .............................................................................................................. 333 Munjal Showa ........................................................................................................... 335 Neolite ZKW Lightings.............................................................................................. 337 NK Minda Group ...................................................................................................... 340 NRB Bearings ............................................................................................................ 344 Omax Auto ............................................................................................................... 346 Panasonic Automotive ............................................................................................... 348 Pricol......................................................................................................................... 353 Ramakrishna Forgings ............................................................................................... 356 Rane Brake Linings.................................................................................................... 358 Rane Engine Valves ................................................................................................... 360 Rasandik ................................................................................................................... 362 Remsons .................................................................................................................... 364 Rico Auto .................................................................................................................. 366 Ring Plus Aqua.......................................................................................................... 369 RSB Transmissions .................................................................................................... 371 Ruia Group ............................................................................................................... 373 Saint-Gobain ............................................................................................................. 376 Samvardhan Motherson Group .................................................................................. 378 Sandhar Technologies ................................................................................................ 381 Setco Automotive ...................................................................................................... 384 Shriram Pistons & Rings ............................................................................................ 387 Sigma Group ............................................................................................................. 389 SKF India.................................................................................................................. 391 Sona Koyo................................................................................................................. 394 Steel Strips Wheels..................................................................................................... 398 Sterling Tools ............................................................................................................ 401
Subros ....................................................................................................................... 403 Sunbeam Auto ........................................................................................................... 406 Sundram Clayton....................................................................................................... 408 Sundram Fasteners .................................................................................................... 411 Suprajit Engineering .................................................................................................. 414 Talbros Automotive ................................................................................................... 417 Tata AutoComp......................................................................................................... 420 Tata Ficosa ................................................................................................................ 425 Tata Johnson Controls ............................................................................................... 427 Tata Steel .................................................................................................................. 429 Tata Toyo Radiator ................................................................................................... 433 Timken ...................................................................................................................... 435 TRW Automotive ...................................................................................................... 438 Tube Investments....................................................................................................... 441 UCAL Fuel Systems .................................................................................................. 444 Valeo ......................................................................................................................... 447 Varroc Group ............................................................................................................ 450 Victor Gaskets ........................................................................................................... 453 Visteon ...................................................................................................................... 455 WABCO India .......................................................................................................... 458 Wheels India ............................................................................................................. 461 ZF India .................................................................................................................... 464
LIST OF FIGURES AND TABLES

Figure 1: Vehicle Sales and Production in India (2002-2011) ............................................ 12 Figure 2: Two-wheelers dominates Indian automotive market both in term of sales and production...................................................................................................................... 14 Figure 3: Two-wheeler Sales and Production in India (2004-2011) ................................... 15 Figure 4: Three-wheeler Sales and Production in India (2004-2011) ................................. 16 Figure 5: Indian Light Vehicle Sales ................................................................................ 17 Figure 6: Indian Light vehicle Production ....................................................................... 17 Figure 7: Vehicles Sales Percentage segment in India (2011) ............................................ 18 Figure 8: Audi, BMW and Mercedes-Benz sales in India (2009-2011, 2016, and 2022) ..... 20 Figure 9: India Light Vehicles Sales Forecast................................................................... 21 Figure 10: India Light Vehicles Production Forecast........................................................ 21 Figure 11: Indian Medium & Heavy Commercial Vehicle Sales and Production (2002-2011) ...................................................................................................................................... 22
Figure 12: Indian Medium & Heavy Commercial Vehicle Sales and Production Forecast (2012-2022) .................................................................................................................... 23 Figure 13: Indian Vehicle Exports (2004-2011) ................................................................ 24 Figure 14: India's Consumer Price Inflation (Jan-09 to Jan-12)......................................... 27 Figure 15: India's Central Bank Lending Rates (Jan-09 to Sep-11) .................................... 27 Figure 16: Indian Petrol and Diesel prices (Mar-10 to Dec-11) ......................................... 28 Figure 17: BRIC GDP Forecast (2008-2014) ................................................................... 30 Figure 18: India has one of the lowest car densities in the world....................................... 31 Figure 19: Vehicle Sales and Production Forecast in India (2012-2022) ............................ 32 Figure 20: Turnover of India's automotive parts industry ................................................. 37 Figure 21: Components Manufactured in India by use in Vehicle ..................................... 38 Figure 22: Indias Auto Component Export Destinations Percent Share (FY2010-2011) ... 39 Figure 23: Indias Auto Component Export Destinations Percent Share (FY2009-2010) ... 39 Figure 24: Indias Auto Component Import Locations Percent Share (FY2010-2011) ....... 40 Figure 25: Indias Auto Component Import Locations Percent Share (FY2009-2010) ....... 40 Figure 26: Indian export and import value in USD (2005-2011) ....................................... 41 Figure 27: Two-wheelers and commercial vehicles continue to drive industry growth , passenger vehicles segment recorded impressive recovery ................................................ 43 Figure 28: Production of Light Vehicle Engines and Transmissions in India ..................... 44 Figure 29: Indian Supplier Investments in USD (2005-2011) ............................................ 45 Figure 30: Map of Automotive Clusters in India .............................................................. 70 Figure 31: Raw Material Prices ....................................................................................... 74 Figure 32: Exchange Rate INR against USD (Jan-10 to Jan-12) .................................... 76 Figure 33: Exchange Rate INR against EUR (Jan-10 to Jan-12) .................................... 76 Figure 34: Exchange Rate INR against JPY (Jan-10 to Jan-12)...................................... 76 Figure 35: Cargo handled at major Indian ports from 2004-05 to 2010-11 ........................ 103 Figure 36: Indian ranks third in terms of infrastructure among BRIC countries................ 105 Figure 37: Survey More than 60% of suppliers expect Indias automotive market to grow at 10-20% over the next five years .................................................................................. 107 Figure 38: Survey High inflation and interest rates very important challenges for suppliers ........................................................................................................................ 108 Figure 39: Survey Retaining talent most challenging issue for suppliers ...................... 109 Figure 40: Survey Volatility in OEM demand, input costs fluctuation weigh heavy on suppliers minds............................................................................................................. 110 Figure 41: Survey Maruti Suzuki, Volkswagen most attractive OEMs among suppliers . 111 Figure 42: Survey Toyota, Volkswagen and Honda most exacting about testing and validation of components............................................................................................... 112 Figure 43: Survey Maruti Suzuki, Volkswagen and Toyota rank high on demanding supplier expansion ......................................................................................................... 113 Figure 44: Survey Hyundai ranks high on contract finalisation with suppliers ............... 114 Figure 45: Survey Maruti Suzuki, Hyundai quicker with supplier payments.................. 115 Figure 46: Survey All OEMs good in terms of payment terms negotiation with suppliers ..................................................................................................................................... 116 Figure 47: Survey Ford, Toyota rank high on return on investment they offer suppliers ..................................................................................................................................... 117
Table 1: Investment plans in India .................................................................................. 34 Table 2: Maruti Suzuki has 19 JV vendors, 11 of which are located in its Supplier Park enabling component delivery not only just-in-time but also just-in-sequence ..................... 56 Table 3: List of Automotive Clusters in India .................................................................. 71 Table 4: Indian Suppliers R&D Spend compared with Global Suppliers .......................... 78 Table 5: Presence of major global suppliers in India ......................................................... 81 Table 6: Budget 2012-13: Highlight 2012-13 .................................................................... 87 Table 7: Annual Energy Generation ............................................................................... 104
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EXECUTIVE SUMMARY
The Indian automotive industry is widely expected to remain on a high-growth trajectory in the coming years. The industry has achieved rapid productivity improvements and has also expanded its share in global markets over the past few years. Nevertheless, the rapid growth has also resulted in the entry of dynamic foreign automakers and suppliers, who have raised the bar for their Indian counterparts in terms of quality and pricing. The third edition of the Indian Supplier Report offers an insight into the critical constraints that can rein in the Indian supplier industry from achieving new heights, especially at a juncture when global automakers are considering making India a manufacturing and export hub for their global aspirations. The conclusions of the Indian Supplier Report are based on comprehensive first hand interaction with industry officials vehicle and auto parts makers across all the three tiers. The component suppliers who form a vital link in the automotive supply chain have provided all the efforts required for the consistent growth of the automotive industry. However, the supplier industry itself has undergone tremendous change, especially in the past decade, driven by increasing competition from global suppliers and changing relationships with automakers. Previously, automakers invested in India primarily to serve local demand. Advantages such as low cost production and presence of a strong supply base though not too advanced have driven many automakers to see India as a future manufacturing hub, especially for low-cost vehicles to meet export demand. IHS expects vehicle sales in India to reach 8.3 million units by 2022, more than double compared with 3.2 million units in 2011. But bigger roles bring bigger challenges. In India, both automakers and suppliers will need to invest heavily to meet the ever-increasing demand for vehicles. Expansion will be an uphill task for the smaller, less-attractive suppliers, especially in an environment mired with high interest rates and operating expenses. The domestic suppliers need to reinvent themselves to match the quality and cost expectations of automakers, who are striving to economise through high-level of localisation. For Indian suppliers, achieving all that hinges heavily on government policies at all levels central, state and local. For instance, Indias step to deregulate petrol prices nearly two years ago caused a significant gap between diesel and petrol (gasoline) prices in the country, shifting demand significantly towards dieselpowered vehicles. This caught many automakers and suppliers off guard. However, the Indian government keeps a close eye on the challenges that the auto industry faces. During the economic slowdown of 2008-09, India took several measures, including excise duty cuts, to prop up the automotive industry. IHS believes that the Indian government is serious about the introduction of industry-friendly tax reforms such as the Direct Tax Code (DTC) and Goods and Service Tax (GST). The insights offered in the Indian Supplier Report are supported by a survey conducted among more than 70 senior industry executives mostly tier one suppliers. The survey offers a quick look into the macroeconomic issues in India such as government policy, inflation and interest rates to operating issues such as raising capital, gaining technology and growing labour unrest.
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THE INDIAN AUTOMOTIVE INDUSTRY

The automotive industry in India has witnessed phenomenal growth in the three decades after the countrys government partially opened the highly regulated domestic auto market in the early 1980s and especially after the comprehensive economic reforms in 1991. Within a relatively short period, India has emerged as the worlds second largest producer of twowheelers, fifth largest producer of commercial vehicles and sixth largest producer of passenger cars. The country is also the largest producer of tractors. Currently there are 20 manufacturers of passenger cars and multi-utility vehicles, 15 manufacturers of commercial vehicles, eight manufacturers of two-wheelers and seven manufacturers of three-wheelers in the country. The significance of the automotive industry as a revenue and employment generator has also grown over the years. According to the Society of Indian Automobile Manufacturers (SIAM), a local association of automakers, the turnover of the Indian automotive industry crossed INR3.1trn (USD68.3bn, 31 March 2011) in financial year 2011-12, which translates into more than 6% of Indias gross domestic product (GDP). Presently, the auto industry accounts for around 17% of all indirect tax revenue the government collects each year. In addition, the auto industry provides direct and indirect employment to more than 17 million people in the country. The Indian automotive industry had a successful run throughout the previous decade except for a short period during the global economic slowdown. However, India was the first among the major automotive markets to return to growth when recovery began. Compared to other high-potential countries, India has moved on one of the fastest growth trajectories in terms of vehicle sales in the past few years. This is reflected in the fact that though India took seven years to reach around two million units in 2008 since crossing the one million units milestone for the first time in 2003 the country took just two years to exceed the three million units mark in 2010. Figure 1: Vehicle Sales and Production in India (2002-2011)
4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 2002 2003 2004 2005 Sales 2006 2007 2008 2009 2010 2011 Production
Figures for financial year ended 31 December; Source: IHS Automotive

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In 000 units
Vehicle production is also moving in unison with demand. Despite a worldwide production slump due to faltering demand and rising inventory during the global economic slowdown, automakers in India maintained their growth momentum. In 2011, vehicle production in the country surpassed 3.94 million units compared with 3.58 million in 2010, according to IHS Automotive. Besides strong domestic demand, the growth was driven by increase in vehicle exports, especially of passenger cars. The strong growth in vehicle production over the past several years has been possible due to the emergence of a solid supplier base in India. The Indian supplier industry has grown along with the domestic vehicle industry. According to Automotive Component Manufacturers of India (ACMA), an association of component suppliers, turnover of the Indian component industry reached INR1.8trn (USD40bn) in financial year 2010-11, up 34.2% compared with the previous financial year. The strong growth was driven by robust domestic demand for vehicles including two-wheelers and three-wheelers which recorded a nearly 26% increase to 15.5 million units, according to SIAM. Auto components exports, which saw a healthy surge of 54% to USD5.2bn, also contributed to the strong growth in sales during the financial year.
EVOLUTION OF INDIAN AUTOMOTIVE INDUSTRY

Today India is the second fastest-growing automotive market in the world after China with annual sales touching 3.25 million units. But around 30 years ago the sector was mired in antiquated government policies. Before 1980, the Indian government not only controlled production through licensing but also decided what type of vehicles to be produced and in what quantity, irrespective of consumer demand. Guided by its pro-socialistic approach, the government focused more on the development of low-cost public transportation. Policies were designed to promote growth of two-wheelers, three-wheelers and buses. In addition, trucks received attention from the government as they were considered vital for transportation of goods. The government discouraged the growth of passenger cars viewing them as a luxury, affordable to only a few affluent people. The Indian government also controlled the number of automakers that could operate in the country. Through extensive use of licensing it kept the number of players to a minimum. Besides, it strictly prohibited import of vehicles and components fearing that it would result in outflow of hard-earned foreign currencies. However, the governments attitude started changing in the early 1980s when it allowed existing players to decide on their product-mix in order to better utilise their available capacity under broad-banding policy. In early 1980s, the government partially opened the automotive industry which resulted in the entrance of several Japanese automakers in Indias two-wheeler and four-wheeler market. During this period of partial liberalisation, India saw the emergence of two highly successful jointventures (JVs) between Indian and Japanese companies Maruti Udyog (now MarutiSuzuki) and Hero Honda (now Hero MotoCorp, after the exit of Honda in December 2010). Maruti Suzuki brought about a paradigm shift in the Indian automotive industry. The firstmover advantage helped Maruti Suzuki establish a strong foothold in the Indian market. The automaker continues to account for nearly one-third of all light vehicle sales in India every year it sold 931,200 cars in India in 2011. Hero-Honda, the other JV, has also recorded phenomenal growth in India over the years, becoming the worlds largest two-
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wheeler manufacturer. In financial year 2011-12, the company sold 5.4 million twowheelers in India, representing a market share of 45.8%. The economic reforms of 1991 provided automakersdomestic and foreignwith more headroom to grow, allowing them to undertake demand-based manufacturing in India. The government initially allowed foreign direct investment (FDI) up to 51% through automatic approval; but after 10 years the limit was raised to 100%, implying that foreign automakers required no approval from the countrys Foreign Investment Promotion Board (FIPB) to enter India.
Two-wheelers dominate
The Indian automotive market is dominated by two-wheelers motorcycles and scooters. The segment currently accounts for around three-quarters of total vehicle sales in the country. According to SIAM, in financial year 2010-11, overall India sold 15.5 million vehicles, of which 11.8 million, or 76%, were two-wheelers (see Figure 2). Sales of twowheelers in India nearly doubled from 6.2 million in 2004-05 to 11.8 million in 2010-11, driven by robust growth in domestic demand, especially in rural areas. Figure 2: Two-wheelers dominates Indian automotive market both in term of sales and production
Breakup of Indian automotive market by sales 3.4% 16.2% Breakup of Indian automotive market by prodution 4.5% 16.7%
4.4%
4.2%
76.0%
74.6%
Passenger Vehicles Two Wheelers
Commercial Vehicles Three Wheelers
Passenger Vehicles Two Wheelers
Commercial Vehicles Three Wheelers
Figures for financial year 2010-11; Source: SIAM Production of two-wheelers also grew robustly from 8.5 million units in 2004-05 to 13.4 million in 2010-11. Besides surging domestic demand, two-wheeler makers are seeing strong demand in international markets, especially in south-east Asia, Africa and Latin America. The segment is dominated by Hero MotoCorp, Bajaj Auto, TVS, Honda Motorcycle and Scooter India and Yamaha.
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Figure 3: Two-wheeler Sales and Production in India (2004-2011)

16,000 14,000 12,000 In 000 units 10,000 8,000 6,000 4,000 2,000 0 2004-05 2005-06 2006-07 Sales 2007-08 Production 2008-09 2009-10 2010-11
Figures for year ending 31 March; Source: SIAM
Three-wheelers
In terms of sales, the size of the three-wheeler segment is larger than the heavy commercial vehicles segment. While sales of three-wheelers increased from 307,862 units in 2004-05 to 526,022 in 2010-11, an increase of 70.9%, their production more than doubled from 374,000 units to 800,000 during the period. Strong exports have also contributed to the growth of this segment in India. Major players in the three-wheeler segment include Piaggio, Baja Auto, Mahindra & Mahindra (M&M), TVS Motors and Atul Motors. Together the two-wheeler and three-wheeler segments account for nearly 80% of total vehicles produced and sold In India. The two segments have been largely immune to the volatility in demand. A majority of domestic parts suppliers cater to these segments, besides passenger cars and commercial vehicles. Supplying to all segments provides some sort of a cushion for the local suppliers in the sense that a decline in one segment is sometimes compensated by growth in the other.
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Figure 4: Three-wheeler Sales and Production in India (2004-2011)

900 800 700 600 In '000 units 500 400 300 200 100 0 2004-05 2005-06 2006-07 Sales 2007-08 Production 2008-09 2009-10 2010-11
Figures for year ending 31 March; Source: SIAM
Light vehicles
The light vehicles (LV) segment, which includes passenger cars, utility vehicles (UVs), and light commercial vehicles (LCV) weighing under six tonnes, has recorded a strong growth in the past 10 years, driven by high single-digit growth of the Indian economy for the larger part of the decade. The segment managed to maintain its growth during the global financial crisis in late 2008 and early 2009. According to IHS Automotive, LV sales in India more than tripled from 801,000 units in 2002 to 2.91 million in 2011. In the LV segment, passenger cars account for more than 60% of total sales.
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Figure 5: Indian Light Vehicle Sales

3,500 3,000 2,500 In '000 units 2,000 1,500 1,000 500 0 2002 2003 2004 2005 2006 Cars LCVs 2007 2008 2009 2010 2011
Figures for year ending 31 December; Source: IHS Automotive Figure 6: Indian Light vehicle Production
4,000 3,500 3,000 In '000 units 2,500 2,000 1,500 1,000 500 0 2002 2003 2004 2005 2006 Car LTR 2007 2008 2009 2010 2011
Figures for year ending 31 December; Source: IHS Automotive LV production quadrupled from 820,000 units in 2002 to nearly 3.6 million units in 2011, boosted by high domestic and export demand (see Figure 6). The past three to four years have been particularly good production increased from 2.1 million units in 2008 to 3.6 million units in 2011. In the LV segment, production of passenger cars increased fourfold from slightly over half a million units in 2002 to 2.4 million units in 2011 while LCV production increased from 271,000 units to 1.2 million units during the same period. And
with many automakers lining up big investments in the country, these figures are set to go up even higher. Figure 7: Vehicles Sales Percentage segment in India (2011)
0.6% 0.1% 2.6%
12.4% 7.7%
A B C D 56.1% E F HVAN
20.5%
Figures for year ending 31 December 2011; Source: IHS Automotive
A Segment B Segment C Segment D Segment E Segment F Segment HVAN Segment
Includes cars, MPVs and SUVs (size<3,800mm) and Van (GWT<2t) Includes car and sportscars (3,700mm-4,200mm), MPVs (3,700mm-4,100mm), SUVs (3,700mm-4,200mm), pickups (<4,500mm), vans (<4,000mm) Includes cars, sportscars and MPVs (4,000mm-4,500mm), SUVs (3,800mm-4,600mm), pickups (4,501mm-5,100mm), vans (3,900mm-5,000mm) Includes cars, sportscars and MPVs (4,400mm-5,000mm), SUV (4,500mm-5,100mm), pickups (4,500mm-5,100mm), vans (GVW up to 2.8t) Includes cars, (4,500mm-5,100mm), sportscars (>4,500mm), MPVs (>4,900mm), SUVs (>4,800mm), vans (GVW2.8t-3.5t) Car and sportscars (all size) Vans (gross vehicle weight 3.5t-6t)
The Indian light vehicle market is dominated by A segment vehicles, less than 3,800mm in length, primarily including compact cars, sportscars, multi-purpose vehicles (MPVs), sportutility vehicles (SUVs), and vans with gross vehicle weight (GVW) of less than two tonnes. In 2011, India sold 1.6 million A segment vehicles, equivalent to 56.1% of total light vehicle sales. The B segment, with length in 3,700mm and 4,500mm range and which includes cars,
sportscars, MPVs and SUVs and vans, sold 596,000 units, or 20.5% of the total light vehicle sales, during 2011. The A and B segments together accounted for more than three-quarters of the total light vehicles sales in the country during 2011. The remaining one quarter was made up by C, D, E, F and HVAN segment vehicles. The LV segment is dominated by automakers such as Maruti-Suzuki, Tata Motors, Hyundai and M&M which together accounted for 77% of the total LVs sold in India during 2011. Though Maruti-Suzuki continues to dominate this segment, its grip has loosened. The companys market share in the LV segment declined from 41.2% in 2002 to 32% in 2011. The companys sales in India crossed one million units in 2010 but declined 11.6% to 931,200 in 2011. In the same year, Maruti-Suzukis sales were also impacted by the frequent strikes at its Manesar plant in Haryana which resulted in a cumulative production loss of 80,000 units. IHS Automotive forecasts further decline in Maruti-Suzukis market share to 27% by 2016. However, the company is expected to maintain its position as the leading automaker in the LV segment and protect its market share of above 25% in the medium to long run. Tata Motors, the second largest player in the LV segment, currently has 20.7% market share, thanks to its strong presence in both passenger cars and LCV segments the automaker sold 603,200 units in 2011, up 8.1% over 558,200 in 2010. Tata Motors forayed into the passenger car segment over ten years ago with its Indica hatchback. And in 2009, the company launched the ultra-cheap Nano, aiming to boost its market share. However, negative publicity following several cases of the car catching fire, affected Nanos sales. Although Tata Motor is far from selling the million Nanos a year it had initially targeted, sales have recently started moving in the right direction. Attractive marketing and financing facility pushed Nano sales from 59,500 in 2010 to 86,400 in 2011. South Koreas Hyundai Motor, who entered the Indian market in the late 1990s, has managed to establish itself as the countrys third largest automaker through successful small cars such as Santro, i10 and i20 with a market share of 12.3% in 2011. The company is now looking to further consolidate its presence in the small car segment through models like EON (launched in October 2011), which is positioned below its aging Santro model and directly pitched against Maruti Suzukis Alto, the largest-selling small car in India. M&M has also grown significantly in the past decade, thanks to its price-competitive multipurpose vehicles (MPVs) and sport-utility vehicles (SUVs) such as Scorpio, Bolero, Xylo and most recently XUV5OO. The automaker sold 353,800 vehicles in 2011 and had market share of 12.1%. The company, which has been a market leader in the utility vehicle (UV) segment, enjoys strong demand especially in the rural areas. M&M ventured into the passenger car segment in 2007 through a joint-venture with Renault. The JV launched Logan, its first passenger car, in the same year. However, in April 2010, the companies decided to part ways with M&M buying Renaults stake in the JV. Besides these four automakers, GM, Ford, Honda, Nissan, Renault, Toyota and Volkswagen have also established a firm foothold in the Indian LV market. Though aggressive in pricing and styling their products, these automakers annual sales for most of them, except GM and Toyota, are still under 100,000 units have yet to gain the kind of
traction which can upset market leaders such as Maruti Suzuki and Hyundai. However these automakers are increasingly launching new cars in the volume-driven small car and entry-level sedan segment, a strategy which is expected to boost their sales volumes in the coming years. Indias premium car market has also shown inspiring growth in the past few years. While Mercedes-Benz has been in India since 1995, others such as Audi and BMW and most recently Jaguar Land Rover (JLR) a brand that Indias Tata Motors acquired from Ford in 2008 are also expanding their operations in the country. BMW has already displaced Mercedes-Benz as the largest selling premium car maker in India and is expected to maintain its leading position in coming years. Figure 8: Audi, BMW and Mercedes-Benz sales in India (2009-2011, 2016, and 2022)
30,000 25,000 In '000 units 20,000 15,000 10,000 5,000 0 2009 2010 Audi BMW 2011 Mercedes-Benz 2016 (f) 2022 (f)
Figures for year ending 31 December; f: forecast; Source: IHS Automotive India is also fast emerging as an attractive market for luxury carmakers such as Aston Martin, Bugatti, Ferrari, Lamborghini and Maserati. Though these companies currently sell a very small number of cars in India mostly as completely built units (CBUs) they are optimstic that the country will play a key role in boosting their global sales in the years ahead. The LV segment is expected to continue recording strong growth in medium to long term. According to IHS Automotive, LV sales in India are expected to cross five million units by 2017 and reach 7.6 million units by 2022. LV production is expected to grow to five million units in 2015 and eight million units by 2022.
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Figure 9: India Light Vehicles Sales Forecast
8,000 7,000 6,000 In 000 units 5,000 4,000 3,000 2,000 1,000 0 2012 2013 2014 2015 2016 Cars 2017 LCVs 2018 2019 2020 2021 2022
Figures for year ending 31 December; Source: IHS Automotive Figure 10: India Light Vehicles Production Forecast
9,000 8,000 7,000 In 000 units 6,000 5,000 4,000 3,000 2,000 1,000 0 2012 2013 2014 2015 2016 Car 2017 LTR 2018 2019 2020 2021 2022
Figures for year ending 31 December; Source: IHS Automotive
Medium and heavy duty commercial vehicle

The demand for medium and heavy commercial vehicles (M&HCVs) has a strong correlation with a countrys economy. In India too, the segment recorded robust demand up
until 2007 but declined sharply in the subsequent two years before registering strong recovery again in 2010. HCVs sales in India increased from 114,100 units in 2002 to 335,700 units in 2011 (see Figure 11). HCV production grew in line with demand, increasing from 118,650 units in 2002 to 364,800 units in 2011. Figure 11: Indian Medium & Heavy Commercial Vehicle Sales and Production (2002-2011)
400 350 300 In '000 units 250 200 150 100 50 0 2002 2003 2004 2005 Sales 2006 2007 2008 2009 2010 2011 Production
Figures for year ending 31 December; Source: IHS Automotive M&HCV segment in India is dominated by local automakers. The top three players in the segment Tata Motors, Ashok Leyland and Eicher together sold 314,300 units in 2011 and had more than 93.5% of the market share. The dominance of Indian players has come about because of two factors. First, the HCV segment received government support before the market was opened for global automakers. Second, unlike the passenger car makers, the global HCV makers took a long time to realise the potential of the Indian market most are now scrambling to snatch a share of the India pie. Tata Motors, the largest player in the segment, sold 198,600 units, or about 59% of all HCVs sold in 2011. Ashok Leland, in second position, sold 80,700 vehicles (24%) followed by Eicher at 34,990 units (10.4%). The M&HCV segment is also expected to grow over the next 10 years. However, unlike the consistent growth projected in the LV segment, the M&HCV segment will have its share of ups and downs. According to IHS Automotive, M&HCV sales are expected to cross the half-million mark in 2015 and 675,000 units in 2022. The production is expected to grow in tandem with demand, albeit at a higher rate, reaching the half-million mark one year earlier than sales in 2014 and expected to touch 738,500 units in 2022.
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Figure 12: Indian Medium & Heavy Commercial Vehicle Sales and Production Forecast (20122022)
800 700 600 In 000 units 500 400 300 200 100 0 2012 2013 2014 2015 2016 Sales 2017 Production 2018 2019 2020 2021 2022
Figures for year ending 31 December; Source: IHS Automotive Rising exports Although the two-wheeler segment rules the export market in terms of volume, passenger vehicles have also witnessed consistent export growth during the past seven years. According to SIAM, in financial year ended 31 March 2011 (FY2011-12), while exports of passenger vehicles recorded a moderate growth of 1.6% to 453,480 units, the commercial vehicles segment reported a year-on-year increase of 69.5% to 76,300 units. Two- and threewheelers also recorded significant growth of 35% to 1.5 million and 55.8% to 267,967 units respectively. In the passenger vehicle segment, Hyundai continues to dominate the exports market, accounting for more than half of all passenger cars exported from the country followed by Maruti Suzuki. In financial year 2011, Hyundai exported 233,069 units, or 51.4% of total passenger vehicle exports from India. Maruti Suzuki exported 138,266 units, or 29.4% of the total passenger vehicle exports, during the financial year.
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Figure 13: Indian Vehicle Exports (2004-2011)

2,500 2,000 In '000 units 1,500 1,000 500 0 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 Two Wheelers Three wheelers Passenger Vehicles Commercial Vehicles
Figures for year ending 31 March; Source: SIAM India is fast emerging as a manufacturing hub for small cars, thanks to the cost advantage the country offers over other markets. Hyundai has been exporting its small cars such as Santro, i10 and i20 from India. Until early 2010 the South Korean automaker produced the i20 hatchback exclusively in India for global markets. In January 2012, Hyundai commenced exports of the Eon compact to South America, ASEAN and South Africa. Maruti Suzuki exports its entry-level vehicle A-Star (sold as Alto in overseas markets) to over 120 countries. A-Stars exports crossed the 200,000 unit mark in just two years in 201011. Ford, too, is climbing the export ladder. The huge success of its Figo hatchback in India has led the company to explore more markets for the small car. In 2011, the company exported 22,521 vehicles. Ford plans to export Figo to 50 countries by 2012 from 32 countries currently. Toyota also commenced exports of its Etios sedan (launched in December 2010) and Etios Liva hatchback (launched in June 2011) to South Africa in the first half of 2012. Besides a low-cost destination there are other factors working in Indias favour. Japan, a manufacturing giant, is gradually losing competitiveness due to rising cost of production and the appreciating yen. This has forced many Japan-based automakers to look at their overseas facilities to meet their export commitments. For example, Nissan has commenced exports of its small car Micra, also known as March, from its overseas plants in Thailand, India and Mexico. The company believes that if India can provide competitive advantage in terms of suppliers and labour costs, the country can emerge as one of the most cost-effective manufacturing locations to meet export demand.
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GROWING COMPETITION IN ALL SEGMENTS

The increasing competition is set to change the pecking order of OEMs in India, especially in passenger vehicles segment. Maruti Suzuki has seen its market share decline from 41.2% to 32% in the past 10 years. However, despite the decline in market share, Maruti Suzuki has recorded strong growth in sales volumes, which exceeded the one million unit mark in 2010 from 330,300 units in 2002. The automaker seems ready for the challenge. Competition is a healthy phenomenon for the market. However I think the Indian customer makes very smart choices considering the entire life-cycle value of the car and the confidence in the brand rather than only advertisements or discounts. Manufacturers will have to provide cars which are engineered just right for the Indian market. Maruti Suzuki continues to have a strong leadership in the market. If we adjust for some supply side issues, there has been no meaningful shift in our market share, so far, said Rahul Bharti, head Corporate Planning and Investor Relations, Maruti-Suzuki. The LCV segment is also expected to heat up with new products from new players. In 2011, Indias heavy commercial vehicle (HCV) major Ashok Leyland entered the LCV segment through a production agreement with Japans Nissan. The automaker launched Dost, a 1.25-tonne pick-up vehicle, which is manufactured at its Hosur plant in Tamil Nadu (India). At the 2012 Auto Expo in New Delhi (India), the JV unveiled a six-tonne truck, Partner, and a minivan, Stile. The JV will commence production of these two models in 2013. Foreign automakers so far have very little presence in Indias LCV segment but that might change. GM is preparing its Halol plant in Gujarat (India) as a manufacturing base for LCVs. The US automaker is relocating passenger car production from the Halol plant to another plant in Talegaon in Maharashtra. Initially, GM plans to launch LCV models that the company currently produces in China along with its local joint-venture partner SAICWuling. The automaker is planning to launch its LCVs in India in 2012. The competition is also intensifying in the M&HCV segment with several global automakers announcing their India entry strategy in the past five years. For example, USbased Navistar International has formed a JV with M&M to produce and sell M&HCVs ranging from 3.5 tonne to 49 tonne trucks in India. The JV, Mahindra Navistar Automotive, has a manufacturing plant in Chakan, near Pune in Maharashtra (India) which started operations in June 2010. The plant has a capacity to produce 50,000 trucks and 45,000 engines annually. In April 2008, Germany-based Daimler, the worlds largest truck maker, formed a JV with local two-wheeler major Hero Group to enter the Indian commercial vehicle market. However, one year later the Indian partner pulled out of the JV citing financial reasons Daimler, which went ahead with the project, is now set to roll out a range of trucks under the BharatBenz brand by the third quarter of 2012. The company showcased trucks at the 12th Auto Expo in New Delhi (India) in January 2012. The German commercial vehicle major has invested IR44bn (USD1.1bn) in an integrated manufacturing plant in Orgadam, near Chennai, Tamil Nadu (India) which is expected to start operations in April 2012. Other notable European companies which have entered Indias commercial vehicle market are MAN and Volvo Trucks. MAN entered India in 2006 through a JV with local
automaker Force Motors. The Indian partner initially had an 80% stake in the JV, MAN Force Trucks, while the remaining 20% was with the German automaker. However, two years later it became a 50:50 JV. In November 2011, Force Motors decided to exit the JV by selling its stake for EUR150m (USD200m). This, however, has not impacted the JVs plans to foray into Indias bus market. The company displayed its MAN Aerobus model at the Auto Expo in New Delhi in 2012. The company expects to sell 250 buses by the end of 2012. In July 2008, Sweden-based Volvo Group, the worlds second largest truck manufacturer, entered a 50:50 JV with Eicher Motors to manufacture commercial vehicles for the Indian market. In 2010, the JV announced investment of INR28bn (USD615m) at Pithampur plant in Madhya Pradesh (India) to commence production and assembly of Volvo Groups new VE Powertrain.
MODERATION IN VEHICLE SALES

After positive growth in two consecutive years, 2009 and 2010, demand weakened in 2011, especially after the second quarter of the year. Several economic factors, such as rising fuel prices, food inflation, impacted the disposable income of Indian consumers. Even the festival seasons during October when many Indians buy new vehicles failed to lift sales. During the month, passenger car sales fell 23.8% to 138,521 units from 181,704 units a year ago. The contraction was not all pervasive though. Segments such as two-wheelers, utility vehicles, vans and light and heavy commercial vehicles reported strong demand from consumers during the month driving the overall growth of the Indian automotive industry. Below are some factors which are affecting sales in the country.
High inflation and interest rates

India has witnessed nearly double-digit inflation in the past three years. The ascent continued even during the global economic slowdown. To rein in prices the Reserve Bank of India (RBI), the central bank of the country, raised key interest rates 13 times between March 2010 and October 2011. As a corollary, banks have raised lending rates, severely impeding auto financing and vehicle demand in India more than 75% of passenger vehicles and 90% of commercial vehicles are purchased through loans. However, though inflation has cooled a bit, successive interest rate hikes have affected investments and weakened economic growth. As a result, the RBI abstained from raising lending rate in its credit policy announced January 2012. Besides, the central bank reduced cash reserve ratio (CRR) by 50 basis points to 5.5%.
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Figure 14: India's Consumer Price Inflation (Jan-09 to Jan-12)

18.00% 16.00% 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00%
Source: OCED Figure 15: India's Central Bank Lending Rates (Jan-09 to Sep-11)
9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00%
Source: OCED
Rising fuel prices

The sharp increase in fuel prices, especially gasoline (petrol), has also hurt vehicle demand in India. In 2010, the Indian government deregulated petrol prices, giving oil marketing companies (OMCs) the freedom to adjust prices according to movements in the global markets. Since deregulation, the retail price of petrol has increased almost 28% to around
INR65.74 (USD1.2) a litre. In comparison, diesel price has jumped around 15.3% to INR40.91 (0.75) a litre during the same period. Figure 16: Indian Petrol and Diesel prices (Mar-10 to Dec-11)
80 70 In Indian rupees 60 50 40 30 20 10 0 May-10 May-11 Dec-10 Mar-10 Mar-11 Aug-11 Dec-11
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Jan-11
Jul-10
Oct-10
Jul-11
Feb-11
Jun-10
Apr-10
Nov-10
Sep-10
Jun-11
Apr-11
Oct-11
Aug-10
Petrol
Diesel
Figures are petrol and diesel prices prevalent in the state of New Delhi; Source: IHS research Meanwhile, the government continues to regulate prices of diesel, compressed natural gas (CNG), and liquefied petroleum gas (LPG), as these fuels have wider applications; and removing the subsidy could have a direct impact on inflation and the countrys economic growth. This has widened the price gap between petrol and other still-regulated fuels, severely distorting the vehicle demand mix in India. Consequently, demand for diesel vehicles has increased at a rate with which many automakers are unable to keep pace. This has led to growing waiting time for diesel vehicles. Besides, OMCs have also increased prices due to a continuing weakening of the Indian rupee against the US dollar which makes imports of crude oil expensive. For a country like India, which meets about three-quarters of its oil requirement through imports, the combined impact of rising global crude oil price and depreciation of the rupee has been severe on vehicle demand.
Frequent strikes
Vehicle sales in India have also been affected by frequent strikes at Maruti Suzuki during the second half of 2011. The automaker, which currently sells nearly half of all passenger cars in the country, faced multiple strikes at its Manesar assembly plants in Haryana (India). The strike was also supported by workers at its component subsidiary, Suzuki Powertrain India Limited (SPIL), which makes engines and transmissions for the automaker. The three major strikes at Maruti Suzuki resulted in production loss of more than 83,000 units in the second half of 2011. The delay in resumption of operations at the Manesar plant, which produces
Sep-11
Nov-11
popular models such as Swift, DZire, Ritz and SX4, resulted in a sharp increase in the waiting period of several models, especially the newly launched Swift for which the company received more than 100,000 orders within months of its launch.
INDUSTRY RESPONSE
The slowdown in sales has forced some automakers to adjust their production to avoid inventory build-up. Tata Motors adjusted production of both passenger and commercial vehicles during the third quarter of 2011. We have adjusted production of both passenger vehicles and commercial vehicles in order to align with the market demand," said P.M. Telang, Tata Motors Managing Director, India Operations, on the sidelines of a SIAM convention held in September 2011. He added that production adjustment varied across different models. "As far as the commercial vehicles are concerned, most of the cut is in the higher segment, as the light and small commercial vehicle segment is doing well," Telang said. Other automakers have also decided to go slow though most of them have not announced any production cuts. Hyundai has a different strategy; it is focusing on exports to counter slowdown in the Indian market. "Our first priority is always the domestic market, but in the last few months it is quite down. So in order to keep our overall sales momentum intact, we are reviewing our focus on export destinations, said Arvind Saxena, Director Marketing, Hyundai Motors India, on the sideline of a SIAM summit held in September 2011. The South Korean automaker exports its vehicles to some 110 countries in Africa, West Asia, Asia-Pacific and Europe. The weakness in demand is expected to also hurt component suppliers. According to ACMA, the Indian component industry is projected to grow at 12-15% in the financial year ended 31 March 12 compared with 33% in 2010-11. Some domestic suppliers are in a spot considering the big investment they made in the past two financial years for capacity expansion to meet surging demand the slowdown has left many with excessive capacity. However, only suppliers with greater exposure to the passenger car segment are bleeding. Suppliers with a balanced product portfolio catering to two-wheelers, three-wheelers, commercial vehicles and off-road vehicles have been less impacted. However, experts believe the current slowdown is cyclical and the market will be back on its feet soon. The current slowdown in the market is part of the cycle, so there is no need to push the panic button. When the global market was slowing down in 2008-09, India withstood the recession to a reasonable extent, said S. Sandilya, President of SIAM to Autocar Professional. This time around, the car segment has taken a beating but the twowheeler segment has not experienced a drop, while the commercial vehicle (CV) sector has done quite well. The performance of the CV segment is a function of GDP growth, as goods and people have to be transported and railways cannot keep pace with the rising demand for movement of goods and passengers. He added, Overall the industry in the medium to long term will be a growing market."
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MEDIUM TO LONG-TERM OUTLOOK REMAINS BRIGHT

IHS Automotive believes the Indian automotive market will continue strong growth in vehicle demand in the medium to long term despite some concern in the immediate term. The strong domestic demand is expected to be complemented by a rise in export volumes as automakers have begun using India as a manufacturing base to meet their overseas vehicle demand. These two factors are expected to drive growth in vehicle production in India in the coming years. On a macroeconomic level, India continues to perform well compared to most developed and developing countries. The country is expected to record high single-digit GDP growth in the medium to long run, driven by continuing robust performance of the service sectors. IHS Automotive expects the countrys growth momentum to return to its historical trend, expanding upward of 8% over the medium term and maintaining healthy growth averaging 6.5% through the long term. The GDP growth should result in higher per capita income for Indians this bodes well for automotive demand. According to a report by the National Council for Applied Economic Research's (NCAER) Centre for Macro Consumer Research, the middle class population in India is expected to increase by 267 million by 2015-16 compared with 160 million in 2010-11. Figure 17: BRIC GDP Forecast (2008-2014)
15 10 5 In % 0 2008 -5 -10 Brazil Russia India China 2009 2010 2011 2012 (F) 2013 (F) 2014 (F)
India follows the April-March financial year period; Source: IHS Automotive
Vehicle density remains abysmally low in India

According to IHS Automotive, India has one of the lowest car densities in the world around seven cars per 1,000 people. Even developing countries such as Malaysia (253), South Korea (219), Brazil (96) and China (40) have higher car density. The low car density offers huge growth potential for the automotive industry.
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Figure 18: India has one of the lowest car densities in the world
600 500 400 300 200 100 0 Brazil China Germany India Japan Russia USA 2008 2009 2010
Source: IHS Automotive In addition, rapid urbanisation is expected to further push vehicle demand in the country. According to an estimate, Indias urban population is expected to double to 600 million in 2030 from 380 million in 2011. Urban centres such as the National Capital Region (NCR), Mumbai-Pune, Bangalore-Mysore, and Hyderabad-Secunderabad are witnessing rapid urbanisation owing to a large influx of people from small towns in search of employment. Expansion of public transport in these centres is not keeping pace with growth; hence people are expected to rely on personal transport for their daily commutes.
VEHICLE SALES AND PRODUCTION FORECAST

India is expected to record strong growth in vehicle production and sales over the next 10 years. According to IHS Automotive, total vehicle sales in India are expected to increase from 3.25 million units in 2011 to over five million units by 2015 and to reach 8.3 million by 2022. While LV sales are expected to grow from 2.91 million units in 2011 to 7.61 million in 2022, the M&HCV segment is seen at 674,700 units compared with 335,700 units in 2011. Vehicle production is expected to grow from nearly four million units in 2011 to 8.76 million by 2022. LV production is expected to increase from 3.57 million in 2011 to five million units in 2015, and eight million units by 2022. The M&HCV segment is also expected to almost double production from 364,800 vehicles in 2011 to 738,500 units in 2022.
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Figure 19: Vehicle Sales and Production Forecast in India (2012-2022)

10,000 9,000 8,000 7,000 In '000 units 6,000 5,000 4,000 3,000 2,000 1,000 0 2012 2013 2014 2015 2016 Sales 2016 2017 2018 2019 2020 2021 2022 Production
Figures for year ending 31 December; Source: IHS Automotive Indias emergence as a frugal manufacturing base will also boost production numbers in the years ahead. Over the past few years, automakers have started using India as a small-car manufacturing base to meet demand in Europe, Latin America, Africa, the Middle East, and the ASEAN (Association of South-East Asian Nations) markets. This strategy was initially used by Suzuki and Hyundai, but now automakers such as Ford, Nissan and Toyota have also jumped on the bandwagon. IHS Automotive expects exports to be a major part of the future strategy of Suzuki, Hyundai, Ford, PSA, Volkswagen and Renault-Nissan. Besides, home-grown Tata Motors and M&M are also betting big on exports markets, especially ASEAN markets and the Middle East, to drive their growth.
India continues to attract new players

In the past five years, India has witnessed the arrival of Volkswagen, Renault and Nissan, among others. Encouraging customer response for their products is prompting some to change their India strategy. French automaker Renault, which entered India through a JV with M&M in 2007, finally exited the alliance in 2010 and decided to go solo. The company has commenced assembly operations at a plant in Chennai, Tamil Nadu (India), jointly operated with its global alliance partner Nissan. Renault has decided to launch five new models in India by end-2012, of which three Fluence, Koleos and Pulse have already hit Indian roads. The company showcased its fourth model Duster, a SUV, at the 2012 Auto Expo. Frances PSA Peugeot Citron re-entered India in 2011 after a 10-year gap. Earlier, the French automaker was present in India through a JV with Premier Auto which ended in 2001. In its second coming, PSA decided to set up a greenfield plant in Sanand, Gujarat (India) to initially sell Peugeot brand vehicles in India. We view India as one of the most
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important and dynamic markets in the world, with forecasts of it becoming the third largest automotive market by 2020, Philippe Varin, Chairman of Managing Board at PSA, said at a recent media conference. The automaker is investing INR40bn (USD804m) in a manufacturing plant in India which will have initial production capacity of 165,000 units. The capacity could be later expanded to 340,000 units in phases. The premium segment is also abuzz with the entry of Aston Martin, Bugatti, Ferrari, Jaguar-Land Rover (JLR) and Maserati in the past two years. Although these brands currently sell in small numbers mostly as completely-built units (CBUs) the companies are set to expand their footprint in the country.
Investment plans of automakers

Year 2010 was the best year for the Indian automotive industry all segments reported strong growth. Most automakers operated at their highest capacity levels and some even stretched their production to meet surging demand. As a result, several automakers have announced plans to increase capacity either through new plants or expanding existing facilities. Maruti Suzuki announced two major capacity expansion projects during the year. In February 2010, the company announced plans to invest INR17bn (USD377.5m) in a new plant in its Manesar manufacturing complex. The plant will have an annual capacity of 250,000 units when it becomes operational by the first half of 2012. And in September 2010, the automaker announced it would invest JPY35bn (USD377.6m) in another plant at its Manesar facility which will have annual production capacity of 250,000 units. This plant is expected to become operational by March 2013. In July 2010, Tata Motors also announced plans to invest INR100bn (USD2.1bn) in product development, facility upgrades and other capital expenditure requirements over the next three years. However, business environment changed in 2011, especially after the second quarter. After two consecutive years of strong growth the Indian automotive market, especially the passenger car segment, is now going through a rough patch. However, automakers consider it to be a temporary aberration. Many are investing in building additional capacities either through greenfield projects or expanding existing capacities, or both, to capitalise on the next phase of growth. Leading from the front is Maruti Suzuki, who has announced ambitious plans to set up a manufacturing plant in Mehsana, Gujarat that will eventually have annual capacity to produce two million vehicles in two phases. The automaker, along with its supplier base, is planning to invest INR180bn (USD4bn) in the projects over the next 10 years. US automaker Ford is setting up its second integrated manufacturing plant in Sanand, Gujarat, with an investment of USD1bn. The plant will have an annual capacity of 240,000 units and 270,000 engines, when it commences operations in 2014. The Sanand facility will enable Ford to more than double production capacity in India to 400,000 units. M&M is investing INR18bn (USD393m) to set up a new manufacturing plant and testing centre in Chennai, Tamil Nadu.
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Some automakers are ramping up their existing facilities. GM is investing INR6bn (USD133m) at its Talegaon plant in Maharashtra to double capacity to 280,000 cars and 320,000 engines. The company is relocating passenger car and utility vehicle production from its Halol plant in Gujarat to Talegaon in Maharashtra. The automaker intends to develop the Talegaon plant as a hub for passenger car production while the Halol plant will focus on production of light commercial vehicles, a new business segment GM is planning to enter. The automaker is investing USD250m to ramp up its Halol plant to increase capacity from 85,000 units to 100,000 units. Toyota Kirloskar Motor, the local unit of Toyota, is investing INR8.9bn (USD198m) to ramp up capacity by 100,000 units at its second plant in Bidadi, Karnataka, which started operations in 2010. Hyundai is ramping up capacity at its plants in Chennai, Tamil Nadu, without making any substantial investment. The South Korean automaker is increasing capacity from 630,000 units to 670,000 units. Table 1: Investment plans in India
Automakers Ashok Leyland Investment details September 2011: Ashok Leyland has announced it would invest INR23bn (USD462.4m) in two phases over the next three years. The company will invest INR11bn (USD221.1m) to INR12bn (USD241.3m) in the first phase. Ashok Leyland will primarily invest in new business of light commercial vehicle (LCVs) for which it has partnered with Nissan. The two partners has already launched new product in the segment called Dost February 2012: Daimlers car business unit Mercedes-Benz announced it would invest INR3.5bn (USD70.2m) in India to set up two new car production lines at its plant near Pune, Maharashtra. The plant already has two assembly lines, one for cars and another for commercial vehicles. The automaker plans local assembly of four to five models at the plant to avoid high domestic import duties on fully built cars. August 2011: Force Motors announced plans to invest INR10bn (USD216.8m) over the next two years to increase its manufacturing presence and launch at least two new vehicles, including Force One which was introduced one month later. The company is evaluating the possibilities of setting its new plant at Pithampur in Madhya Pradesh where it operates two plants. The new plant will have initial production capacity of 12,000 units a year, which could be ramped to 24,000 units. January 2012: Ford India announced plans to invest INR7.5bn (USD148.5m) at its Chennai plant in Tamil Nadu to produce EcoSport, a sport utility vehicle (SUV) unveiled at the 2012 Auto Expo at New Delhi. July 2011: Ford announced that it would invest USD1bn in its second plant in India in Sanand, Gujarat. The plant will have an initial production capacity to produce 240,000 vehicles and 270,000 engines a year when it becomes operational in 2014. May 2011: Ford announced that it would invest USD72m at its powertrain facility near its assembly plant in Chennai, Tamil Nadu. The investment is expected to ramp up the companys diesel engine production capacity in India from 250,000 units to 330,000 units by mid-2012.
Daimler
Force Motors
Ford
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GM
July 2011: GM announced an investment of INR6bn (USD133m) at its Talegaon car and engine manufacturing plant in Maharashtra The investment is expected to double the capacity at the plant to 280,000 cars and 320,000 engines a year. September 2011: Mahindra & Mahindra announced an investment of INR18bn (USD393m) in a new vehicle manufacturing plant and testing facility in Cheyyar, about 100km away from Chennai, Tamil Nadu. The plant will initially be a single line facility which will manufacture only one product. January 2012: Maruti Suzuki has announced plans to set up a diesel plant in Gurgaon, Haryana. The company has disclosed neither capacity nor amount of investment planned at the plant which is expected to become operational by the second half of financial year 2013. October 2011 Maruti Suzuki announced that it would invest, along with its vendors, INR180bn (USD4bn) in a new manufacturing plant and vendor park in Mehsana, Gujarat. The company will invest INR120bn (USD2.64bn) in two phases while its vendors will make a combined investment of INR60bn (USD1.31bn). The proposed investment is expected to raise the company's production capacity to two million units. September 2010 Maruti Suzuki announced that it would invest JPY35bn (USD377.6m) to set up a third production plant at its Manesar complex in Haryana (India). The plant will have an annual production capacity of 250,000 units and is expected to become operational by financial year 2012-13. February 2010: Maruti Suzuki announced an investment of INR17bn (USD377.5m) in a new plant at its Manesar complex in Haryana. The plant, expected to become operational by the end of financial year 2012, will have an annual production capacity of 250,000 units. August 2011: PSA Peugeot Citron announced that it would invest INR40bn (USD804m) in an integrated manufacturing plant in Sanand, Gujarat. The plant will have an initial production capacity of 165,000 units a year which could be expanded to 340,000 units in phases. July 2010, Tata announced an investment of around INR100bn (USD2.1bn) in product development, facility upgrades, and other capital expenditure requirements over the next three years. July 2011: Toyota announced an investment of INR16.5bn (USD368m) in its Indian operations. Toyota Kirloskar Motor will invest INR8.9bn (USD198.4m) to ramp up capacity by 100,000 units while its auto parts subsidiary Toyota Kirloskar Auto Parts will pump in INR7.5bn (USD167.2m) to set up an aluminum casting and machining line by 2014. February 2012: Volvo Eicher Commercial Vehicle (VECV) announced it would invest INR1.25bn (USD25.3m) to set up its first bus body manufacturing plant in Dhar, near Indore in Madhya Pradesh. The plant will be equally owned by VECVs partners Volvo and Eicher. The plant will have capacity to make 10,000 bus bodies a year when it commences operations in mid-2013.
Mahindra & Mahindra
Maruti Suzuki
PSA Peugeot Citron
Tata Motors
Toyota Kirloskar Motor
Volvo Eicher Commercial Vehicle
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The phenomenal growth of the Indian auto industry would not have been possible without a strong and efficient supply base. The Indian auto supplier industry has also evolved over the period in line with the vehicle industry. The next chapter offers an overview of how the local supplier industry has evolved in the past 30 years. The chapter also analyses the changing supplier-OEM relationship in light of growing competition. The next chapter also looks at the emergence of automotive clusters in India which play a vital role in attracting foreign investment into the country.
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INDIAS AUTOMOTIVE COMPONENT INDUSTRY

Indias auto components industry recorded strong growth for most of the past decade except for during the global financial crisis of 2008-09 total turnover of suppliers in that financial year fell by USD3.5bn to USD23bn compared to the previous fiscal year. The industry, however, was back on its feet in the following two financial years recording growth of 30.1% and 34.2% respectively. The decade also saw Indias emergence as a major component sourcing destination with several global automakers and suppliers setting up their International Purchasing Offices in the country. But, for the time being the industry continues to thrive on domestic demands currently about 85% of total revenues is generated in the domestic market. This explains why the global economic slowdown has had a relatively lesser impact on Indian suppliers.
STRONG GROWTH AFTER GLOBAL SLOWDOWN

Demand for vehicles (including two- and three-wheelers) grew 26.4% year on year (y/y) to 12.3 million units, and 26.2% to 15.5 million units in financial year (FY) 2009-10 and FY2010-11 respectively. Production, too, moved into the fast lane, increasing 25.8% to 14 million units in FY2009-10 and 27.4% to 17.9 million units in 2010-11. As a result, the local supplier industrys revenues also grew 28.4% y/y to INR1.4trn (USD30.1bn) in FY2009-10 and 34% to INR1.8trn (USD40.1bn) in 2010-11, according to ACMA. Figure 20: Turnover of India's automotive parts industry
45 40 35 USD billion 30 25 20 15 10 5 0 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 22.9 18.9 26.5 23 30.1 39.9
Figures for financial year ended 31 March; Source: ACMA Suppliers in India manufacture almost all kinds of components for vehicles. According to ACMA, nearly 31% of the components manufactured in India are engine parts, 19% are transmission & steering parts, body & chassis and suspension & braking components account for 12% each, 10% of the products are machines and equipment that are used in the production of components, 9% are electrical parts, and other components account for the remaining 7%.
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Figure 21: Components Manufactured in India by use in Vehicle
7% 9% 31% 10% Engine Parts Drive Transmission & Steering Parts Body & Chassis Suspension & Braking Parts 12% 12% 19% Equipments Electrical Parts Others
Figures for financial year ended 31 March 2011; Source: ACMA The Indian supplier industry has also benefited from the recovery in vehicle demand in major international markets such as North America, western Europe and Asia. Auto parts exports from India grew an impressive 54% y/y to USD5.2bn during FY2010-11, after falling 15.5% y/y in the previous year. In the past five financial years (2006-07 to 2010-11), the Indian supplier industry has grown at a CAGR of 14%. Of the total exports from India, four-fifths go to OEMs or tier one suppliers while the remaining one-fifth is for the aftermarket. During FY2010-11, key auto components exported from India included engine parts, transmission parts, brake systems, body parts, exhaust system and turbochargers. Europe continues to be the biggest export market for the suppliers in India, but its share in total exports declined from 40% in FY2009-10 to 36% in FY2010-11. This was despite exports to the region recording an impressive 46% growth over the previous financial year. However, this decline was offset by increased exports to Asia the region accounted for 28% of total exports in FY2010-11 compared with 24% a year ago led by a 48% y/y jump in exports over 2009-10. At 65%, parts exports to North America saw the sharpest increase, but the regions shares in total exports remained flat at 23% compared with the previous year. Further, exports to South America increased just 1% y/y to 5%, while those to Africa declined from 8% to 7% during the comparable period. In the past five financial years (200607 to 2010-11), Indias auto parts exports have increased at a CAGR of 14% to USD5.2bn, ACMAs data show.
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Figure 22: Indias Auto Component Export Destinations Percent Share (FY2010-2011)
1% 7% 5% 36% Europe North America Asia 28% South America Africa Australia 23%
Figures for financial year ended 31 March 2011; Source: ACMA Figure 23: Indias Auto Component Export Destinations Percent Share (FY2009-2010)
1% 8% 4% 40% 24% Europe North America Asia South America Africa Australia 23%
Figures for financial year ended 31 March 2010; Source: ACMA Source: ACMA Export figures are encouraging but imports of auto components grew at a higher CAGR of 23.1% from USD3.9bn in FY2006-07 to USD8.5bn in FY2010-11. Imports in FY2010-11 increased 30.2% y/y after declining by 4.2% a year ago. Key auto components that India imported in FY 2010-11 included engine parts, transmissions, steering, exhaust systems and turbochargers. Asia remained the largest import market for automakers and suppliers operating in India, accounting for 56.3% of total imports in FY2010-11. Imports from the region grew 29% y/y compared with the previous fiscal year (see Figure 24). Although
imports from Europe increased 34% during 2010-11, the share of the region in total imports slipped marginally from 36% to 35.3%. North America was the third biggest import market during the financial year accounting for 7.1% of total imports; its share however declined from 8.3% in FY2009-10, despite import volumes recording a 24% growth. Other import markets including Africa, Australia and South America accounted for less than 1% of total imports in FY2010-11. Figure 24: Indias Auto Component Import Location Percent Share (FY2010-2011)
0.6% 0.5% 0.2%
7.1% Asia Europe 35.3% 56.3% North America South America Africa Australia
Figures for financial year ended 31 March 2011; Source: ACMA Figure 25: Indias Auto Component Import Location Percent Share (FY2009-2010)
0.2% 0.2% Asia Europe North America South America 36.0% 54.4% Africa Australia
0.9%
8.3%
Figures for financial year ended 31 March 2010; Source: ACMA

In FY2010-11, automakers accounted for 85% of total component imports while aftermarket suppliers imported the remaining 15%. Auto parts imports have surged in the past few years; this is happening because many foreign automakers continue to import parts for vehicles they manufacture in India but develop outside the country. Many foreign automakers find it feasible to import components from international markets until they reach a critical mass to justify local production. But this trend is changing, as foreign automakers scramble to increase localisation of their vehicles by collaborating with Indian suppliers. For example, Volkswagen has started sourcing suspension systems from local supplier Gabriel India. We would be starting our supplies to Volkswagen. We have been at it (developing the product) for more than two years and now it's ready, said Arvind Walia, managing director of Gabriel India, in a media interview. Talking about the collaboration with the OEM, Walia said, We start working and developing the products when they start planning for the model. It is longish exercise, which takes about two years plus to develop a product, which suits a particular application. Besides, the many international trade agreements that India has over the years, have made imports more attractive for automakers in India Toyota, Honda and Suzuki are importing from ASEAN countries for their operations in India. This has caused imports to bulge against exports. Further, Indian suppliers rely heavily on the domestic market for their growth and their focus on exports is still very little. The gap has widened in the past six years. The trade deficit has increased from less than USD1bn in 2006-07 to USD3.3bn in 2010-11. This deficit is expected to remain quite big in the near future as foreign automakers launch new models more frequently in order to stay competitive. Figure 26: Indian export and import value in USD (2005-2011)
9 8 7 6 5 4 3 2 1 0 2005-06 2006-07 2007-08 Years Exports Imports 2008-09 2009-10 2010-11 8.5 6.2 3.9 3.1 3.8 6.8 6.5 5.2 4 3 2.7 3.4
Figures for financial year ended 31 March; Source: ACMA
USD billion
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GROWTH MODERATION IN 2011-12

After two years of strong growth, the Indian automotive industry is currently witnessing a slowdown. Vehicle sales growth in India fell moderately during the first 11 months of FY2011-12 owing to several factors, including rising fuel prices, high inflation and interest rates. This has led SIAM to lower its growth projection for FY2011-12 first in July and then in October 2011 and more recently in January 2012. According to its latest forecast, SIAM is expecting passenger cars sales in India to grow at 0-2%, two-wheelers at 13-15% and commercial vehicles at 18-20% in the current fiscal year. The October forecast itself was a downgrade from an earlier projection of 1012% growth made in July, and a 1618% growth announced in April. Sugato Sen, Senior Director of SIAM has been quoted as saying, If we do well in the next three months, we'll break evenIf we do extraordinarily well, it could go up to 2%. Overall, the association is expecting an 11-13% increase in vehicle sales during 2011-12 compared with 26.2% realised in the previous financial year. ACMA is also projecting y/y growth of 12-15% in FY 2011-12 compared with 34.1% recorded in the previous financial year. However, a closer look at the demand pattern in India during the first 11 months of FY2011-12 reveals that it is only three-wheeler segments which continue to witness a negative growth in sales. The passenger car segment, which had reported negative growth up until the third quarter of the financial year ended 31 December 2011, recorded significant recovery in the first two months of the fourth quarter and ended year-to-date (YTD) growth on a positive note. Other segments have recorded reasonable growth, though not as impressive as in the previous two financial years. According to SIAM, vehicle sales in India in the first eleven months ended 29 February 2012 grew at 12.5% to 15.8 million. Of this total, passenger vehicle sales increased by 2.9% to 2.32 million. In the passenger vehicle segment, passenger cars sales registered a 0.3% growth to 1.79 million, while utility vehicles (UVs) and vans registered growth of 14.7% and 10.1% to 326,824 units and 212,881 units respectively. The commercial vehicle segment grew a healthy 18.6% to 719,117 units. The two-wheeler segment recorded 14.8% growth in sales to 12.3 million units while threewheelers witnessed a marginal decline of 1.8% to 470,975units.
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Figure 27: Two-wheelers and commercial vehicles continue to drive industry growth , passenger vehicles segment recorded impressive recovery
14,000 12,000 10,000 In '000 units 8,000 6,000 4,000 2,000 0 Two wheelers Three wheelers 2009-10 2010-11 Passenger vehicles 2011-12* Commercial vehicles
Figures for financial year ended 31 March, *Figures for 11 months ended 29 February 2011; Source: SIAM Most Indian suppliers have a diverse customer base, supplying to two-wheelers, threewheelers, passenger cars, light commercial vehicles (LCVs), heavy commercial vehicles (HCVs), and off-the road (OTR) vehicles. Besides, a majority of domestic suppliers has presence in the aftermarket and generate revenue through exports. Therefore, a decline in vehicle demand in one particular segment does not impact them badly. However, suppliers who have more exposure to the passenger car segment, have felt the heat lately. Industry experts see the current moderation as an aberration and reckon that the Indian automotive market is well-positioned for the next growth phase. According to ACMA Vision 2020, turnover of the Indian auto component industry is expected to grow to more than INR5trn (USD110bn) in 2020 compared with INR1.8trn (USD39bn) in 2010-11. Of this, the domestic market is expected to account for nearly INR4trn (USD80bn), or 80% of the total turnover, while exports are projected to zoom to INR1.4trn (USD29bn). The vision is based on the assumption that passenger vehicle production in India will reach five million units by financial year 2015 and nine million by 2020, compared with three million units in 2010-11. The commercial vehicle production is expected to touch 1.4 million units by 2015 and 2.2 million units by 2020 over 752,723 units in 2010-11. Other segments such as twowheelers, three-wheelers, tractors and OTR are also expected to record promising growth. ACMA says that strong growth will increase the share of Indias component industry in the countrys GDP to 3.6% in 2020 compared with 2.1% at present. However, in order to achieve this goal the Indian auto industry will be required to invest INR1.6trn (USD35bn) in new capacity. The industry will also require an additional skilled workforce of one million.
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IHS Automotive forecasts production of light vehicle powertrain components (engines and transmissions) to grow in line with the growth in vehicle production in India. The production of light vehicle engines and transmission is expected to more than double in the next 10 years compared with 2011 (see Figure 28). While production of light vehicle engines is expected to increase from 3.23 million units in 2011 to 7.63 million units in 2022, transmissions output is expected to reach 7.14 million units in 2022 compared with 3.39 million units in 2011. This reflects the growing trend among automakers in India to focus more on localisation. Figure 28: Production of Light Vehicle Engines and Transmissions in India
9,000 8,000 7,000 In 000 units 6,000 5,000 4,000 3,000 2,000 1,000 0 2011 2012 2013 2014 2015 Engine 2016 2017 2018 2019 2020 2021 2022 Tranmission
Figures for financial year ended 31 December; Source: IHS Automotive
INDIAN SUPPLIER INDUSTRY CONTINUES TO ATTRACT INVESTMENT

Suppliers in India are sanguine about medium to long term growth and are hence lining up big investments for capacity expansion. In FY2010-11, automakers like Maruti Suzuki faced production constraint due to inadequate supply of components. These automakers asked their suppliers to invest in additional capacities to meet any surge in demand. According to ACMA, the auto component industry invested USD2bn-USD2.25bn in expansion in FY2010-11 and is expected to add a similar amount in FY2011-12. Though many are going ahead with their plans, some are holding back citing the slowdown in vehicle demand fearing they might end up with idle capacity. Minda Industries, which makes switches and panel controls for Maruti Suzuki, Ford and GM, has decided to halve its capital expenditure to INR400m (USD8m) for FY2011-12. The growth is not as good as it used to be. It's better to wait and watch," said N.K. Minda, Chairman of Minda Industries, on the sidelines of an annual conference organised by ACMA in September 2011. Another local supplier Subros, which supplies thermal system components, has announced it put its INR800m (USD16m) capacity expansion plans on hold for three to four months due to the slowdown. The company was planning to ramp up its automotive air-conditioning capacity to two
million units from 1.5 million units. The auto sector has seen demand slow down. Thats why there is no point in having idle capacity, said Ramesh Suri, Chairman of the company during the same annual conference. And its not just fluctuating demand thats hurting investor sentiment. A sharp increase in cost of funds is also forcing suppliers to go slow with expansion. Double-digit inflation in the past couple of years has forced the countrys central bank to frequently increase lending rates. Generally, the automotive supplier industry carries a high risk profile and thus attracts high interest rates. But the scenario has improved somewhat lately. Indias wholesale price index (WPI) showed an inflation rate of 7.47% in December 2011, the lowest in the two years the rate was hovering over 9% in the previous month. As a result, the central bank left repo rate untouched at 8.5% in its January 2012 credit policy. In addition, the RBI cut the cash reserve ratio (CRR) by 50 basis points to 5.5% to improve liquidity. This was followed by another cut of 75 basis points in CRR in March 2012 to 4.75%. RBI has also hinted at cutting rates to encourage investment and bolster growth. Indian suppliers believe that investment could record strong recovery if interest rate comes down. Figure 29: Indian Supplier Investments in USD (2005-2011)
2.5 2-2.5 2 1.5 1 0.5 0.1 0 2005-06 2007-07 2007-08 2008-09 2009-10 2010-11 1 0.7 1.8 1.7
Figures for financial year ending 31 March; Source: ACMA In FY2008-09, investments nosedived when suppliers order intakes declined sharply as a consequence of a fall in vehicle sales globally. But a swift recovery in demand in FY2009-10 put suppliers in India back on capacity expansion mode. Investments reached a new high in FY2010-11. Overall, the domestic supplier industry witnessed a cumulative investment of USD6.5bn in the past five years. Meanwhile, Indian suppliers kept exploring opportunities to enter into strategic alliances, generally with foreign suppliers, to access new technologies or foray into new areas. Some suppliers announced major acquisitions in the past few years which gave them access to already built-up capacity and customer base of the acquired
USD billion
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companies. One such deal during 2011 was Samvardhana Motherson Groups acquisition of 80% stake in European plastic supplier Peguform. Global market leader Bosch is one supplier who has been investing in India for more than a decade. In January 2012, the company disclosed plans to invest INR30bn (USD570m) in the country over the next three years to expand its operations and technologies. Most of this fund will be used in ramping up capacities at its manufacturing plants in the country. In early 2012, many global suppliers announced plans to invest in India. Continental announced it will invest INR8bn (USD148.2m) over a period of two years to ramp up its automotive electronics and enhance its R&D capabilities. The German supplier will also invest EUR50m (USD63.5m) to enter the radial tyre segment. Further, Continentals majority shareholder Schaeffler announced plans to invest EUR150m (USD191m) in India over the next three years to set up a manufacturing facility and expand capacity at its three existing facilities in the country. The local suppliers are also investing in capacity expansions. Lumax Industries is investing INR1.5bn (USD32.5m) to set up three new facilities in India and expand the capacity of its existing units by next year. The investment will result in an additional production capacity of 2.5 million of automotive lighting components the company currently has a production capacity of four million units. Jamna Auto has also announced an investment of INR800m (USD17.6m) to set up two new plants, one each at Hosur and Chennai, both in Tamil Nadu, to manufacture parts for commercial vehicles. In addition, automakers are also investing to manufacture or assemble vital components such as engines. Toyota Kirloskar is investing INR5bn (USD10.8m) to set up a powertrain plant near its vehicle assembly plant in Bidadi, Karnataka. The plant will manufacture 100,000 engines annually from the third quarter of 2012 and 240,000 transmissions from 2013. Ford has announced it would invest USD72m to expand its engine plant in Chennai, Tamil Nadu. The investment will enable the company ramp up its production capacity at the plant from the 250,000 engines at present to 330,000 petrol and diesel engines by mid2012. Among the Indian automakers, commercial vehicle major Ashok Leyland is investing INR4bn (USD88m) in its Neptune series engine platform. Below is a snapshot of some recent investment announcements
INVESTMENTS
Company JK Tyres Remarks February 2012: JK Tyres commissioned its new trye manufacturing plant in Sriperumbudur, near Chennai, in Tamil Nadu. The new plant JK Tyres sixth in India will manufacture radial tyres for passenger cars, buses and trucks. The company invested INR9.7bn (USD196.6m) in the new tyre plant which has an annual capacity to produce 2.5 million passenger cars radials and 400,000 bus and truck radials tyres. The new plant has increased the company production capacity to 7.5 million passenger car radial tyres and 1.4 million bus and truck radial tyres.
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Company LANXESS
Remarks February 2012: LANXESS started three new production facilities in Jhagadia region in Gujarat. The company invested EUR70m to set up these three plants. One of the three facilities focuses on production of high-tech plastics for the automotive industry. The plant, part of the companys Semi-Crystalline products business unit, will supply plastics for automakers such as Ford, Tata Motors and Volkswagen. Also, the companys subsidiary Rhein Chemie has started a new plant to manufacture release agents and additives which are used in production of tyres and other rubber products. The companys third plant focuses on production of biocides for the construction industry. January 2012: Minda announced plans to invest USD50m in capacity expansion in India over the next five years. The company will make this investment to add capacity at its existing plant in Pune, Maharahtra and set up two greenfield plants, one in Chennai, Tamil Nadu and another in Sanand, Gujarat. January 2012: Bosch announced to invest INR30bn (USD570m) in India over the next three years to expand its operations and technologies. Most of this fund will be used in ramping up capacities at its manufacturing plants. Bosch will also invest INR1.4bn (USD25.9m) to support research initiatives in the country for next ten years. January 2012: Continental disclosed plans to invest INR8bn (USD148.2m) in India over a period of two years. The company will invest INR5bn (USD92.6m) to ramp up its automotive electronics and enhance its R&D capabilities. The German supplier will also invest EUR50m (USD63.5m) to enter the radial tyre segment. Continental will launch radial tyres for both passenger cars and commercial vehicles from its Modipuram plant in Uttar Pradesh in India, which it acquired from Modi Rubber in 2011. January 2012: Schaeffler announced plans to invest EUR150m (USD191m) in India over next three years. The company will use the funding to set up a manufacturing facility and expand capacity at its three existing facilities located in Vadodara, Gujarat; Pune, Maharashtra and Hosure, Tamil Nadu. January 2012: Denso is planning to invest INR3bn (USD56.6m) to set up a new production facility at Gurgaon, Haryana. The company will be manufacturing air-conditioning components like heat exchangers and various kinds of motors in the new plant. Denso has acquired a 150,000m2 site for the plant and production is expected to start at the end of 2013. December 2011: Cosma, a unit of Magna, announced an investment of INR3bn (USD55.3m) to set up a plant in Talegaon, Maharashtra to produce body and chassis solutions for automakers operating in the region. The plant will become operational in one year. December 2011: National Engineering Industries (NEI) plans to invest INR5bn (USD96.5m) over the next five years. The company will invest in ramping up production capacity at its existing plants and set up a new plant in India. The company has not yet decided upon the location of the new plant, however, it has hinted that the new facility will either be in Karnataka or in Gujarat, both in India. November 2011: GKN Driveline has opened a new forging facility at Oragadam near Chennai, Tamil Nadu. The facility invested INR480m (USD9.2m) and will manufacture precision forgings to the company constant-velocity joint (CVJ) plant in the same location.
Minda Corporation
Robert Bosch
Continental
Schaeffler
Denso
Cosma International National Engineering Industries
GKN Driveline
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Company TI Automotive
Remarks October 2011: TI Automotive announced it was setting up two manufacturing plant in India located in Bangalore, Karnataka and Chennai, Tamil Nadu. The Bangalore facility became operational in December 2011 and produces fluid carrying lines. The Chennai facility will produce plastic fuel tanks and is expected to become operational in April 2012. Both plants are expected to cater to the automakers operating in India. October 2011: Fischer-Brodbeck or FIBRO set up a manufacturing plant in Chakan, near Pune, Maharashtra to produce sheet metal components. The company invested EUR1.5m (USD2.1m) in the new facility which will make components for Gestamp Automacion which is a major supplier to Volkswagen. September 2011: SMI Amtek Crankshaft, a joint-venture between Amtek and Sumitomot Metal Industries and Sumitomo Corporation announced it would invest INR1bn (USD20.1m) to install a second forging line at its manufacturing plant in Dharuhera, Gurgaon, Haryana. The expansion will ramp up SMI Amteks capacity from 800,000 units to 2.2 million units. The new press line is expected to become operational in November 2012. September 2011: Federal-Mogul announced plans to invest USD15m in a new brake friction manufacturing facility in Chennai, Tamil Nadu. The new plant will manufacture brake friction materials for its customers in original equipment (OE) and aftermarket. The plant became operational in 2011-end. September 2011: WABCO Holdings announced to invest INR600m (USD12.3m) in its Indian operations during the current fiscal year 2011-12. The company will invest INR400m (USD8.1m) to expand its facility at Mahindra World City special economic zone (SEZ) in Chennai, Tamil Nadu and another INR100m (USD2m) for setting up a facility at Lucknow, Uttar Pradesh. The company will utilise the remaining amount for other purposes. September 2011: Tenneco's Indian subsidiary, Tenneco RC India will invest USD20m to expand its market reach in the country over the next three to five years. The company has decided to invest keeping in mind the government of India's willingness to introduce stringent emission regulations. The company is in talks with several commercial vehicle manufacturers to supply emissions control products. September 2011: Aisin Seiki disclosed plans to establish two manufacturing plants in India at a total investment of INR7.36bn (USD159.3m). The company will invest INR4.06bn (USD87.9m) in a manufacturing plant, spread over 30 acres at Industrial Model Township (IMT) in Rohtak, to manufacture auto components. In addition, the company will invest INR3.36bn (USD72.7m) in another manufacturing plant in Bangalore, Karnataka to produce brake pads. September 2011: Lumax Industries will invest INR1.5bn (USD32.5m) to set up three new facilities in India and expand the capacity of its existing units by next year. The investment would add another 2.5m units of capacity to Lumax's existing annual production capacity of four million units. The company is setting up the new plants in the Indian states of Haryana, Karnataka and Gujarat, and will also expand its existing facility in Maharashtra by the end of this year. September 2011: Sona Koyo Steering Systems plans to invest INR1bn (USD21.6m) in FY2011-12 to expand production capabilities. The company's expansion plans include setting up a new production facility in Dharuhera, Haryana for supplies to commercial
Fischer-Brodbeck
SMI Amtek
Federal-Mogul
WABCO
Tenneco
Aisin Seiki
Lumax Industries
Sona Koyo
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Company
Remarks vehicle segment, along with investment in existing plants. The new plant became operational at the end of 2011.
Cummins
August 2011: Cummins is setting up a global research and development (R&D) centre in Pune, Maharashtra (India), investing INR3.37bn (USD75.2m). The company already has a similar centre in China, but the Indian facility will be bigger and accommodate over 2,500 engineers. Additionally, the company establishes 10 factories in Maharashtra over the next five years. August 2011: JBM Auto announced to invest INR2bn (USD43.5m) in capacity expansion during financial year 2011-12. The company will invest in ramping up capacity at its existing facilities in Chennai, Tamil Nadu; Pune, Maharashtra and Sanand, Gujarat, to meet increasing orders from automakers including Nissan, Mahindra & Mahindra and Tata Motors. The company has already invested about INR350m (USD7.6m) of planned INR500m (USD10.9m) at its Chennai plant. August 2011: Continental will invest in increasing production capacity at its Modipuram plant in Uttar Pradesh to more than half a million bias truck and bus tyres in 2011. This is expected to go up to more than one million units in 2013. With the expansion, the annual capacity of the facility is expected to increase to 900,000 passenger tyres and 200,000 truck tyres. The company will also invest more than EUR50m (USD72.3m) to start production of radial tyres for passenger cars and commercial vehicles in the second half of 2013. July 2011: Beru Diesel Start Systems, a JV between Jayant Group and Germany-based Beru, has invested INR300m (USD6.7m) in a new greenfield facility at Talegaon, Maharashtra to manufacture glow plugs. The new plant has increased the companys production capacity from one million unit glow plugs to five million units a year. The JV supplies to all major automakers in India including Ashok Leyland, Fiat, Ford, GM, Mahindra & Mahindra, Mercedes-Benz, Nissan-Renault, Tata Motors and Volkswagen. July 2012: Mahindra Ugine commenced commercial production at a manufacturing plant in Pantnagar, Uttarakhand. The company invested INR366.5m (USD8.2m) in the new plant which will produce stamping components for automakers present in the region including Mahindra & Mahindra and Tata Motors. June 2011: Rane Group has increased capital expenditure targets for most of its group companies. The group plans to invest INR2.39bn (USD52.1m) through 31 March 2012. Rane Engine Valve, which makes engine valves, valve guides and tappets, received the maximum increase in the allocation to INR486m (USD10.6m) in the current year from INR240m (USD5.2m) in the previous year. June 2011: Bridgestone India commenced production of truck and bus radial tyres at its Kheda plant in Madhya Pradesh. The company has invested around INR1.7bn (USD37.4m) in the facility and aims to produce 200 tyres per day by the end of this year. Production capacity will be raised further to 400 tyres a day by July 2012. June 2011: GKN Driveline broke ground on a new manufacturing facility in Pune, Maharashtra to produce constant velocity joint (CVJ) systems and trans-axle solutions. The company will invest INR1.3bn (USD28.6m) to establish the facility. Employing more than 200 people, the facility is expected to be on stream by August 2012 with an annual production capacity of more than 600,000 CVJ systems. It will also produce differentials for the
JBM Auto
Continental
Beru Diesel Start Systems
Mahindra Ugine
Rane Group
Bridgestone
GKN Driveline
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Company Ashok Leyland
Remarks company's trans-axle solutions. May 2011: Ashok Leyland will invest INR11bn (USD242m) to INR12bn (USD263.9m) in the current fiscal year (FY) ending 31 March 2012, of which INR4bn (USD88m) will be utilised for setting up a Neptune engine facility. Filter May 2011: Mahle Filter Systems India commenced series production of air filter modules at its new manufacturing facility in Chennai, Tamil Nadu. In the medium term the company intends to expand its product line-up the plant to produce intake modules, and cylinder head covers with integrated oil mist separation.
Mahle Systems
Bosch Electrical May 2011: Bosch Electrical Drives India, a joint-venture (JV) between Bosch and Igarashi Drives India Motors India, has announced plans to invest INR370m (USD8.14m) to set up a plant in Chennai, Tamil Nadu to produce vehicle components such as wiper systems, engine cooling fan modules, air-conditioner blowers and electric window lift drives. The plant is scheduled to become operational by the end of 2012. Ford May 2011: Ford plans to invest USD72m to expand its engine plant in Chennai, Tamil Nadu. Through the investment the automaker plans to raise production capacity at the plant from the current 250,000 engines to 330,000 petrol and diesel engines by mid-2012. The expansion will result in the creation of 300 new jobs at the facility. May 2011: Setco Automotive announced an investment of INR1bn (USD22.2m, 12 May 2011) for the expansion of clutch manufacturing in India. Most of the investment will be utilised to increase production at the Kalol facility near Vadodara and the rest will be utilised to add capacity and for other R&D activities at the Uttarakhand plant. April 2011: Steel Strip Wheels Limited (SSWL) commissioned a new production line at its Chennai facility in Tamil Nadu. The commissioning of a ,new line ramped up the plant production capacity to six million units per annum compared with 2.5 million units per annum earlier. March 2011: Jamna Auto announced investment of INR800m (US$17.6m) to set up two new plants, one each at Hosur and Chennai, both in Tamil Nadu, to manufacture parts for commercial vehicles. The Hosur plant, which manufactures parabolic springs, became operational in December 2011. The plant has annual production capacity of 36,000 tonnes. The Chennai plant, which manufactures air suspension, bogey suspension and lift axles, commenced production in July 2011. March 2011: NTN plans to set up a production facility for constant velocity joints (CVJs) and third-generation hub bearings in Chennai, Tamil Nadu. The facility, located in Mahindra World City industrial area, is expected to start production of CVJs and bearings in April 2012. March 2011: IAC inaugurated its new manufacturing facility at Mahindra Supplier Park in Chakan, Pune, Maharashtra. The new facility, set up with an investment of USD15m, will produce instrument panels, floor consoles, interior and exterior garnish trim, air distribution vents and door panels for Mahindra &Mahindra and Mahindra Navistar vehicles. March 2011: Imperial Auto in agurated a new manufacturing plant in Chakan, Pune, Maharashtra. The plant was set up with an investment of INR250m (USD5.5m). The plant will produce fluid transmission products for Mahindra & Mahindra.
Setco Automotive
Steel Strips Wheel
Jamna Auto
NTN
IAC
Imperial Auto
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Company Bosch
Remarks February 2011: Bosch India announced plans to invest around INR3bn (US$65.6m) to establish a development centre for powertrain electronics in India. The development team will work with Bosch's Diesel and Gasoline Systems- Electronic Controls (DGS-EC) business in India. The company plans to increase its headcount by around 800 across its development centres in Bangalore and Coimbatore within the next two years. February 2011: Toyota Kirloskar began construction of an engine plant in Bidadi, Karnataka. The plant will manufacture 100,000 engines annually from the third quarter of 2012 and 240,000 transmissions from 2013. The company will invest INR5bn (USD10.8m) in the plant. February 2011: Brose established a manufacturing plant at Hinjewadi near Pune in Maharashtra. The plant began operations in April 2011 and produced window regulators in its first year of operation. The new facility started production of manual seat height adjusters in September 2011. The plant will first export components to a European OEM and later supply for the Indian market to a global OEM based in India. In February 2011, Trelleborg Automotive expanded its anti-vibration solutions (AVS) facility in Noida, Uttar Pradesh. The expansion includes an increase in the manufacturing space by 50%, installation of a metal cleaning line and twenty rubber injection presses. As a result of the expansion, new production cells at the Noida facility for manufacturing hydromounts will also be set up. With the new presses, the company expects to reduce cycle times and increase production capacity. The expansion will add to the range of anti-vibration solutions currently offered at the facility. January 2011: Rico Auto began operations at its newly built facility in Sanand, Gujarat. The plant was established to serve the Tata Motors plant in Sanand with an investment of around INR400m (US$8.6m). The company supplies components to Tatas ultra-low-cost Nano car. The company is also planning an investment of nearly INR200m (US$4.3m) for a plant in Chennai, Tamil Nadu, which will begin operations in 2011. January 2011, Bosch announced plans to invest INR23bn (US$492m) in India over the next three years to capitalise on the growing automotive industry in the country. Around 70% of the investment will be earmarked for the manufacture of automotive components such as inline pumps, distributor pumps, specialised spark plugs, injection systems and alternators. The company will scale up its manufacturing capabilities at its plant in Bangalore and Naganathapura, Karnataka; Jaipur, Rajasthan; Nashik, Maharashtra and Verna in Goa and add up to 900 jobs in India this year.
Toyota Kirloskar Auto Parts (TKAP) Brose International
Trelleborg Automotive
Rico Auto
Bosch
JOINT-VENTURES
Company Maier Partner UM Group Remarks January 2011: Maier has partnered with India-based UM Group to serve the Indian automotive sector. The new company, Alpha Maier, will supply plastic units and parts for car manufacturers. The JV plans to invest around EUR5m (USD6.3m, 19 January 2012) in the new project. The company, which has already secured a contract from Indias largest passenger car maker Maruti Suzuki, expects to win orders from automakers including GM, Honda, Nissan and PSA.
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Company NK Minda
Partner Toyoda Gosei, Toyota Tsusho
Remarks December 2011: NK Minda Group announced a joint-venture (JV) with Toyoda Gosei and Toyota Tsusho Corporation to manufacture automotive safety components for Indian car makers. The JV, Toyoda Gosei Minda India Private Limited, will manufacture components including steering wheels, airbags and body sealing parts. The JV is expected to start production from May 2012 in Neemrana, Rajasthan and intends to establish a new plant in Bangalore, Karnataka, within a span of two years. October 2011: Lucas-TVS entered into a business co-operation agreement with Remy International in cross-technology licences, product sales, engineering support and supplier sourcing support. The agreement will allow Remy to license certain component to produce and sell around the world. Similarly Lucas-TVS will receive a licence from Remy to produce and sell some of its products in India. In addition, both parties may buy and resell each other's products. November 2011: Wheels India entered into a technical agreement with Japan-based Topy Industries to design and develop wheels for passenger cars for global customers. October 2011: Minda Industries entered into a JV with Kyoraku Company Limited and Nagase & Company to manufacture blow moulding plastic components. Minda will have a majority stake in the JV company which has yet to be named. Kyoraku and Nagase will hold 16% and 10% stake in the company respectively. September 2011: Commercial Vehicle Group (CVG) formed a JV with Hema Engineering Industries to manufacture seats and seating components. The JV will manufacture components for the Indian commercial vehicles market and will supply seats for CVG's locations across the globe. CVG has a 90% stake in the JV, while the remaining 10% is with Hema Engineering. The JV will lease a production facility in Gurgaon, Haryana. Production is expected to begin in 2012. CVG will also shift its existing business to the JV where the components will be manufactured and supplied to CVG locations globally. August 2011: PPG signed a letter of intent with Harsha Exito Engineering to establish a 50-50 JV for the manufacture and sale of fiber glass reinforcement products. The deal is subject to the completion of due diligence and the negotiation of definitive documentation. Financial details were not disclosed. May 2011: Sumitomo Pipe & Tube and Sumitomo Corporation entered into an agreement with Hyundai Hysco to set up a joint manufacturing company for automotive steel pipes. The JV Automotive Steel Pipe India Private Limited will have a production capacity of approximately 4,000 tons per month of electric resistance welded pipes and cold drawn steel pipes. The JV will invest about
Lucas-TVS
Remy International
Wheels India
Topy Industries
Minda Industries
Kyoraku Company Limited, Nagase & Company
Commercial Vehicle Group
Hema Engineering
PPG Industries
Harsha Exito Engineering
Sumitomo Pipe & Hyundai Hysco Tube , Sumitomo Corporation
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Company
Partner
Remarks INR400m (USD8.8m) in setting up a new plant in Chennai, Tamil Nadu which is expected to become operational by 2012-end. Hyundai Hysco will have a majority stake of 55% while Sumitomo Pipe & Tube and Sumitomo Corporation together will have the remaining sharholdings.
TACO
T. Rad
May 2011: Tata Toyo Radiator, a JV between TACO, T. Rad and Mitsubishi Metal, has entered into a JV agreement with T.Rad to set up a research and development (R&D) centre in Pune, Maharashtra. The centre will develop better solutions for the Indian automotive market. April 2011: Stoneridge and Minda Group expanded their current JV agreement to produce sensor technology and products in India. In the initial stages, the alliance is expected to expand its product offering by manufacturing various high-temperature and other sensor products. Simultaneously, the alliance will utilise technical information licensed by Stoneridge. In turn, Stoneridge will receive royalties from the JV for technically advanced products. The sensor products will serve the commercial vehicle and four-wheel vehicle markets.
Stoneridge
MERGERS & ACQUISITIONS

Acquirer Ring Aqua Plus Acquired Company Trinity India Remarks February 2012: Ring Aqua Plus acquired a 78% stake in Trinity India for INR540m (USD10.9m). The acquired company has operations at four manufacturing locations with an installed forging capacity of 12,500 tonnes. The company manufactures hubs, spindles, connecting rods and similar components and counts Maruti Suzuki, Tata Motors, Fiat, Ford, Force Motors, Ashok Leyland and Hindustan Motors as major customers. January 2012: JBM Group, through its subsidiary JBM Cadmium, acquired a 51% stake in UK-based supplier Tesco GO for an undisclosed sum. The acquired company provides engineering services to OEMs such as Daimler, Fiat, Ford, Lamborghini and Tata and recorded sales of USD20m in 2010. Trinity India January 2012: Ring Plus Aqua, an auto component making unit of Indias Textile major Raymond, has entered into a definitive share purchase agreement to acquire a majority stake in Trinity India, a Pune-based supplier of forged components. The companies have not disclosed the deal value. October 2011: TomTom has increased its shareholding in its Indian
JBM Group
Ring Plus Aqua
TomTom
Tele Atlas Kalyani
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Acquirer
Acquired Company India Private Limited
Remarks joint-venture from 90% to 100% by buying out the remaining 10% stake owned by the Kalyani Group. Following the completion of the takeover, the company renamed the wholly-owned Indian subsidiary TomTom India Limited. October 2011: KSPG acquired Kirloskar Oil Engines' plain bearing business. The divested business includes plants in Pune and Ahmednagar, both in Maharashtra which manufacture plain bearings mainly for the domestic market. The company's bearing business generated sales of EUR20m in the financial year ended 31 March 2011 and employs about 600 people. Products include engine bearings, bushings and thrust washers for light and heavy-duty vehicles and agricultural equipment. The company supplies to OEMs such as Ford, Honda, Maruti Suzuki, Mahindra & Mahindra, Hyundai and Tata Motors. July 2011: Motherson Sumi, the flagship company of India-based Samvardhana Motherson Group (SMG), acquired an 80% stake in German automotive plastic parts supplier Peguform in a deal worth EUR72.17m (USD104m). Motherson Sumi closed the deal in November 2011. July 2011: Continental acquired full ownership of Modi Tyres from Modi Rubber. The acquired business now operates as a whollyowned subsidiary of Continental and has been renamed Continental Tyres India Ltd. The deal, valued at INR1.3bn (USD28.6m), includes a payment of INR1.1bn (USD24.2m) for share acquisition and INR172m (USD3.7m) as non-compete fees. June 2011: Dynamatic Technologies has acquired operations of Eisenwerke Erla in Germany and India. The acquisition will give the Indian supplier design, development and manufacturing capabilities with respect to high precision, complex metallurgical products for automotive engines and turbochargers. The acquired company operates manufacturing facilities in Erla (Germany) and Chennai, Tamil Nadu (India). April 2011: Dana entered into a agreement with Axle India Limited to acquire selected assets of its commercial truck-axle operations. Under the agreement, the US supplier will take over full-ownership of Axle Indias axle drive head and final axle-assembly operations.
KSPG
Kirlosker Oil Engines
Motherson Sumi
Peguform
Continental
Modi Tyres
Dynamatic Technologies
Eisenwerke Erla
Dana
Commercial Vehicle Axle business from Axle India
Source: IHS SupplierBusiness Suppliers operating in India have recorded strong growth through organic and inorganic routes. The joint-ventures continue to play a key role in the growth of the domestic suppliers, but of late these companies have been investing in new facilities to ramp up capacities. Several suppliers are also actively seeking to expand their presence in international markets through acquisitions. As the Indian market matures, consolidation in
54
the industry is expected to continue in the coming years. The rapid growth has also caused the relationships between suppliers and automakers to evolve. The next chapter discusses the various facets of this changing relationship between the two major stakeholders of the Indian automotive industry.
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OEM-SUPPLIER RELATIONSHIP
The relationship between automakers and suppliers has changed phenomenally over the past 30 years in India. In the early 1980s, local automakers produced most of the critical components in-house and sourced non-core components from suppliers generally, automakers designed the components and all suppliers were required to do was manufacture. As a result, suppliers focused more on improving production efficiencies rather than research and development (R&D) capabilities.
INVOLVEMENT OF AUTOMAKERS IN SUPPLIER DEVELOPMENT

The contours of OEM-supplier relationship started changing when some Japanese automakers entered India in the early 1980s through joint-ventures (JVs) with local companies foreign OEMs were then allowed to hold up to a 40% stake in those JVs. Besides, these new players were required to achieve a certain level of localisation within a short period as the government discouraged imports of components to prevent outflow of foreign currencies. Such regulations forced Japanese automakers such as Honda and Suzuki to develop their own supplier base in India. These automakers encouraged their suppliers in Japan to invest in India. However, like automakers, suppliers could also enter India only through JVs. In some cases the automakers urged their suppliers in Japan to form technical alliances with Indian companies wherever a JV was not feasible. Maruti Suzuki started with a clean slate, barring a few basic components such as tyres, batteries and wheels. Initially, the automaker avoided suppliers which were catering to other carmakers such as Hindustan Motors and Premier. Maruti Suzuki entered several JVs to attract Japanese suppliers to invest in India. Besides providing financial and technical assistance, the automaker allowed some companies to set up facilities inside its manufacturing complex in Gurgaon, Haryana. Although Maruti Suzuki later exited some JVs, the automaker still has stake in some. Presently, the company operates 19 JVs and affiliates, of which 11 are located in its supplier park in Gurgaon. Table 2: Maruti Suzuki has 19 JV vendors, 11 of which are located in its Supplier Park enabling component delivery not only just-in-time but also just-in-sequence Supplier Mark Exhaust Systems Bellsonica Auto Components Krishna Ishizaki Auto FMI Automotive India Inergy Automotive Manufacturing India Maruti Suzukis shareholding 44.37% 30% 15% 49% Systems 26% Components Exhaust systems components Sheet metal components Automotive mirrors Exhaust systems components Plastic fuel tanks Electronic control units (ECU) for diesel engines.
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Magneti Marelli Powertrain India 19% 2007

Supplier Suzuki Powertrain India Climate Systems India Manesar Steel Processing SKH Metals Jay Bharat Maruti Caparo Maruti Machino Plastics Bharat Seats Krishna Maruti Denso India Asahi India Glass Nippon Thermostat India Sona Koyo Steering Systems
Maruti Suzukis shareholding 30% 30% 15% 48.71% 29.28% 25% 15.35% 14.81% 15.80% 10.27% 11.11% 10% 6.94%
Components Diesel engines and transmissions Heating, ventilation conditioning (HVAC) Automobile processing steel and air
sheet
Fuel tanks, sheet metal parts Sheet metal component and assemblies Sheet metal stamping, weld assemblies and closures Plastic moulding components Automotive seating systems Automotive seating systems Alternators and starter motors Automotive glass Thermostates, temperature Steering systems sensor water
Source: IHS Research, Maruti Suzuki Annual Report 2011-12
DIRECT INVOLVEMENT DECLINES POST-LIBERALISATION

More automakers from the US, Europe, Japan and South Korea entered India after the economic reforms of 1991. As a result, many global suppliers also set up manufacturing facilities in India to cater to their customers in the local market. Further, a gradual removal of local content requirement meant that automakers did not need to become directly involved with suppliers in order to meet required localisation. However, automakers like Maruti Suzuki in a bid to lower production cost are still taking the JV route to pursue suppliers to start production in the local market. For example, in 2007, Maruti Suzuki formed a JV with Italy-based supplier Magneti Marelli to produce electronic control for diesel engines. The Italian supplier has a 51% stake in the JV Magneti Marelli Powertrain India while Maruti Suzuki has 19% and Suzuki Motor 30%. The economic reforms transformed the OEM-suppliers business model in India. Earlier, there was one-OEMto-one-supplier concept prevalent in the country, where a supplier used to supply to a single automaker only. However, this model changed over the years as automakers reduced their dependence on a few suppliers, and allowed suppliers to cater to
more automakers. This diversification significantly reduced business risks for suppliers and OEMs. Thus one-OEM-to-one-supplier gave way to a model where an OEM was free to source a component from multiple suppliers and vice versa. As a result, the relationship between automakers and suppliers has become more professional.
GREATER LOCALISATION RELATIONSHIP
DRIVING
BETTER
OEM-SUPPLIER
Unlike in some other emerging markets, localisation in India a price-sensitive market is not driven by government policy but by automakers need to reduce cost of production. The race for localisation is more apparent in highly competitive small car and entry-level sedan segments, where some models have achieved more than 90% parts localisation. Ford is doing the necessary. "It is so important in India to have at least 80-85% localisation to be successful and competitively price position your vehicles in the volume segment, Michael Boneham, Ford India President told IHS SupplierBusiness in an interview. The automaker claims that it has localised its Figo compact, launched in India in March 2009, to 85%. Rivals are striving to similar ends. Most of the small cars manufactured by Maruti Suzuki and Hyundai have a localisation level of more than 90%. Some new models have also achieved a high level of localisation Nissans Micra (launched in July 2010) is 85% localised, Hondas Brio (launched in September 2011) is 80% localised the automaker plan to increase it to 90% in the second half of 2012, Volkswagen Polo (launched in February 2010) and Toyota Etios Liva (June 2011) have achieved a 70% localisation each. Needless to say, a greater emphasis on localisation will continue as OEMs line up new models based on global platforms for the Indian market. GM plans to launch six new models and 14 new variants by end-2013. Skoda intends to launch five models by end-2013. Ford is planning to launch eight new models in India by 2015. A vast majority of the eight new products that we are going to launch in India over the next five to six years are going to be global products, following our core global platform strategy so the challenge is how to get the levels of localisation we need here in India which is about 80% plus for products that will be positioned in the volume segment, along with how we compete with the globally sourced suppliers to get the economies of scale, added Boneham. The drive for localisation has often resulted in close automaker/supplier coordination. As most of the vehicles launched in India are still being developed in foreign countries, the automakers are either asking their global suppliers to set up plants in India or encouraging local suppliers to develop similar components either through in-house R&D or through partnership with the original suppliers. Many global suppliers have already opened facilities in India through wholly-owned subsidiaries, JVs or technical alliances. Some global suppliers, however, are still weighing their options to enter India. This presents an opportunity for the Indian suppliers to join hands with global suppliers and win contracts from foreign OEMs.
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TECHNOLOGY REMAINS A BIG CHALLENGE FOR INDIAN SUPPLIERS

The Indian suppliers are not investing in R&D the way they should. They continue to rely on JVs or alliance partners for technologies. For example, in December 2011, NK Minda entered into a JV with Toyoda Gosei and Toyota Tusho to manufacture safety systems components such as airbags and steering wheels, which were completely new business areas for the Indian suppliers. In 2010, the company partnered with Kosai Aluminum to enter into production of alloy wheels, again a new business for NK Minda. Some local suppliers, however, are taking the acquisition route in order to gain expertise. When Motherson Sumi acquired Visiocorp in 2009 it had instant access to the technologies developed by the European supplier in rear view mirrors. In July 2011, the company acquired majority stake in Peguform, a major supplier of door panels and instrument panels in Germany. This significantly strengthened the companys presence in automotive plastics. Experts reckon that Indian suppliers are likely to stay away from investing heavily in R&D unless they are promised big business by their customers. The supply base must have enough business and volume to invest in R&D and indigenous technology. Quite a few Indian suppliers have gone through acquisitions to acquire that capability. However, there are many others that cannot justify enough investment in R&D to develop that capability so they would tend to become tier-two suppliers to major tier-ones, Sandip Sanyal, Executive Director-India New Projects, Ford India, told IHS SupplierBusiness in an interview. Experts think that in the medium to long term, the local suppliers with a lackadaisical attitude towards R&D will become marginalised or be forced to move down to lower tiers of the automotive supply chain. Generally, a supplier will be able to hold its position so long as it manages to get the required technologies either by developing them in-house or through partnerships or acquisitions. But local suppliers argue that except for some models by Tata Motors and Mahindra & Mahindra, most automakers develop new models outside India so Indian suppliers rarely face the challenge of developing new products. Besides, technology is helping global suppliers win business from local automakers. The new generation of vehicle buyers in India is increasingly looking for features in areas such as safety systems, driving assistance and infotainment systems. Global automakers find it easier to respond to these trends. Indian automakers depend on global suppliers for such new-age technologies. In some cases Indian OEMs are pushing their local suppliers to partner global suppliers for such technologies. As far as technologies are concerned, we do find we still need to depend on multinational suppliers for giving us state-of-the-art products. What we look for in the supplier is not just a supplier of parts, but a solution provider. We depend on multinational suppliers either through working directly with them, or asking our current suppliers to tie up with them and work through them, Bharat Parekh, Chief Strategic Sourcing at Tata Motors, told IHS SupplierBusiness in an interview.
AUTOMAKERS CLOSE-KNIT SUPPLIERS

Unlike in North America or Europe, some Indian OEMs still have a few close groups of suppliers. Maruti Suzuki, for instance, built a network of suppliers in 1980 through JV agreements with them. The company still sources major components from these close
suppliers. Tata Motors and Mahindra & Mahindra have also developed their own family of suppliers over the past 20 years, though differently. Tata Motors parent company, Tata Group, set up a component company called Tata AutoComp (TACO) which entered into as many as 16 JVs with major global suppliers including Johnson Controls (for seating systems), GS Yuasa (batteries), T. Rad (radiators and inter-coolers), Ficosa (rear view mirrors, command and control cables), Hendrickson (suspension system for commercial vehicles) and Yazaki (wiring harness) these JVs together operate 44 manufacturing plants. These JVs also supply to other automakers operating in India. Mahindra & Mahindra has also strengthened its auto component business under Mahindra Systech mainly through acquisitions during the past decade. The companys major acquisitions include Schoneweiss (axle-beam), Jeco Holding (forging), DGP Hinoday (castings and ferrites), Falkenroth (forgings), Stokes Group (forgings), Amforge (forgings), Plexion Technologies (engineering services), Metalcastello (castings), SAR Transmissions (gears) and Engines Engineering (automotive). While in most cases the close associations with automakers have helped suppliers secure additional business, there have been few instances where an automaker went out of the way to give new contracts to suppliers outside its vendor base. Sometimes, the need for advanced technology leads these automakers to look outside. In 2005, when Maruti Suzuki launched its first global model Swift in India and other international markets such as Japan, China and Europe, the company brought in several global suppliers such as Bosch, Continental, Delphi and Faurecia in its network base. Later, the inclusion of other strategic models such as A-Star (known as Alto in international market), Ritz (sold as Splash outside India) and SX4 further increased the automakers dependence on global suppliers who can supply similar components to the companys manufacturing plants worldwide. Under the current sourcing strategy, Maruti and its parent company Suzuki take decisions on development and sourcing of 150 critical components jointly, while the smaller components are left to the Indian automakers supply chain.
COST, QUALITY, DELIVERY (QCD)

According to ACMA, India has 12 suppliers who have won the Deming Prize, which is the largest number outside Japan. In addition there are 15 suppliers who have won the Total Productivity Management (TPM) award, three Japan Institute of Plant Maintenance (JIPM) awards and one Shingo Silver Medallion and one Japan Quality Medal awards. Automakers acknowledge that Indian suppliers are moving up on quality. The vendor quality levels have definitely improved from the past and vendor rejection parts per million (PPM) levels are going down, but we would like them to be even better and widely spread across all vendors. Rahul Bharti, Head, Corporate Planning at Maruti Suzuki, told IHS SupplierBusiness. Bharat Parekh, Chief Strategic Sourcing, Tata Motors, says, We insist that all our suppliers should have certain ISO standards. Over and above that we have mechanisms to monitor quality including our people visiting suppliers, working with them if they require support to ensure their quality is in compliance with our target. Despite all the efforts, quality is still a major concern that we have in terms of variability.
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Meanwhile, suppliers argue that many automakers do not recognise the fact that better quality comes at higher costs. However, there is a difference in the way local and global automakers perceive these cost and quality issues. In India, we have two kinds of OEMs. One, those who are aligned to the global levels, and second, those who are trying to become aligned to those levels. When it comes to the second type of OEMs, their definition of quality is quality at the lowest price. There is a difference between price and quality; there is mismatch between price and quality. I think a supplier understands this a lot more than an OEM understands, said Baba Kalyani, Chairman of Bharat Forge during ACMAs 2011 annual convention. He stressed that this gap between expectations of quality and what price local automakers are going to pay needs to be bridged. However, he agrees that the global OEMs, with their several decades of experience, understand this extremely well and therefore suppliers are not required to deal with such issues while dealing with them. While cost, quality and delivery remain decisive factors for automakers in selecting suppliers, OEMs now look for much more. "Beyond the conventional criteria of quality, cost and delivery, OEMs across the world prefer to engage with suppliers who have stable lines of communication, good work culture, effective process orientation and end-customer knowledge, said Srivats Ram, former President of ACMA and Managing Director of Wheels India Limited. For example, Maruti Suzuki has taken several initiatives to help its suppliers. Every year the automaker organises a vendor conference where top executives share their thoughts and best practices. The company has set up a supplier club where it discusses various operational and social issues with the management of the selected suppliers. Maruti Suzuki monitors the financial health of its suppliers and provides guidance on various financial matters. The companys senior management and engineers visit suppliers every year in July to generate value analysis and value engineering (VA-VE) ideas. Generally, such ideas help suppliers to improve manufacturing and cost efficiencies. Maruti Suzukis HR team meets HR head of JV companies to review issues related to industrial relation. The automaker has set up Maruti Centre of Excellence (MACE) to upgrade suppliers and share their own best practices to enhance their competitiveness.
INDIAS EMERGENCE AS A SOURCING HUB

Several OEMs and suppliers have established international purchasing houses (IPOs) in India. According to ACMA, more than 50 IPOs are currently operating in India. In addition, local subsidiaries of the global automakers and suppliers are engaged in procuring components for their manufacturing facilities outside India. Basically, two types of sourcing are happening in India. One is where IPOs set up by global automakers and suppliers are sourcing components from the suppliers operating in India. Another is being managed by automakers themselves. The low cost of production has attracted these automakers to produce major components such as engines and transmissions in India to meet requirements at their global assembly plants. For example Ford India exports engines manufactured at its Chennai plant in Tamil Nadu to the assembly plant of the parent company in Thailand, operated by AutoAlliance Thailand (AAT), a global
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alliance between Ford and Mazda. Our objective is to transform India into an export hub not only for automobiles, but also for components. Currently, we export around 60,000 engines and we want to raise it by 56% by 2012, said Nigel E. Wark, Executive Director, Marketing & Sales Service, Ford India. Recently several automakers have announced their sourcing plans. While some are quite ambitious and have even set targets, others are intensifying sourcing activities without definite targets. In December 2011, Volkswagen announced plans to triple its annual sourcing from India to over EUR300m over the next three to five years. The company intends to double the number of component suppliers to 200 from India. In September 2011, Honda announced plans to increase components exports tenfold from India to its other Asian facilities to INR1.1bn (USD22.1m) for the FY2012 compared with INR113m (USD2.3m) in FY2011. The Japanese automaker sources powertrain components for its City and Jazz models manufactured in Indonesia and Malaysia and Brio in Thailand. In August 2011, Nissan announced it would increase component sourcing from India to USD100m in the financial year ended 31 March 2012, compared with USD40m the previous year. Nissan is sourcing components such drive plates, oil pumps, starter motors, brake pedals and clutch pedals to meet requirements at its assembly plants in Thailand, China, Japan and the UK. In May 2011, Renault announced it would source components worth EUR100m from India by 2012. The company sourced components worth EUR35m in 2010 from India which is expected to be around EUR75-80m in 2011. In October 2010, GM announced its intention to double its sourcing from India to USD1bn over the next two years. The US automaker has already placed USD550m worth of orders with its Indian suppliers. The company has a vendor base of around 250 suppliers in India, of which 72 will also supply components for its global requirements. GM sources forging, casting and metal components from India.
Some Indian suppliers have recently secured orders from premium automakers. For example, Chandigarh-based Steel Strips Wheels Limited (SSWL) has received orders from European automakers such as BMW, Renault, PSA Peugeot Citron and Volkswagen over the past three years. The March 2011 earthquake and tsunami in Japan exposed the supply chain constraints of many automakers Honda and Toyota were severely impacted as their suppliers struggled to resume operations for several weeks. The delay in resumption of parts supply forced automakers to even halt operations at their overseas plants. Japanese automakers also faced supply chain constraints due to massive floods in Thailand in the second half of 2011. This led Japanese automakers to consider souring components from other regions including India.
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ACMA is working closely with IPOs operating in India. The association has established an IPO Forum and organises IPO/supplier meetings to promote relationship between the IPOs and the component industry. One of the new initiatives taken by the IPO Forum improving quality of suppliers by addressing internal processes and supply chain capability in managing the projects efficiently. Amit Mukherjee, Deputy-Executive Director of ACMA, says, It is a networking forum for IPOs also because they share their concerns and how we are addressing those concerns. It is also an opportunity for suppliers to address some of the concerns, and how that could be addressed, what are the requirements, what are the potentials and opportunities. They also undertake a lot of training, and we are developing training programmes. Project management is one area that has been addressed by the IPO Forum. With Indias rise as a major component sourcing hub, the local suppliers responsibilities in adhering to stringent quality requirements and delivery schedules will only grow. A small deviation in either of these two could create problem at the assembly units of the global automakers or suppliers. Rico Auto is a case in point. A strike, which lasted almost two months at the parts maker in 2009, halted operations at several GM facilities in the US. The strike also caused Ford to halt production for a week at one of its plants in Canada. There is little doubt that the OEM-suppliers set-up in India will become more professional in the coming years. Today, automakers cant commit a contract to a particular supplier on the basis of old relationships; now it is more about meeting quality, cost and delivery (QCD) expectations of the former. In order to remain competitive, suppliers are opening their plants close to the manufacturing facilities of their customers. This has resulted in the emergence of several automotive clusters in India. The next chapter throws light on the active automotive clusters in India and what they mean for the supplier industry.
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AUTOMOTIVE CLUSTER DEVELOPMENT

Clusters in India typically consist of tier one, tier two and tier three suppliers, with the tier three suppliers forming the broad base of the pyramid. The tier three suppliers group mostly comprises foundries, forging units, metal forming and heat treatment units which dont require much skill and expertise. As one goes up the pyramid, the number of tier two and tier one suppliers in a cluster narrows. A supply chain cluster typically involves three or more companies working together at a particular geographic location. They usually extend complementary core competencies through collaborative mechanisms. A tier one supplier is likely to adopt a hub-and-spoke model of a value chain cluster where a number of smaller companies will be supplying products to the tier one supplier. The very nature of a broad scattered supplier base brings the importance of clusters into the limelight. Sunil Shrivastava, handling Corporate Materials at Minda Group told SupplierBusiness in an interview that a wide gap exists between OEMs and the various tiers of suppliers. To bridge the gap and to get all suppliers to match the Quality, Productivity, Cost, Delivery, Safety, Morale (QPCDSM) levels, it is the tier one suppliers who are largely responsible. Usually, an OEM will share the details of the desired level of the product, and leave the rest of the work such as R&D, drawings and tooling to the tier one supplier. To meet the quality levels desired by an OEM, tier one suppliers, such as the Minda Group, have taken help from cluster development activities. The groups supplier base includes more than 260 companies, catering to the requirements of 23 manufacturing plants spread across the country. Shrivastava says, typically, in clusters, tier one suppliers usually guide and oversee the quality of the product rolling off the production lines of second and third tier suppliers. He adds, If you need to have overall growth, then we need to go up to the end of the chain, it cant stop at tier one. For its cluster activities, Minda selects tier two suppliers based on several parameters, including the business volume generated from Minda (usually 50%) or the level of dependency on the group for sales. The exercise is intended to rationalise the supplier base minimum number of suppliers which can cater to large orders of the group. The focus is largely on component suppliers, rather than raw material or packaging providers as component suppliers are an integral part of your supply chain, and they affect the delivery, quality, performance, development of your company, says Shrivastava. Working in clusters can be, in a way, termed as a proactive approach to tackle quality issues. In a cluster, a tier one supplier will chart a path through which each tier two supplier has to work to finally produce a component including a specific set of activities and requirements which need to be met at various pre-defined levels. Clusters involve a high degree of sub-contracting, because it is difficult for one supplier to produce all elements of an auto part themselves in-house. In the absence of subcontracting, the supplier will have to bear the burden of setting up and maintaining a huge infrastructure
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which may be difficult to manage. Further, adhering to OEM-specified quality standards can pose a big problem if the supplier fails to handle affairs. The clusters are advantageous not only for OEMs, but also for suppliers. An automotive small and medium enterprise (SME) in India can be classified on the basis of revenues: more than INR5bn (USD94.7m), between INR2bn and INR5bn (USD37.8m-94.7m) and less than INR2bn (USD37.8m). As is common across many industries, the bigger the SME, the higher bargaining power it will exercise. Raw material suppliers, typically falling in the third category (less than INR2bn), will face a greater threat of substitution and a high level of competition. In comparison, makers of an important component, such as an engine, will add more to the entire value chain than a raw material supplier will and is also likely to receive greater support from the OEM. If these companies are working together in a cluster, the risk levels will be mitigated as an OEM will more likely source components from within a cluster, rather than scouting for materials outside which may or may not conform to its quality standards. On a broader geographic level, India has clusters in three regions: north, west and south.
NORTHERN REGION
The northern cluster stretches across three prominent states and includes the national capital region (NCR), which includes Delhi, Gurgaon, Manesar, Faridabad (all in Haryana) and Noida and Ghaziabad (both in Uttar Pradesh). The Northern cluster is remarkably well established, even though it is newer than the other two clusters (in west and south), and houses the highest number of suppliers among the three. According to Automotive Component Manufacturers Association of India (ACMA), more than 250 suppliers are based in the northern cluster, while both southern and western clusters have more than 200 suppliers each. Cluster development in north India started with the entry of Maruti Udyog Ltd (now Maruti Suzuki India Ltd) in 1981, when the automaker announced it would set up a plant to roll out 100,000 vehicles annually, a big number in the days when a passenger vehicle in India largely meant Hindustan Motors Ambassador and Premier Automobiles Padmini. Maruti was joined by Hero Honda (now Hero MotoCorp) in 1984. Hero Honda aimed to grab a greater share of the motorcycles segment in India which was largely dominated by scooters at the time. Both companies encouraged their suppliers to locate close to their operations gradually many auto parts makers started production facilities in the NCR area. Suppliers received support from the Japanese OEM in setting up operations, and a common characteristic of many suppliers in the NCR cluster is Japanese investment/equity stake in them and their high reliance on Maruti Suzuki for business such as Sona Koyo, Jay Bharat Maruti, Asahi India, Bharat Seats, Denso India and Krishna Maruti. Many parts makers who supplied Suzuki with components in Japan followed the OEM in India and started joint-ventures with domestic Indian suppliers. In fact, Bharat Seats, Caparo Maruti, Jay Bharat Maruti, Machino Plastics and SKH Metal are located at Maruti Suzuki India Ltds joint-venture complex in Gurgaon. What started with Suzuki supplier development was eventually capitalised by other OEMs too, who entered in the 1990s and later, including
South Koreas Daewoo and Honda Siel. Other major OEMs who have presence in north India include Eicher, Swaraj Mazda, Bajaj, Escorts and Yamaha. Apart from the NCR cluster, another cluster that is gradually growing in northern India is in Haridwar and Pantnagar (in Uttarakhand). In an effort to support automotive industry developments, the state of Uttarakhand provides incentives such as 100% exemption from income tax for the first five years and 30% exemption for the next five. Also, the state provides full exemption from excise duty for 10 years.
SOUTHERN REGION
The auto cluster in south India, encompassing Bangalore, Chennai and Hosur, has been in existence since the 1950s. At that time, suppliers in the cluster relied mostly on TVS Motors and Standard Motors. By 1990s, OEMs such as Hyundai, Mitsubishi and Ford set up their presence in the region, leading to growth of suppliers focused on passenger car and commercial vehicles parts. The Chennai cluster is also known as Detroit of India due to its importance in the Indian automotive industry. According to a report published in the Businessworld magazine, Chennais automotive industry has seen investments of more than USD7bn since 2006. The majority of suppliers in the region produce pumps (fuel, oil and water), powertrain, steering gears and bearings. Many suppliers in Chennai are part of the TVS Group such as Brakes India, Wheels India, Lucas TVS, Sundaram Clayton, Sundaram Dynacast and Sundaram Fasteners. Apart from the TVS Group, a strong player in the region is the Rane Group, which operates many component supply companies.
WESTERN REGION
Much as in southern India, the automotive cluster in the western part started in the 1950s, when Tata Motors, Bajaj Motors and Force Motor set up operations in Maharashtra state. The cluster in Maharashtra includes Mumbai, Pune, Nasik and Aurangabad regions. But the western region grew in prominence when foreign automakers such as Skoda, Volkswagen, Ford, Audi, and Renault established their presence in the state. Pune, in particular, has seen the entry of many foreign OEMs, especially in Pimpri-Chinchwad area. Also, Chakan, Talegaon and Ranjangaon house a large number of big auto suppliers. Now, the western part of India has two main clusters one in Maharashtra and one in Gujarat (Sanand and Halol).
GROWTH OF CLUSTERS
The cluster development is supported by many agencies and organisations in India, including ACMA. The association acts as a catalyst in providing development opportunities to various players. Through the ACMA Centre for Technology (ACT), the organisation undertakes quality and technology upgrade programmes focused on suppliers in clusters. These programmes extend from 12-30 months, targeting companies across different levels (based on annual turnover). Apart from quality clusters, ACMA plans to set up more clusters for enhancing productivity, marketing and logistics. The Confederation of Indian
Industry (CII), an industry body, has also helped in setting up clusters across India, with the help of its strategic partners. The government also supports cluster development programmes through various ministries. Under the Industrial Infrastructure Upgradation Scheme (IIUS) of the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, the Pune Auto Cluster started operations in 2007 as a INR1.25bn (USD23.6m) project. The industrial cluster aims to bring SMEs under one roof.
GUJARAT EMERGING AS MAJOR CLUSTER

Government support has been spurring growth of the auto cluster in Gujarat. The Sanand region in Gujarat came under the spotlight in 2008 when Tata Motors shifted its plants to manufacture its small car Nano from West Bengal to Gujarat. M. Sahu, Principal Secretary Principal Secretary, Industries & Mines department, government of Gujarat, told the business today magazine, "The Tata investment clearly gave the necessary impetus and set auto investment into the state on a higher trajectory". Since then, easy availability of barren land and favourable policies of the Gujarat government have attracted many auto companies to the region. The Gujarat government is focusing on increasing the contribution of manufacturing activities in the states gross domestic product (GDP) from the current 31% to 40% by 2025, and as a result is promoting the auto industrys development. The state is now known for fast execution of investment plans, including acquisition and licensing of land. Further, the processing of projects is largely hassle free in early 2011, CEAT started operations at its radial tyres plant in Halol set up with an investment of INR6.5bn (USD123m). Under an industrial policy of 2009, Gujarat has launched an Assistance to Mega and Innovative Projects programme which provides benefits such as road links, support to ancillary units and financial assistance. Apart from government support, availability of required infrastructure (such as land, electricity, water) has gained an important place in cluster development. Gujarats connectivity with three sea ports is a major factor driving growth of the cluster in the region. An advantage that Sanand has, and which has led to its growth as a cluster, is the regions proximity to Gujarats capital, Ahmedabad. Besides Tata Motors, now Ford and PSA Peugeot Citron have now also announced plans to invest INR40bn (USD757.4m) each to establish vehicle production units in Sanand. B. B. Swain, Vice-Chairman and Managing Director, Gujarat Industrial Development Corporation (GIDC) says that by 2014, Sanand will emerge as a big hub of the automotive industry, akin to Chennai and Pune. OEMs too support cluster-development activity. In Sanand, Tata Motors has helped many suppliers set up base close to its assembly lines. JBM Auto is one of the suppliers that started a manufacturing plant in Tata Motors vendor park at Sanand. Sona Group too has a plant operational in Sanand. In 2010, Tata AutoComp outlined an investment of INR3bn (USD56.8m) to expand its presence in Gujarat which involves opening five units at Tata Motors vendor park. In 2010, more than 40 vendors were allocated space in the automakers vendor park.
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Another OEM which operates a vendor park in the western part of the country is Mahindra & Mahindra. The automaker has a supplier park in Chakan, near Pune. In March 2011, International Automotive Components (IAC) set up a USD15m facility to supply interior parts at the Mahindra Supplier Park. Volkswagen too has a vendor park in Chakan, located within the automakers 230 hectare plot. In the north, Maruti operates 19 clusters of Maruti Centre of Excellence, a programme which was started in collaboration with suppliers. The centres provide consultancy and training support to the OEMs suppliers. In September 2011, Maruti announced plans to start a new cluster, comprising component manufacturers, for supplies to its plant at Manesar. The facility is expected to be built nearly 70km away from Manesar, at Rohtak, in Haryana. The ancillary cluster, spread over 100 acres, will be set up near a Maruti R&D centre currently under construction. The company plans to invest INR180bn (USD3.4bn) at Mehsana in Gujarat, including INR60bn (USD1.1bn) for an ancillary unit. The investment, spread across three phases, is primarily to export vehicles produced at the location.
COMPETITION AMONG CLUSTERS

The auto clusters in India face a high degree of competition from each other and often one clusters loss is anothers gain. A recent case in point is PSA Peugeot Citron. The automaker was in talks with the Tamil Nadu government to establish a plant in Chennai, which involved an investment of INR40bn (USD757.4m) and creation of 20,000 job opportunities. The opportunity was significant for the Tamil Nadu government to strengthen the auto cluster in Chennai and to position it as one of the five leading clusters in the world. But the automaker chose Sanand (Gujarat) over Chennai eventually driven by factors such as availability of land, fewer land procurement hassles and existing presence of suppliers. Ford too chose Sanand over Chennai to set up its second plant. Both automakers are spreading their risks through investments in different parts of the country. Despite this tug of war between clusters, these regions except for the eastern part are more or less evenly positioned in terms of catering to the growing automotive demand in the country. The eastern belt of India too saw a short-lived spurt in cluster development when Tata Motors decided to set up base in Singur, West Bengal. Eventually, with Tata Motors moving out of the state, the auto industry in the region couldnt see much growth. But the region, including Jharkhand, can gain importance in the coming years, as more OEMs set up shop in India. Development of infrastructure in the eastern region and political support are critical for the regions emergence as a prominent auto hub. The auto industry players are still sceptical of investments in the region after the Tata Motors land acquisition row in Singur. Farmers agitation, supported by the then opposition leader Mamata Banerjee (now Chief Minister of West Bengal), forced Tata Motors to pull out of West Bengal. But now the government plans to build the region as an auto cluster, and support the growth by putting adequate infrastructure in place. Recently, the Indian government announced plans to set up two auto hubs in central and eastern India. The hubs will be spread across 10,000 acres each. Praful Patel, Minister for Heavy Industries and Public Enterprises, said in The Economic Times, There is need to make India cost competitive and a large-scale
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manufacturing destination that would help it emerge as a front-runner for low-cost production globally. With a broader manufacturing base spread out to various states in the country, the automotive industry can collectively deal with some of the pertinent issues such as logistics costs. In India, logistics and infrastructure issues are very crucial. Michael Boneham, Managing Director, Ford India, said in a report in business today magazine, "You cannot afford high logistics costs if you are selling small cars where margins are very thin." Clusters in the western and southern parts of the country are connected through sea ports, facilitating easy movement of shipments and exports. Automotive industry players in India are taking a calculated approach to mitigate their risks and certainly do not believe in putting all their eggs in one basket. Hedging risks is an obvious step for industry players, as no location is perfect. While Gujarat may boast of strong infrastructure and a more favourable state government, availability of skilled labour is still an issue (as the cluster is still newer than others). Chennai, on the other hand, has a strong cluster with no shortage of skilled manpower and suppliers, but faces infrastructure issues such as inadequate power. Hyundai sources components from more than 500 vendors in Tamil Nadu, while Ford has more than 60 vendors in its list from the state. Overall, clusters are expected to remain a vital feature of the Indian automotive industry, as vehicle demand increases and OEMs expand their operations in the country. Despite the challenges, every cluster has its strong points which lure automakers to set up base in a particular region. With development in infrastructure and government initiatives to support suppliers, clusters will continue to be critical for supplier development.
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Figure 30: Map of Automotive Clusters in India
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Table 3: List of Automotive Clusters in India

Cluster/Region North : Delhi Haryana (Faridabad, Gurgaon, Manesar) Uttar Pradesh (Ghaziabad, NOIDA) Uttarakhand (Pantnagar, Haridwar) Punjab (Ludhiana, Jalandhar, Hoshiarpur, Phagwara) Himachal Pradesh (Parwanoo, Una) South: Tamil Nadu (Chennai, Hosur) Karnataka (Bangalore, Hubli, Dharwad) Andhra Pradesh (Vijaywada) Major OEMs Major suppliers
Maruti Suzuki, Honda Siel, Hero Asahi India, Bharat Seats, Caparo Maruti, Denso India, Jay Bharat Group, Yamaha, Eicher Maruti, Krishna Maruti, Machino Plastics, Mark Auto Industries, Mark Exhaust Systems, Subros, Motherson Sumi, Minda Group, Gabriel India, GS Auto, Hi-Tech Gears, MAHLE Filter Systems India, Diesel Systems, Delphi-TVS Omaxe, Rico Auto
Hyundai, Mitsubishi, Toyota, Ford, Wheels India, Lucas TVS, Brakes India, Sundaram Clayton, Ashok Leyland, TVS, BMW Sundaram Fasteners, Sundaram Dynacast, Turbo Energy, India Nippon Electricals, TVS Cherry, Rane Group Rane Engine Valves, Rane Brake Linings, Ucal Fuel Systems, Tube Investments Tata Motors, Fiat, GM, Mahindra & Mahindra, Renault, Volkswagen Group (Audi, Skoda, Volkswagen), Ford Tata AutoComp, Bharat Forge, Bosch, Lear, Dana, Bridgestone, ZF, Victor Gaskets
West: Maharashtra (Mumbai, Pune, Nasik, Aurangabad) Gujarat (Sanand, Viramgam, Halol) Central: Madhya Pradesh (Pithampur, Indore)
Eicher, Mahindra & Mahindra, MAHLE Engine Hindustan Motors Bridgestone
Components,
East: West Bengal (Calcutta, Singur) Jharkhand (Jamshedpur)
Hindustan Motors, Tata Motors
Apex Auto, JMT Auto
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CHALLENGES FOR THE INDIAN SUPPLIER INDUSTRY

Components made in India are being increasingly accepted by global automakers and suppliers, helping the country carve its place as one of the most cost-effective sourcing destinations in Asia. The strong growth in sourcing has integrated the local suppliers with the global industry like never before. But greater integration has also exposed these suppliers to demand fluctuations in international markets. The evaporation of demand during and after the global economic slowdown of 2008 and 2009 is testimony to that fact. Still, the Indian supplier industry has witnessed volatility than other automotive markets, mainly because of a burgeoning domestic market thanks to the growing economy and less reliance on exports. However, sustaining high growth levels is not going to be easy for the Indian suppliers as they look to overcome local challenges such as high cost of funding, weak infrastructure and lack of skilled manpower as well as rising input costs and currency fluctuation.
DEMAND FLUCTUATIONS
Though the ongoing weakness in the market is cause for concern, suppliers are confident about their long-term prospects in India. Besides, the current decline is seen in passenger car and three-wheeler segments only. The two-wheeler, utility vehicle and commercial vehicle segments are still reporting encouraging growth numbers. Most Indian suppliers have a broad customer base, strong presence in the aftermarket and are engaged in exports. This has helped them counter the slowdown in the passenger car segment. Most of the suppliers that IHS SupplierBusiness interviewed for this report denied any slowdown in the Indian automotive industry. (In India) there is no recession as such. It is just less growth, so the growth has gone down, said Shalendra Bohra, Marketing Director of Bohra Rubber. He added, The industry cannot keep on growing all the time. There has to be some plateaux. So plateaux are the time when you need to concentrate and get ready for the next phases of growth. The suppliers are in fact using the current weakness in the market to analyse their performance during the expansion period as well as evaluating initiatives needed to prepare themselves for the next growth phase. Amit Mukherjee, Deputy Executive Director, ACMA, said, In the last one and half years the way the industry has grown we had no time to look back actually because everything was invested. It is now time to look back and know what happened, how much investment they (suppliers) have done, how much need to address.
CAPACITY EXPANSION
According to IHS Automotive, vehicle sales in India are expected to reach 7.7m units in 2020 compared with three million in 2010. This entails huge investments in capacity building by suppliers. According to ACMA Vision 2020, suppliers in India will need to invest INR160 (USD3.5bn) every year in capacity creation to meet demand, substantially higher than the current investment levels. Raising capital for such expansion is going to be
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tough considering the high borrowing costs India has seen a sharp increase in lending rates over the past couple of years owing to stubborn inflation. For local suppliers funds do not come easy. Commercial banks, which are a major source of funding in India, hesitate to lend money to local players, as the Indian supplier industry carries a high risk profile due to volatility attached with demand of end products vehicles. Generally, such loans come at a very high interest rate and with conditions attached. While major tier one suppliers can absorb a high cost of funding to a certain extent, it is the micro, small and medium enterprises (MSME) suppliers who bear the brunt. About 70% of our membership is small and medium enterprises. So the large tier one companies, they can negotiate, they can get 10% or maybe 8.5% to 10%. But the borrowing for small and medium enterprises becomes very challenging, said ACMAs Amit Mukherjee. In addition, bank loans generally require collateral and are not available on intangible investments. In particular, promoters of small tier two and tier three suppliers face fund crises in the absence of any external equity. ACMA is working with the Small Scale Industrial Bank of India (SIDBI) to provide lowcost funding to MSME. In September 2011, the bank introduced two schemes, Growth Capital and Equity Assistance for MSMEs (GEMS) and Flexible Assistance for Capital Expenditure (FACE). While GEMS provides equity or quasi-equity to the deserving MSMEs, FACE offers multiple repayment schedules. Under GEMS, the company will provide funds on the strength of cash flow rather than asset coverage or security. The initial longer moratorium of three to five years on principal instalments ensures greater chances of success of the ventures. Meanwhile FACE offers flexibility to plan capital expenditure for immovable and other fixed assets jointly or separately. The tenure of each component is linked with its economic life and cash flow and could be in the range of seven years for movable fixed assets and as long as 10 years for land and building. Meanwhile, the high cost of capital in India is driving some major suppliers to borrow from abroad. Amtek India, a subsidiary of Amtek Auto Group, has received an approval from its board to raise USD250m through external commercial borrowing (ECB) and debentures. Raising funds from international market has also become a more attractive option to Indian companies given the recent depreciation of the Indian rupee against the US dollar. Amtek Auto expects US dollar to remain strong for the greater part of 2012 making borrowing from abroad an ideal option. Although RBI may not increase interest rates further considering the falling inflation figures the current rates will take time to come down. The supplier industry expects the investment climate to improve significantly once interest rates normalise.
FLUCTUATING RAW MATERIALS PRICES

Volatility in raw material prices is a major concern for suppliers, irrespective of where there are based. Raw materials prices recorded strong growth during the recovery from the economic slowdown of 2008 and 2009. However, prices have moderated since the second half of 2011 amid growing concerns of global economy entering into yet another phase of
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slowdown mainly due to the debt crisis in Europe and cooling growth in emerging markets such as China and India. Figure 31: Raw Material Prices
Cold-rolled steel
USD per metric tonne
800 600 400 200 0 Jan-10 Jan-11 Jan-12 Oct-10 Oct-11 Jul-10 Jul-11 Apr-10 Apr-11
Aluminium
3,000.00 2,500.00 2,000.00 1,500.00 1,000.00 500.00 0.00 Jul-10 Apr-10 Jan-10 Jan-11 Apr-11 Jul-11 Jan-12 Jan-12
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1000
Oct-10
Source: World Bank
Source: International Monetary Fund
Copper
12,000 3,000
Lead
2,500 2,000 1,500 1,000 500 0 Jul-10 Apr-10 Jan-10 Jan-11 Apr-11 Oct-10 Jul-11 Oct-11
10,000 8,000 6,000 4,000 2,000

Mar-10 Mar-11 Jul-11 Jan-10 Jan-11 Sep-10 May-10 May-11 Sep-11 Nov-10 Nov-11 Jan-12 Jul-10
Rubber
300
Crude oil (Petrolium)

140 120 100 80 60 40 20 0 Jan-10 Jan-11 Jan-12 Oct-10 Apr-10 Apr-11 Oct-11 Jul-10 Jul-11
US cents per kg
200 150 100 50 0 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12
Source: Singapore Commodity Exchange (SICOM)
Source: US Energy Information Administration
USD per barrel
250
Oct-11
While the price of cold-rolled steel continues to remain high, aluminium, copper, lead, rubber and crude oil have somewhat cooled during the second half of the 2011. But, despite some moderation, prices continue to remain ballooning operating expenses for automakers and component suppliers. Tyre manufacturers are among the worst affected due to a sharp increase in the prices of raw materials such as natural rubber, synthetic rubber, steel cord and oil. To deal with the increasing cost of production, tyremakers in India and aboard are forced to increase tyre prices frequently. However, there is a limit up to which price could be increased without affecting its demand. Some are going for backward integration in order to reduce risks. In August 2011, Apollo Tyres took 10,000 hectares land on lease in Laos for rubber plantations. The company intends to secure one-third of its raw material requirement through backward integration. If it makes business sense to secure supplies through backward integration to feed our manufacturing units, we are game for the challenge. We realise this is a completely new business, with a long gestation period, open to multiple influences and requiring different skill sets from what we currently have in the organisation. However, given our growth plans, we feel this is the right time to venture into backward integration as a risk mitigation strategy, in an attempt to secure a percentage of our future supplies, said Neeraj Kanwa, Vice-Chairman, Apollo Tyres in an interview with IHS SupplierBusiness. Raw material importers have also been affected by the falling rupee. The slight fall in (raw materials) prices has taken place due to a slowdown in some parts of the world. This has also resulted in recent currency fluctuations. The weakening of the rupee brings with it yet another dimension. Over 60% of our raw materials are imported since they are not available in India, and whatever we might have gained from lower prices has been more than offset by currency fluctuations, said Apollos Neeraj Kanwar. While automakers can shift incremental cost partially or wholly to end-users (vehicle buyers), suppliers dont have the luxury of doing so. Suppliers do however rely on good relationships with OEMs in such scenarios. Many major suppliers that IHS SupplierBusiness spoke to for this report said automakers compensate them for high raw material costs. Generally, tier one suppliers enjoy higher bargaining power with OEMs. Shvetal Vakil, Executive Director, Setco Automotive, said, We have more or less an unwritten understanding that the OEM would compensate us for any increase in material costs. We are expected to show efficiency in our processes and systems to take care of any inflation pressure on other costs like manpower. If there is any, say 10% increase in material costs, the same would be compensated by the OEMs. Some suppliers told IHS Automotive that they passed on the gain to their customers when raw materials prices softened in the past. This cameraderie has fostered a strong relationship between OEMs and suppliers.
EXCHANGE RATE VOLATILITY

In 2011, the Indian rupee depreciated against major global currencies such as the euro (18.2%), US dollar (22.2%) and Japanese yen (32.3%). The sharp fall has impacted Indian suppliers who import raw materials or semi-finished components from overseas markets.
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Figure 32: Exchange Rate INR against USD (Jan-10 to Jan-12)

60 55 50 INR 45 40 35 30
Figure 33: Exchange Rate INR against EUR (Jan-10 to Jan-12)

75 70 INR 65 60 55 50
Figure 34: Exchange Rate INR against JPY (Jan-10 to Jan-12)

0.75 0.7 0.65 0.6 0.55 0.5 0.45 0.4 0.35 0.3
Source: Oanda Corporation

INR
While big suppliers hedge against such volatility, small suppliers often bleed due to a sharp rise in their cost of production. In January 2012, Maruti Suzuki came to the rescue of its suppliers through hedging imports of some 25 to 30 core vendors such as Suzuki Powertrain, Subros, Motherson Sumi and Denso Japan. These suppliers together import components worth INR50bn (USD91.2m) from Japan every year. The hedging will protect the automakers vendors from volatile movement in values of the yen against the Indian rupee. But the fall of the rupee is not bad news for suppliers who are active in the export market. A weak rupee makes Indian products more competitive in the international market; therefore the net impact of the rupee depreciation will be different for different suppliers, depending on their export-import mix. Besides, if the rupee continues to be weak, foreign automakers may find it more feasible to source components from the local market. This augurs well for the Indian supplier industry, as far as the trade deficit is concerned. However, a prolonged weakness of the Indian rupee will force the local component manufacturers who use imported raw materials to change their procurement strategy in order to remain competitive.
RISING OPERATING COSTS

Suppliers in India are also witnessing increased operating costs, which include power and employee expenses. Automakers generally insist that suppliers absorb these costs through improving efficiency but there is a limit up to which these incremental costs can be recovered through raising productivity. In India, power supply has not grown in line with demand due to strong growth in industrial development in some regions. In the absence of adequate supply, suppliers are left with no options but to buy additional power, which generally comes at higher costs, or invest in captive power plants, which again, is an expensive affair. In addition, high inflation has forced automakers and suppliers in the country to frequently adjust labour wages. Rajeev Mittal, Quality Head at Talbros, said in an interview with IHS SupplierBusiness, The prices have become very competitive; no OEM is ready to give more than the raw material increase, whereas labour and power costs are increasing. Today we are running generators to the extent of 10 to 12 hours which is adding to our costs which we are not able to recover. The cost of raw material is increasing; procurement costs are increasing which are not compensated by most of our OEMs. So margins are always under pressure. The strong rise in operating costs could hurt Indias manufacturing competitiveness and drive investment away to other low-cost countries in Asia such as Thailand, Vietnam and the Philippines.
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R&D CAPABILITIES
For new products and technology Indian suppliers still heavily rely on joint-ventures or technical alliances with international suppliers. Most Indian suppliers spend less than 1% of their total turnover on R&D. Even tier one suppliers are not investing in developing their R&D capability in a big way. Although some companies have begun investing in R&D, it is still confined to improving process rather than developing new products. Lately, some Indian suppliers have obtained R&D capabilities through acquiring foreign companies. For example, Motherson Sumis acquisition of Visiocorp in 2009 strengthened its presence in the rear view mirror segment, giving the company access to the acquired European suppliers technologies. Later in 2011, the company acquired the majority stake in Peguform which increased its new product development capabilities. Table 4: Indian Suppliers R&D Spend compared with Global Suppliers
Indian supplier Bharat Forge Exide Industries Motherson Sumi Apollo Tyres Subros Rico Auto Sona Koyo R&D expense (% of sales) 0.14% 0.20% 0.30% 0.36% 0.37% 0.31% 0.19% Global suppliers Bosch Denso Continental Bridgestone Aisin Seiki Johnson Controls Hyundai Mobis R&D expense (% of sales) 7.8% 9.3% 5.2% 2.3% 6.1% 2.1% 1.2%
Source: IHS Research, Suppliers Annual Reports 2010-11
The low enthusiasm for R&D among Indian suppliers stems from the fact that very little vehicle design and development work is currently being done in India. Except for a few local players, namely Tata Motors and Mahindra & Mahindra, most foreign automakers design and develop products in the international market. For example, Tata Motors spent 0.8% of its sales on R&D in financial year 2011, Mahindra & Mahindra spent 1.1% and Ashok Leyland 0.4%. The domestic market leader Maruti Suzuki spent 0.5% of 2011 sales on R&D during financial year 2011. This fails to inspire local suppliers to boost spending on R&D in the country. When a global automaker decides to commence production of a particular model in India, it looks for suppliers who can produce a given component at a competitive price. The local suppliers R&D activities are mainly confined to developing similar components for such models though technology sharing. Things are set to get tougher for Indian companies especially when global companies are increasingly investing in setting up technical centres in India. Bosch operates two development centres in India; one in Bangalore, Karnataka and the other in Coimbatore, Tamil Nadu, which is the largest outside Germany. Denso operates one R&D centre in
Gurgaon, Haryana. In 2010, the company established a design centre Noida, Uttar Pradesh, in collaboration with its strategic partner Subros. Global suppliers Continental, Cummins, Delphi, Faurecia, Magna, Valeo, Visteon and ZF also operate development centres in India. These technical centres by foreign suppliers mainly help their Indian subsidiaries in customising products to meet local requirement. Though automakers have been asking suppliers to invest in R&D, small suppliers find it difficult to garner funds to do so. ACMA is clearly worried. We have got to be competitive, let's not get excited because our top lines are growing...bottom lines are not growing in sync. At the moment we don't have enough technology. We are importing technology and asking the Japanese or Europeans to give us their technology. We need to create it ourselves, Said Arvind Kapur, President of ACMA. In February 2011, ACMA requested the government to approve INR75bn (USD1.75bn) for Technology Development and Upgradation Fund (TDUF) from 2012 to 2016. These funds are expected to help local suppliers modernise and upgrade their technologies and improve overall competitiveness. The government however is yet to act on this suggestion.
TRADE PRACTICES
In the past couple of years India has struck trade deals with countries such as Japan, South Korea, Malaysia, Thailand and associations such as ASEAN, SAARC and MERCOSUR. Currently India is negotiating a free trade agreement (FTA) with the European Union. Though such deals offer companies access to more markets, Indian suppliers reckon that pacts with regions where the component industry is more developed than Indias could result in increased imports of components into India by automakers and discourage local production. Indian suppliers are especially wary of countries where there is surplus capacity. In the absence of high tariffs, OEMs may prefer imports over local production, which will hurt Indian suppliers. Besides, Indian suppliers are less capable of retaliating by exporting products to more developed markets given the high quality requirements. FTAs and all that (PTAs and CEPA) are fine but there has to be a level playing field. We are struggling with interest rate changes, we are struggling with power, there are so many issues we are struggling with, inflation is so high, interest rates are so high. So, sometimes it becomes really difficult to be competitive, said Amit Mukherjee, ACMAs Deputy Executive Director. ACMA, however, is in favour of India entering into FTAs with Brazil and South Africa. On foreign trade, India should consider establishing FTAs with countries like Brazil, South Africa, etc. which already have a ready market for our products. said Arvind Kapoor, President ACMA and head of Rico Auto.
SKILLED MANPOWER SHORTAGE

The Indian automotive industry, including the supplier sector, is expected to face an acute shortage of skilled manpower in the coming years. According to SIAM, annual demand for skilled manpower for the Indian automotive industry is around two to 2.5 million people; this includes minimally skilled people who work on the shop floor. However, the current
supply does not exceed 1.5 million a year, with a maximum number supplied by Industrial Training Institutes (ITIs). In addition, there is a huge skill gap at all levels including workmen, supervisory, managerial and executives however, it is more glaring at the lowest level of the employment. In India, ITIs and polytechnic colleges impart vocational trainings to meet the requirements of various industries including automotive. However, the content and quality of training are not up to industry requirements. The key reasons for the skill gaps include outdated syllabi and poorly trained teaching faculties. The local industry is trying to deal with the shortage of skilled manpower by methods such as in-house training, partnership with engineering and polytechnic colleges. Some companies have even set up technical institutes within their plants. For instance Tata AutoComp began recruiting students passing out of class 12 into a three-year dual-system university diploma programme for which it has tied up with three technical institutes in Pune. The company has enrolled 2,100 students so far and wants to double this number as it takes the programme to Sanand (where the supplier plans to set up units to cater to Tata Motors Nano car) and Bangalore (where its new plants are starting operations). Lack of skilled manpower could become an obstacle for suppliers who are planning to invest in research and development capabilities. To address this SIAM, ACMA and the Federation of Automotive Dealers Association (FADA) have established an Automotive Skill Development Council (ASDC), with the support of the Ministry of Heavy Industries and funding by the National Skill Development Council (NSDC). The council is drawing up a curriculum for the automotive sector and will tie up with the institutes to provide requisite training.
GROWING COMPETITION
The high growth potential of the Indian automotive market is attracting global suppliers to invest in India. The past decade witnessed many global suppliers setting up manufacturing bases in the country. These suppliers have entered India to continue supplying to their global customers who are setting up manufacturing facilities in India. In addition, these suppliers are eying businesses from Indian companies. This is intensifying the competition between the local and the global suppliers, which is expected to increase in the coming years. Compared with foreign companies, most Indian suppliers are still at a nascent stage of development. The global suppliers being much older and experienced have developed strong product lines, international presence, customer base and new product development capabilities, something which local suppliers would find difficult to match. For instance, the worlds largest supplier Robert Bosch generated sales of EUR30bn (USD39bn) in 2011, 25 times more than the annual sales of Indias leading supplier Samvardhana Motherson Group. Besides, Bosch invests more than double the turnover of Indias leading supplier on R&D. The company has been investing in India to expand its foothold.
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Table 5: Presence of major global suppliers in India

Company Bosch Presence in India The biggest international supplier in India operates 14 manufacturing plants and three development centres. Setting up a new plant in Chennai, Tamil Nadu in collaboration with Igarashi Motor to manufacture engine cooling fan modules, wiper systems, HVAC blowers and widow lift drive products. Operates four manufacturing plants, one technical centre and one designing centre for car air-conditioning systems. The company is also a party to a three-party joint-venture company Subros, India's leading supplier of car air-conditioning systems. In addition, the company has an equity stake in Pricol, a major local supplier of instrument clusters. Operates six facilities, one technical centre. Acquired Modi Tyre to enter the Indian tyre market in 2011. Investing in ramping up the acquired companys facility to foray into radial tyre business. Operates five manufacturing plants, four engineering, product development and sales office. The companys subsidiary Cosma International is setting up a plant in Talegaon, Maharashtra to produce body and chassis solutions. Operates one manufacturing plant in Bangalore in Karnataka. Setting up two additional plants in the country, one in Rohtak, Haryana and another in Bangalore to produce components. Operates seven manufacturing plants Operates six manufacturing plants, one technical centre and one design centre Operates nine manufacturing plants, three R&D centres Operates five manufacturing plants Operates six manufacturing plants with its local joint-venture partner Rane Group and Sun Vacuum Formers Private Limited
Denso
Continental
Magna
Aisin Seki
ZF Faurecia Valeo BorgWarner TRW
The challenges for suppliers operating in India are very different from those suppliers which are facing in developed markets. Unlike in the western market, where suppliers are struggling to stay afloat amid flattening vehicle demand, most Indian suppliers are striving to match the growing demand from automakers. While suppliers devise their own strategies to deal with market challenges, they look to the government to offer them a conducive business environment through industry-friendly policies. The next chapter offers an insight into the existing policies of the Indian government which, directly or indirectly, affect the automotive industry.
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GOVERNMENT POLICY
Though the automotive sector was subjected to strict regulations in the past, over the years the role of the Indian government has changed from being a tough regulator to that of a facilitator. The governments contribution to the sector in the past 60 years could be broadly categorised into three phases. The first phase, which started after independence and continued through the early 1980s, was marked by severe government control over the automotive industry through various industrial and trade policies. The situation started changing in the 1980s when the government permitted partial deregulation, allowing foreign automakers and suppliers to enter India through joint-ventures (JVs) this marked the second phase which lasted nearly a decade. The third phase, which still continues, began in 1991 when India announced comprehensive economic reforms opening more doors for the automotive Industry to do business in India.
Phase 1: Draconian regulations during 1947-1980

During the first three decades after independence, the government not only controlled the production volume of vehicles but also prices. It also controlled the number of players that can operate in two-wheeler, three-wheeler, passenger car and commercial vehicle segments. For most of the time, government policies led to growth in one sector at the cost of another. The government used various policy tools to control demand and supply in the local automotive industry. It banned imports of vehicles in completely-built-unit (CBU) form and introduced licensing to regulate entry, diversification, expansion, foreign collaboration and imports of machinery and equipment. The focus was mainly on indigenisation, which to some extent helped the development of the local component industry. The period also saw greater focus on two-wheeler and commercial vehicle segments as preferred means of public transport with little emphasis on passenger cars.
Phase 2: Limited liberalisation during 1980-1990

In the 1980s, the government introduced relaxations for new entrants, foreign equity collaboration and import of machinery and technology. It allowed existing automakers to decide on their product-mix in order to better utilise their capacity. The government decided to promote vehicle and component exports by simplifying procedures and easing the process for licences to set up 100% export oriented units (EOUs). As a result, the 1980s saw entry of several Japanese automakers and suppliers into India through JVs Hero Honda, Escort Yamaha, Bajaj Kawasaki and TVS Suzuki in two-wheelers and Maruti Suzuki in the passenger car segment. Two of these JVs Maruti Suzuki and Hero-Honda are now leaders in their respective segments.
Phase 3: Economic reforms of 1991 and afterwards

In terms of liberalisation, 1991 was a watershed year for the Indian automotive sector. The government introduced major economic reforms drastically reducing the number of industries exclusively reserved for the public sector, and almost abolished industrial licensing except for a few hazardous and environmentally sensitive industries. The
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government also dropped the draconian Monopolies and Restrictive Trade Practices (MRTP) Act which required a company to seek separate clearance for expansion or diversification of business. The government replaced this law with a competition law discouraging anti-competitive business practices. In addition, the government curtailed the number of businesses exclusively reserved for small-scale industries. The government used to control investment and expansion of the reserved items to protect the small-scale sector. India introduced sector-specific guidelines where foreign direct investment (FDI), up to specified sectoral caps, was allowed under automatic routes. In other words, foreign companies could invest up to specific limits without any prior approval from Indias Foreign Investment Promotion Board (FIPB). Under the new policies foreign automakers and suppliers were allowed to own a 51% stake in their Indian subsidiaries. This triggered entry of automakers such as GM, Ford, Daewoo, Hyundai, Skoda and Toyota into India in the 1990s. The FDI limit under automatic approval was further raised to 100% in 2003. The second round of liberalisation resulted in the arrival of other major automakers such as Audi, BMW, Volkswagen, Renault-Nissan and most recently PSA Peugeot Citron. Besides fostering foreign participation, the government eased imports of capital goods and technologies to facilitate large-scale vehicle production in the country. In 1991, the government dropped the mandatory phased manufacturing programme introduced in the 1980s which required new companies to attain a 95% indigenisation within the first five years of production. This allowed foreign firms to start operations in India by assembling semi-knocked down (SKD) or completely knocked down (CKD) vehicle kits. However, the government introduced a regulation which required foreign firms to maintain foreign exchange neutrality. From 1997 onwards, new firms were required to sign a memorandum of understanding (MoU) with the Director General of Foreign Trade (DGFT) to import SKD/CKD kits. They had to sign export commitments and a plan for production in the country. However, in 2000, the government decided to do away with the foreign exchange neutrality requirement for SKD/CKD imports for new firms. One year later, the government put such imports, including of CBUs, under open general licence (OGL). In 2003, the government also dropped foreign exchange neutrality for existing units.
POLICY ENVIRONMENT
The government has formulated various policies which influence the growth of the local automotive industry. These include tax policy, industrial policy, trade policy and investment policy.
Tax policy
Recently, the government has used tax and subsidies to strengthen the automotive industry. For example, in the thick of the economic slowdown of 2008-09, India reduced the standard rate of central excise duty to 8% through two successive reductions in December 2008 and February 2009. This provided relief to the domestic manufacturing sector including automakers and component suppliers.
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Currently, India levies both direct and indirect taxes on its people and businesses. The direct tax includes income tax, wealth tax and corporate tax while indirect tax comprises customs duty, excise duty, central sales tax and service tax. The authority to levy taxes has been divided between the central and state governments. The central government levies direct taxes including income tax, wealth tax, corporate tax, and indirect taxes comprising customs duty, excise duty, central sales tax and service tax. The state governments impose professional tax, state sales tax, apart from other local taxes such as entry tax and octroi. India has successfully introduced major tax reforms in the country during the past decade, resulting in a sharp reduction in the number of slabs for a particular tax. This has simplified taxation and improved their administration. One such reform was a common value-added tax (VAT), introduced in 2005, which replaced excise duties imposed by both centre and states. Currently, the country has only two types of VAT, one imposed by central government (CENVAT), and the other by a state government. The government is currently working on introducing two major tax reforms uniform direct tax code (DTC) and common goods and service tax (GST) which could be termed as a watershed in the history of taxation in India.
Direct Tax Code: In August 2010, the government introduced a Direct Tax Code (DTC)
Bill in the Parliament to reform the way it imposes direct taxes. The Bill seeks to replace the archaic Income Tax Act, 1961 and aims to rationalise the tax rates, expand tax base and minimise exemptions. The Bill proposes to reduce corporate income tax from the current level of 34% to 30% including education cess and surcharge. The government originally aimed to make DTC effective from 1 April 2011 but later deferred it by a year. It is clear now that DTC cannot be implemented from 1 April 2012 either considering the Standing Committee of Financewhich was looking into the Billsubmitted the report only in the second week of March 2012. Besides, in the Union Budget for 2012-13presented in the Indian Parliament on 16 March 2012the government failed to offer a specific roadmap for quick implementation of DTC across the country. In a post-Budget interaction with industrialists, Indians Finance Minister said the Direct Taxes Code (DTC) legislation would be in place in 2012-13, but effect would be from next year (2013-14) onwards.
Goods and Service Tax: Indias plans to introduce a nationwide uniform GST is viewed
as the most important tax reform initiative after independence. Under GST the current regime of multiple indirect taxes will be replaced by a comprehensive dual GST across the country, one imposed by the central government and another by the states. This would abolish several indirect taxes including central sales tax, state-level sales tax, entry tax, stamp duty, turnover tax and octroi among many others. The tax base will be comprehensive, covering most of the goods and services, with minimum exemption. In the first year, two rates are proposed 12% for essential items and 20% for others. In the second year, the government intends to lower the upper tax rates to 18%. Ultimately, India aims to have a single rate of taxations split equally between the centre and states. Manufacturers will receive credits for tax paid earlier, which will eliminate multiple taxation on the same products or services. GST is based on destination principle. For inter-state transaction in India, the state GST would be applicable in the state of destination as opposed to state of origin, the principle
which has been followed so far. However, GST would not cover goods such as crude oil, diesel, petrol and alcohol which are major sources of revenues for most states. GST is expected to have a far-reaching impact on all aspect of business operating in the country including pricing of products and services, supply chain optimisation, information technology, accounting and tax compliance systems. India introduced a GST Constitution Amendment Bill in the Parliament during March 2011. The Bill has been referred to the Standing Committee of the Parliament which will make recommendations and send it back for voting in the Parliament. But there are bottlenecks. States fear that with GST they will lose their fiscal autonomy and thereby revenues. For this the central government is negotiating with the states to reach a consensus. The government is setting up an INR500bn (USD11bn) fund to compensate states for any financial losses due to a shift to a new GST regime. Finding a middle way may take time and the government might miss the deadline in April 2012, for the third time.
Union Budget for fiscal year 2012-13

The government introduced the Union Budget for the financial year 2012-13 on 16 March 2012. On the direct tax front, the government maintained corporate income tax at 30% announced in the previous years Budget. However, on the indirect tax front, the government announced several changes. The government announced an increase in central excise duty from 10% to 12% for the manufacturing sector, excluding non-petroleum products. This was applicable for the automotive industry including the auto component sector. However, the new Budget continued with the policy of imposing lower excise duty on lithium-ion batteries and other critical components required for hybrid and electric vehicles (HEVs). So far as the customs duty is concerned, the government maintained peak rate of basic customs duty at 10%. However, the government increased basic customs duty on imports of completely-built unit (CBU) vehicles, costing more than USD40,000 from 60% to 75%. Overall, the Budget received a mixed response from the automotive industry. The local industry association SIAM termed the Budget as good under current circumstances. S. Sandilya, President of the association said that under the current difficult economic environment, the Finance Minister has tried to balance the need for growth with fiscal compulsions.
Direct Taxes
Corporate income tax: In the 2012-13 Budget the government maintained corporate income tax rates at previous years level of 30%. However, the government announced certain measures to allow the corporate sector to have better access to low-cost funds. For example, the government reduced the rate of withholding tax on interest payments on external commercial borrowings (ECBs), for some infrastructures sectors, from 20% to 5% for three years. These sectors include airlines, power, road and bridges, ports and shipyards, affordable housings, fertilisers and dams. Dividend Distribution TAX (DDT): In the 2012-13 Budget, the government proposed to remove the cascading effect of Dividend Distribution Tax (DDT) in a multi-tier corporate structure. During 2011-12, the government had reduced tax on dividend received by Indian
parent companies from their foreign subsidiaries to 15% (plus surcharge and education cess) compared with the previous 30%. In the 2012-13 Budget, the government decided to extend this benefit for one more year, up to 31 March 2013. Minimum Alternate Tax: According to section 115 JA of the Income Tax Act, if a companys taxable income is less than a certain percentage of the booked profit, then by default that much of book profit will be considered as taxable income. However, the government extends credit to companies who pay Minimum Alternate Tax (MAT). Under such provision, companies can carry forward the amount paid as MAT as credit for 10 years and can be set off against any tax in future that is not under the MAT regime. For limited liability partnership (LLP) the government imposes similar tax known as Alternate Minimum Tax (AMT). Such LLP can also carry forward the amount paid as tax as credit for 10 years and used against any tax in future that is not under AMT regime. India introduced MAT in 1997-98. The rate was low for the first few years. However, the rate increased from 7.5% in 2001-02 to 18.5% in 2011-12. The government also proposed to levy AMT in respect of LLP at 18.5% of their adjusted total income. In addition, the government decided to withdraw MAT exemption available to those companies operating in special economic zones (SEZs). The government has decided to maintain the current rate of MAT/AMT for the financial year 2012-13. Incentives to boost R&D in automotive sector: In FY2011-12, the government increased weighted deduction from 175% to 200% for any sum paid to national laboratories or universities engaged in an approved scientific research programme. In the Union Budget 2012-13, the government decided to extend this incentive for a further five years.
Indirect Taxes
Central value-added tax: In Budget 2012-13, the government decided to increase excise duty, across the board, from 10% to 12%. Earlier in financial year 2008-09, the government had reduced excise duty from 14% to 8% to stimulate the manufacturing sector in light of the global economic slowdown. Later, the faster than expected recovery of the Indian economy allowed the government to increase the duty from 8% to 10% in 2010-11. A further hike in excise duty in 2012-13 was on expected lines, given Indias widening fiscal deficit figures. However, the increase in duty has come at a time when the automotive industry is witnessing lower growth due to negative factors such as high inflation, high interest rate and rising fuel prices. Excise duty on small cars, with length not exceeding 4,000mm and engine capacity under 1,200cc for petrol or CNG or LPG-driven cars and 1,500cc for diesel cars, was increased from 10% to 12%. For large cars and SUVs, with length more than 4,000mm, the government has maintained its two different slabs of excise duties for the financial year 2012-13. For the large petrol-driven vehicles with engine capacity under 1,200cc, excise duty has been increased from 22% to 24%, while for vehicles with engine capacity exceeding 1,200cc, the duty was raised to 27% compared with 22% plus INR15,000 (USD330) in the previous financial year. Similarly, for large diesel vehicles with engine capacity under 1,500cc, excise duty was increased from 22% to 24% while for those vehicles equipped with
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engine capacity exceeding 1,500cc, excise duty has been increased to 27% over 22% plus INR15,000 (USD300) a year ago. The local component manufacturers association ACMA said the excise duty hike will make vehicles costlier, further hurting their demand. "Enhancement of excise duty would adversely impact the prices of vehicles and in turn their consumption. This is of concern to the auto component sector as the sector grows in tandem with the vehicle industry," said Vinnie Mehta, Executive Director of ACMA. To promote hybrid and electric vehicles (HEVs), the government reduced excise duty on lithium-ion battery packs for such vehicles from 10% to 6% for financial year 2012-13. The government also reduced excise duty on specified parts of hybrid vehicles from 10% to 6%. In addition, the government has cut excise duty on replacement batteries for supply to EV manufacturers, who are registered with Indian Renewable Energy Development Agency Limited (IREDA) or any State Nodal Agency notified for the purpose by the Ministry of Renewable Energy for central finance assistance (CFA), from 10% to 6% until 31 March 2013. Customs duty: The government retained the peak rate of customs duty at 10% for the financial year 2012-13. However, it proposed increasing basic customs duty on imports of completely built units (CBUs) with FOB (free on board) value exceeding USD40,000 and with engine capacity of more than 3,000cc for petrol-run vehicles and more than 2,500cc for diesel-run vehicles from 60% to 75%. SIAM termed this move as a right step to encourage local manufacturing, value addition and employment. The local component industry however has expressed concerns over the customs duty hike on flat-rolled steel from 5% to 7.5%. ACMA believes that the incremental tax will impact the component sector which uses flat-rolled steel as raw material to produce sheet metal components. "Increase in customs duty on the 'flat-rolled' steel from 5% to 7.5% could unfavourably impact the auto component sector as this is one of the key input materials for the industry," Mehta added. The government removed the basic custom duties (BCD) on lithium-ion batteries and other parts to encourage hybrid and electric vehicles (HEVs). However, such imports will continue to attract an additional customs duty or countervailing duty (CVD), however, of 6% compared with the previous 10%. The new rate is applicable until 31 March 2013. Welcoming the government initiative, S. Sandilya, President of SIAM said, "The concessional import duty on specified parts of hybrid vehicles has been extended to lithiumion batteries and other parts of hybrid vehicles. This will help the industry achieve better cost efficiency" Table 6: Budget 2012-13: Highlight 2012-13
Direct Tax Corporate Income Tax Maintained corporate income tax at 30% (excluding surcharges and education cess). In Budget 2011-12 the government reduced surcharge for companies having turnover more than INR10m (USD220,280).
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Surcharge for such domestic companies was reduced from 7.5% to 5% and for the foreign companies from 2.5% to 2%. Dividend Distribution tax (DDT) Minimum Alternate Tax Alternate Minimum Tax (AMT) Maintained the reduced DDT of 15% (plus surcharge and education cess) compared with previous 30%, for one more year. (MAT)/ Maintained MAT/AMT of 18.5% announced in the previous Budget for one more year Indirect Tax Central excise duty was increased across the board from 10% to 12% Excise duty on small cars, with length not exceeding 4,000mm, and engine capacity under 1,200 cc in case of petrol/ LPG/CNG driven car, was increased from 10% to 12%. The government increased excise duty on small cars, measuring not more than 4,000mm and engine capacity not exceeding 1,500cc in case of diesel driven car from 10% to 12%. Excise duty on petrol driven large cars and SUVs measuring more than 4,000mm in length but engine capacity less than 1,200cc has been increased from 22% to 24%. Excise duty on petrol driven large cars and SUVs measuring more than 4,000mm and engine capacity more than 1,200cc is increased from 22% plus INR15,000 (USD330) to ad valorem duty of 27%. The government increased excise duty on large diesel vehicles measuring more than 4,000mm but engine capacity less than 1,500cc from 22% to 24%. Excise duty on diesel driven large cars and SUVs measuring more than 4,000mm in length and engine capacity more than 1,500cc is increased from 22% plus INR15,000 (USD330) to ad valorem duty of 27%. The government reduced excise duty on LED lamps as well as LEDs required for producing such lamps to 6% Excise duty on specified parts of hybrid vehicles was reduced from 10% to 6%. The government reduced excise duty on lithium-ion battery packs for hybrid and electric vehicles has been reduced from 10% to 6%. Excise duty on replacement batteries for supply to EV manufacturers, who are registered with IREDA or any State Nodal Agency notified for the purpose by the Ministry of Renewable Energy for central finance assistance (CFA), was reduced from 10% to 6% Peak rate of basic customs duty (BCD) was maintained at 10%. BCD on import of completely built units (CBUs) with value exceeding USD40,000 and with engine capacity more than 3,000cc for petrol-run vehicles and more than 2,500cc for diesel-run vehicles has been increased from 60% to 75%.
Central Excise Duty
Customs duty
BCD on import of lithium-ion batteries and other major components for hybrid and electric vehicles (HEVs) has been removed. However, the imports of such components will attract a reduced special additional duty of custom (SAD) of 6%. SAD is fully exempted on LEDs used for the production of LED lamps. BCD on import of flat rolled steel has been increased from 5% to 7.5%
Source: IHS Research, Ministry of Finance, Government of India
TRADE POLICY
In India, the pace of trade policy reform accelerated after the World Trade Organization (WTO) came into effect in 1995, of which the country is a member. The Indian government gradually abolished import licensing and removed quantities restriction (QR) on imports in 2001. In June 2000, the government also dropped its stringent Foreign Exchange Regulations Acts (FERA) and replaced it with a much-liberal Foreign Exchange Management Act (FEMA). To provide better access to foreign companies, India has been reducing tariff and non-tariff barriers. For example, basic customs duty on imports of most of the items fell from nearly 47% in 1990-91 to 10% in 2011-12. Besides, the government has been aggressively pursuing bilateral and multi-lateral agreements with other countries and regions through Free Trade Agreements (FTAs), Preferential Trade Agreements (PTAs), Comprehensive Economic Partnership Agreement (CEPA) and Comprehensive Economic Cooperation Agreements (CECAs). In the past few years, India has entered into CEPAs with Japan, South Korea, Malaysia and Singapore, PTAs with Afghanistan, South Asian Association for Regional Corporation (SAARC), MERCOSUR and Chile, CECA with Singapore, FTA with ASEAN, and Framework Agreement with Thailand. Currently, India is negotiating an FTA with the European Union (EU), its largest trading block. The negotiations, which began in June 2007, are believed to have reached advanced stages. The agreement is expected to cover about 90% of trade and services between the two parties. However, there are issues which need to be ironed out. The local automotive industry fears that any reduction in import duty on completely-built units (CBU) from the current rate of 60% would result in a sharp increase in exports of vehicle to India from Europe. The association is of the opinion that lower import duty will also pave the way for imports of small and entry-level sedans in India which would be detrimental to local manufacturing. In 2011, India exported 230,000 cars to Europe but imported 6,000 cars, mostly premium and luxury cars. SIAM is vehemently opposing the India-EU FTA. The industry association has written a letter to Prime Minister Manmohan Singh protesting the inclusion of the automobile sector in the negotiations. The association fears that India may give in to the mounting pressure from the EU to cut import duty which could impact local production. Tata Motors echoes
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SIAMs concerns saying the import duty reduction will hamper the growth of the Indian automotive industry. A spokesperson at Tata Motors said, The duty reduction should happen in general and not as part of an FTA with a particular country. Automakers from Japan, South Korea and the US are also concerned about India giving special preference to the EU FTA. Vehicle manufacturers such as Honda, Toyota, and Hyundai have demanded that Indias Commerce and Industry Ministry provide them with a similar facility by making requisite changes in the bilateral trade agreements with their countries. "If any change is made in the current duty structure for auto products under the India-EU FTA, a similar provision must also be made under the India-Japan FTA, said Janeshwar Sen, Senior Vice-President at Honda Siel Cars.
Major bilateral and multi-lateral trade agreements

In February 2011, India signed a CEPA with Japan where the two countries decided to eliminate import duties on 94% of their trade items over the next 10 years. Under the agreement, India will cut import duties on diesel engines from the 12.5% at present to 5% over the next six years and on gearboxes from 12.5% to 6.25% over the next eight years. In addition, India will gradually eliminate import duties on car mufflers, which currently draws tax of 10%, over the next 10 years. The agreement became effective in August 2011. In February 2011, India signed a CEPA with Malaysia. Under the agreement, some 76 Indian items and 140 Malaysia items will have more liberal commitments. The agreement is expected to promote exports of several goods, including two-wheelers and commercial vehicles, from India to Malaysia and other ASEAN countries. However, India continues to protect import of sensitive items in agriculture, fisheries, textiles, chemicals and automobiles without duty or significant cuts. The agreement became effective in July 2011. In August 2009, India signed an FTA with the ASEAN countries. The FTA became effective on 1 January 2010 with Malaysia, Singapore and Thailand, and the other ASEAN members are expected to become party to the agreement by 2016, after they complete their internal requirements. The FTA is currently limited to trade in goods while negotiations for a similar agreement for services are currently underway. The FTA proposes to cut tariffs on staggering 4,000 goods traded between India and ASEAN. In August 2009, India signed a CEPA with South Korea where the latter will remove the tariff on 90% of goods imported from India over 10 years. Similarly India will remove tariffs on 85% of imports from South Korea within the same period. In particular, South Korea will see tariff reduction of 1% in the automotive industry the countrys biggest trading sector over eight years from 12.5% in 2009. In June 2009, Indias PTA with MERCOSUR, a trading block with Argentina, Brazil, Paraguay and Uruguay, became effective. The PTA covers trade of 452 products between India and MERCOSUR. India is willing to expand its PTA with
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other countries in South America and has already signed one with Chile. In addition, the country is working to increase the number of products covered under the PTA. In October 2003, India signed a Framework Agreement for an FTA with Thailand. The two parties are expected to sign the agreement by July 2012. The two countries have already abolished duties on 82 items including a few automotive components such as lighting equipment, suspension and transmission parts under Early Harvest Scheme (EHS), launched in 2004. The FTA is expected to cover about 90% of goods traded between the two countries.
Though these trade agreements have given India greater access to international markets, they have also opened the Indian market to more competition. Benefits of such agreements could vary from industry to industry. For automakers, such agreements essentially provide greater market access to sell their produces. They also benefit from greater opportunities to source components from other low-cost countries. For example, many Japanese automakers already use their supply base in ASEAN for their local manufacturing facilities in India. However, the local supplier community has responded to such deals with some degree of caution. Domestic suppliers fear that the growing number of bilateral and multilateral agreements will expose them given that they are at the nascent stage of development compared with Japanese, South Korean and European suppliers who have developed strong product and R&D capability. The domestic suppliers believe that such agreements could result in reduction in import duty, which could lead to a sharp increase in auto parts imports from these countries as automakers may find value in importing rather than sourcing locally. Japanese automakers such as Toyota, Honda and Suzuki are already sourcing autocomponents from Thailand for their India operations. However, suppliers are in favour of India signing trade deals with countries that are at the same level of development as India and are not a threat to local production. For example, ACMA, the local component industry association, encourages the idea of India striking trade agreement with countries such as Brazil and South Africa. The thinking is that while pacts with such counties would give India access to new markets, the long geographical distance would ensure that the domestic production is not challenged. On foreign trade, India should consider establishing FTAs with countries like Brazil, South Africa, etc., who already have a ready market for our products. We also need to ensure that FTAs do not result in inverted duty structures and that they are not a disincentive to source or manufacture in India. Further, on the exports front, it is important that the government continues its scheme of export incentives, as many of our export contracts are long term in nature, said Arvind Kapur, President of ACMA in a press release. India has benefited from better access to global markets, which is evident from the sharp rise in vehicle and components exports. However, imports have also grown significantly in the same period widening the trade deficit. According to ACMA, India exported components worth USD5.2bn in 2010-11 compared with USD2.8bn in 2006-07, a rise if 85.7%. However, imports of components more than doubled to USD8.5bn compared with USD3.9bn in 2006-07 (see Figure 31).
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Discontinuation of DEPB scheme

In October 2011, India ended the Duty Entitlement Pass Book (DEPB) scheme despite pressure from the manufacturing sector. The incentive scheme was started in 1997 to encourage exports through tax refunds to exporters. It aimed to neutralise the incidence of basic and special customs duty on import content of export products by providing credit against the export products at specified rates. The auto component sector was one of the major beneficiaries of this scheme and had requested the government to continue the programme. In 2010-11, the revenue loss to exporters due to the discontinuation of DEPB was INR87bn (USD1.9bn), according to media reports. The government, however, has mitigated the impact on exporters to a certain extent as they can now claim benefit under a Duty Drawback Scheme (DDS). All 2,130 items, which were earlier in DEPB, have now been incorporated into a duty drawback scheme including exports of passenger cars. The drawback rates will be capped at 5.5% for many items. However, there are 340 items where even after reduction of the ad hoc rates (1% to 3%) from the existing DEPB rates, the recomputed rate works out to more than 5.5%.
State policies
The states in India have their own industrial policies. They offer incentives such as land, tax sops VAT and sales tax exemption and basic facilities such as power and water at subsidised rates to attract investment. The extent of these incentives depends on the size of the investment, the employment potential of the project and the negotiating power of a company. Investor-friendly stable policies, adequate infrastructure and availability of cheap labour have resulted in concentration of vehicle and auto parts manufacturers in states such as Haryana in the north, Tamil Nadu in the south and Maharashtra in the western part of the country. Other states such as Gujarat, Uttarakhand, Himachal Pradesh, Jharkhand, Karnataka, Rajasthan and Uttar Pradesh are striving to attract investments. Besides, the central government offers incentives to promote investments in hilly regions in the north and north-eastern parts of the country. These sops often include income tax holidays for a period ranging up to 10 years. Lately Uttarakhand and Himachal Pradesh have benefited from such incentives. Uttarakhand has emerged as a new automotive cluster in the country boasting the presence of automakers such as Ashok Leyland, Bajaj Auto, Hero MotoCorp and Tata Motors and several components suppliers. On the contrary, unstable policy environment can take a toll on investments. Maharashtra is a case in point. At the beginning of 2011, the local government issued a notification to change the VAT policy, where automakers are eligible for incentive for vehicles sold in Maharashtra and not elsewhere. This has sales by 15-20%. The entire automobile industry would be affected because of the new VAT policy issued by the government of Maharashtra and if the issues are not resolved, further expansion would be a concern, John Chacko, Managing Director of Volkswagen India, told Business Standard. The change in VAT refund policy of Maharashtra has severely affected cash flow of Mahindra & Mahindra, which has strong presence in the state. The automaker is considering looking outside Maharashtra for new investment. "It is not a comfortable situation and we are actively considering moving out from Maharashtra as we plan the next phase of expansion, Pawan Goenka told The Times of India. In 2011, the utility-vehicle maker announced an investment of INR18bn
(USD393m) in a new vehicle manufacturing plant and testing facility in Cheyyar, about 100km away from Chennai, Tamil Nadu. Rajeev Bajaj, Managing Director of Bajaj Auto warned that the Maharashtra governments adverse policy measures would lead to a flight of capital from the state. The two-wheeler major is miffed with the state governments failure to meet its commitment of refunding sales tax refunds of 15 months worth INR11bn (USD242.3m). The company claims to have lost INR1bn (USD22m) in interest and INR300m (USD6.6m) in other income because of the governments inability to fulfill its commitment. Bajaj told The Indian Express that his company is going to use up all its capacity in Chakan and Aurangabad soon and could be looking at expanding, but if this attitude continued, the automaker would look at states such as Gujarat to invest.
Labour laws
Increasing labour disputes in India have affected both automakers and suppliers, especially in the past couple of years. Lately workers have resorted to strikes for reasons such as wages, better facilities at shop floor and labour contracts. Strikes at local suppliers often distort manufacturing schedules of foreign automakers. For instance, in 2009, a strike at Rico Auto compelled GM and Ford to suspend vehicle production in North America. Some labour-related laws in India are more than 50 years old Trade Union Act (1926), Industrial Dispute Act (1947), Minimum Wages Act (1948) and Factories Act (1948). The current labour laws prohibit a company employing more than 100 employees to close operation and lay off workers without state governments permission. The rigidity in labour laws forces companies to resort to outsourcing and hiring workers on contract basis. The contract systems give companies greater flexibilities to hire and fire people. But there is a flipside. Continuing reliance on contract labours has resulted in a sharp increase in the number of temporary employees; in some cases it makes nearly three-quarters of the total workforce in a company. Temporary employees get less pay compared with permanent ones and they are also not entitled to many employment benefits. Considering their large number, these workers often put pressure on companies to increase pay and incentives, failing which they resort to strikes. The Indian manufacturing sector, including the automotive industry, is requesting the government to introduce changes in labour laws to improve manufacturing competitiveness. SIAM has been pushing for reforms in labour laws. Labour reform is high on the agenda of SIAM, said Pawan Goenka, a former President of SIAM, in July 2011. Goenka also disclosed that the association has been discussing labour reforms with the government but without any positive results. Goenka believes that the current labour laws need to change otherwise it will have a serious impact on the sector. He said that auto companies should be encouraged to have more permanent employees like in the US, where firms are allowed to lay off workers during a slowdown. SIAMs President S. Sandilya said, There is an urgent need to implement labour reforms in the country. The Centre and state governments should work towards it.
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However, trade unions believe that the present labour laws are not the problem but the unwillingness on the part of the automotive industry to adhere to such laws is. Most of the auto companies do not respect the Indian labour laws and formation of unions, which is the workers constitutional right, D.L. Sachdev, Secretary, All India Trade Union Congress (AITUC) told Business-Standard. Sachdev emphasised that the machineries to enforce labour laws are weak and need tightening.
Land Acquisitions
Acquiring land is a time-consuming process in India. However, barring a few cases, land acquisition has largely been smooth for the automotive industry. Still the industry supports changes in the land acquisition laws, which are more than 100 years old. Tata Motors land acquisition fiasco in West Bengal in 2008 is a perfect example why India needs significant and clear laws. The automaker was forced to shift the location of its factory, which is currently under construction for its small car Nano from West Bengal to Gujarat following massive protests by local communities. The government is trying to iron out the scratchy issues. In September 2011, the Indian government introduced the Land Acquisition, Rehabilitation and Resettlement Bill in the Lok Sabha, the upper house of the Parliament. The bill, which will replace Land Acquisition Act 1894, proposes a unified legislation for acquisition of land and adequate rehabilitation mechanism for all affected people. The bill suggests that private companies should provide for rehabilitation if they acquire land equal to or more than 100 acres in rural areas and 50 acres in urban areas.
Highlights of proposed Land Acquisition, Rehabilitation and Resettlement Bill 2011

Makes approval of 80% of land owners mandatory for acquiring land, except in instances where land is acquired for public purposes. Sharp increase in compensation to land owners four times the market value of land in rural areas and two times the market value in urban areas. Onus of providing compensation is on buyer; compensation needs to be paid within three months of acquisition. Compensation to displaced individuals is to be INR500,000 (USD10,050) a subsistence allowance of INR3,000 (USD60.3) has to be paid per month for a year and an annuity of INR2,000 (USD40.2) per family per month for 20 years; 20% profit on each transfer of land within 10 years to be shared with owners. Makes it mandatory to give 20% of the developed land to owners
The bill, however, has received negative feedback from the business fraternity. FICCI said the industry is finding it difficult to acquire land and the draft bill would make the process more difficult as it restricted opportunities for land owners to sell land. The association believes that proposed increase in compensation is very high and suggested that private companies be allowed to purchase land directly from land owners after paying market
based compensation. FICCI also believes that resettlement and rehabilitation are going to translate into huge cost and administrative burden for the industry. The association has asked for a cap on resettlement and rehabilitation costs at 30-40% of the land acquisition cost. Bharat Parekh, Chief, Strategic Sourcing at Tata Motors, told IHS SupplierBusiness, That (the new bill) will definitely impact the auto components industry to start with as they follow their OEM customers to minimise inventory, have JIT (just-in-time) delivery, and reduce their logistic costs. That will be followed by the OEMs. Out of the total project cost, land accounts for about 40-50%. We have gone into systems of creating vendor parks. It happened in Pantnagar, Uttarakhand and Sanand, Gujarat where we negotiated on behalf of our suppliers. We are doing it in Dharwad, Karnataka also where we are setting up a new LCV plant. We are trying to tackle the issue through that route so that vendors dont have to worry unnecessarily about the availability of the land and land is available to them at a very reasonable cost.
Policy on fuel pricing

India imports around 75% of its total crude oil requirement. The country has traditionally operated under Administered Pricing Mechanism (APM) for petroleum products, under which the government compensates oil marketing companies (OMC) for incurring any loss over assured return of 12% post tax on net worth. However, India is gradually moving away from the APM regime to one based on market demand and supply. In April 2002, India dismantled APM for petroleum products including petrol and diesel. However, it continued to regulate fuel prices and interfered in the market when prices moved sharply. In August 2010, the Indian government deregulated gasoline (petrol) prices, leaving it to be driven by market demand and supply mechanism. Diesel continues to be regulated as it has wider application than petrol and therefore is a politically sensitive commodity. The differential treatment of petrol and diesel has led to a wide gap in the prices of the two fuels over the past few years. This gap is pushing buyers to tilt towards diesel-powered vehicles. Media reports suggest about 70% of the new vehicles being sold in India currently are diesel vehicles. This has forced domestic and foreign automakers to expand their diesel vehicle line up. Demand for petrol-powered vehicle, as a corollary, is shrinking. But every cloud has a silver lining. The government is planning to decontrol diesel prices at least for the passenger vehicle segment, if not completely. Estimates show that even after such partial deregulation, diesel price for passenger vehicles may increase by 18-20% and thus it will continue to sell at a substantially lower price than petrol, which is about 60 to 70% more expensive than the former. Experts reckon freeing diesel prices for just one sector could cause administrative issues and result in hording and black marketing. We are not against dual diesel fuel pricing. The mechanism needs to be carefully defined so that it has the desired effect and cannot be misused, said Pawan Goenka, President of M&M, which manufactures only diesel cars and utility vehicles, told the Hindustan Times. SIAM has welcomed the governments intention to remove subsidy on diesel used by passenger cars considering it will ease sudden distortion in demand patterns. SIAM has always been advocating market-linked pricing of automotive fuels including diesel. Petrol
pricing is already market based and this move by the government may be the first step in moving towards full market pricing of diesel. However, the proposed scheme should include only diesel passenger cars for personal use. The commercial applications of diesel passenger vehicles should be exempted from dual pricing of diesel fuel as it would impact mobility for the masses, especially in the rural areas," the association said in a statement. According to government data, trucks account for 37% of total diesel consumption in India, buses 12%, passenger cars 15%, agriculture accounts for 12%, industry 10%, power generation 8% and railways consumes 6%. There was fear in the industry that the government may announce high excise duty on diesel vehicles during budget 2012-13. This had received strong protest from both SIAM and several automakers operating in India. SIAM even claimed that the automotive industry was holding INR30bn (USD600m) worth of investment due to the government lack of clarity over diesel fuel pricing. Automakers such as Mahindra & Mahindra, Hyundai, Maruti Suzuki and Toyota Kirloskar had held their investment plan till the government clarify its position. With no special mention of any additional duty on diesel vehicles, these automakers are expecting the current status quo to be maintained in coming months and their fore planning to go ahead with their investment plans. "There has been no mention of an additional tax on diesel vehicles or on the existing differential pricing of diesel in the Budget...I would therefore assume that diesel vehicles will not be treated any differently," said Pawan Goenka, President, Automotive and Farm Equipment at Mahindra & Mahindra told PTI. As far as M&M is concerned, whatever we have held back on increasing production capacity of diesel vehicles, we will be going ahead now, he added. Hyundai which had earlier dropped its plans to invest INR4bn (USD77.4m) in a new diesel plant in Chennai, Tamil Nadu, is now evaluating the option after the budget. "We have to weigh the pros and cons as there has been no mention of diesel tax in the Budget. Within two weeks we will be taking a decision on whether we should go ahead with our diesel plant or not," said a companys spokesperson.
Industry regulations
The automotive industry regulations in India are governed by the Ministry of Road Transport and Highways. In addition, Ministry of Environment and Forest and Ministry of Petroleum and Natural Gas also play major roles in policy formulation the automotive sector. The primary laws which govern automotive regulations in India are the Motor Vehicle Act 1988 (MVA) and Central Motor Vehicle Rules 1989 (CMVR). The Acts govern regulations in safety and emissions. The CMVR is responsible for formulating the rule that explains MVA in detail. The road transport ministry has set up two committees which advise it in areas such as safety and emissions standard. CMVR - Technical Standing Committee (CMVR-TSC): receives recommendations from other committees such as Automotive Industry Standards Committee (AISC) and Bureau of Indian Standards (BIS), and finalises/approves safety
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recommendations made by such committees. The CMVR-TSC committee has representatives from various ministries and industry associations. Standing Committee on Implementation of Emission Legislation: set up to look into norms for vehicle emissions. The committee discusses future emission norms and recommends norms for vehicles already on roads.
AISC, also established by the road transport ministry, reviews safety standards in India from time to time and makes recommendations. The AISC safety standards are formulated and prepared by a separate panel comprising representatives of various stakeholder associations. While preparing safety standards, the panel takes into account various considerations such as the status of technology, time frame required for implementation, necessity of a particular regulation in relation to the safety and emission issues, etc. The government has set up various agencies to test and certify vehicles based on safety and emissions related standards, as prescribed by the road transport ministry. These include: Automotive Research Association of India, Pune, Maharashtra) Vehicle Research & Development Establishment, Ahmednagar, Maharashtra) Central Farm Machinery Testing and Training Institute, Budni, Madhya Predesh) Indian Institute of Petroleum, Dehradun, Uttrakhand Central Institute of Road Transport, Pune, Maharashtra International Centre for Automotive Technology, Manesar, Haryana
Emission regulations: Indias emission norms are on a par with the European Union (EU). But India has been rather slow in adopting these standards compared with the western markets. For example, Bharat II norms which are equivalent to Euro II were implemented nationwide on 1 April 2005 while Bharat III was implemented across 11 cities. Bharat III regulations were then meant to be implemented nationwide from 1 April 2010, but the process was delayed by six months following a hold-up in the supply of high-quality fuel across the country. Meanwhile, Bharat IV rules were introduced on 1 April 2010 across 13 major cities: Delhi and National Capital Region (NCR), Mumbai, Kolkata, Chennai, Bangalore, Hyderabad, Ahmedabad, Pune, Surat, Kanpur, and Agra. By March 2012, the number of cities where Bharat IV was implemented had gone up to 20. The government is further working to extend Bharat IV to 50 cities by 2015. Fuel Economy Star Rating: Meanwhile, India is moving towards star ratings for fuel economy. The road transport ministry has reached a consensus with the Bureau of Energy Efficiency (BEE) and SIAM on this. BEE, which rated electrical appliances such as refrigerators, air-conditioners and washing machines in the country, will give star ratings (based on a five star scale, with five being the most efficient and one the least) to vehicles based on their fuel consumption. Recently BEE provided preliminary ratings of 330 models which are available in India based on their 2009-10 specifications. Of the total 330 models only 9.7% (32 models) received five star ratings from BEE, 15.8% (52 models) four star,
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31.8% (105 models) three star, 20.9% (69 models) two stars and 21.8% (72 models) single star. BEE is working on a star labelling programme in 2011-12, based on the kerb weight of the vehicle, which will be applicable until 2014-15. The labelling programme with be recalibrated in 2014-15 which will become effective beyond 2015-16. Initially these ratings are expected to be done voluntarily by automakers; but these standards will become mandatory for automakers later. This will require automakers to invest in new technology and manufacturing lines. BEE is planning to give automakers adequate time to redesign and retool to meet the standards. Therefore it is working on standards for vehicles for sale in 2015-16 and 2020-21. While the automotive industry could meet 2015-16 specification through fine tuning and optimisation of current design, meeting 2020-21 standards would require complete redesigning and retooling. In addition, BEE is also proposing that all automakers meet Corporate Average Fuel Consumption (CAFC) which is similar to Corporate Average Fleet Economy (CAFE) in the US. Each automaker would be required to ensure that CAFC of all vehicles sold by them in a year is less than that specified by the CAFC standard corresponding to the average vehicle weight sold by them in that year. Automakers in India voluntarily disclose fuel economy of their vehicles as certified by the Automotive Research Association of India (ARAI). In such cases, one more labelling programme could create confusion among manufacturers and buyers. Expressing the local associations view on the proposed fuel economy star rating, Vishnu Mathur, Director General SIAM, wrote in a letter to BEE, The Regulation will make Indian auto manufacturers more mature, and they will have to adopt a right product mix, lower the vehicle weights, and implement better technology to achieve the targets. He however cautioned that any further stringency from the proposed fuel economy norms may hamper the automobile industrys growth. The association stresses that to achieve reduction in fuel consumption there needs to be a holistic and integrated approach in areas of road infrastructure, good quality of road surfaces, better traffic management and driver training, among others. Safety Regulations: India is a member of the World Forum for Harmonization of Vehicle Regulation, which is also known a WP-29. It is necessary for all vehicles in India to have basic safety features, such as seat belts, rear-view mirrors and laminated safety glass for windshields. However, compared to developed countries India still has some catching-up to do in mandating fitment of advanced safety technologies such as airbags and anti-lock braking systems (ABS). India introduced the mandatory fitment of ABS for commercial vehicles carrying hazardous goods in October 2006, and tractor-trailer and buses with national permit and hilly terrain from October 2007. According to Bosch, about 75% of vehicle produced worldwide have ABS on board while in India only 25% of locally produced vehicles are equipped with the technology. Bosch acknowledges though that awareness regarding automotive safety is increasing among vehicle buyers in India. In January 2010, Bosch established a manufacturing plant in Chakan, near Pune in Maharashtra to manufacture ABS for passenger cars and light commercial vehicles.
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RECENT DEVELOPMENTS
Realising the potential of the automotive industry in terms of revenue and employment generation, the government has come up with various policies to promote growth of the industry, especially over the past decade.
Auto Policy 2002

This was Indias first comprehensive policy for the auto sector. It aimed to make the local industry globally competitive and a sourcing destination for auto components. The government allowed 100% FDI via direct route and dropped foreign exchange neutrality requirements. Besides, the government is promoting modernisation of the industry and facilitating indigenous design and R&D. It announced fiscal incentives for automakers and suppliers to promote R&D in the sector. The government is working to make India an international hub for manufacturing small cars and a key centre for manufacturing twowheelers and tractors. In addition, the government decided to promote alternate fuel vehicles through providing various long-term fiscal incentives.
Automotive Mission Plan 2006-16

In September 2006, India unveiled the Automotive Mission Plan 2006-2016. The plan reiterated the goal to turn India into a global hub for vehicles and components. The plan set goals to increase the turnover of Indian automotive industry to USD145bn and create additional employment to 25 million people by 2016. Overall, the plan expects the domestic automotive industry's contribution to the countrys GDP to double from 5% in 2006 to 10% over the next 10 years. India expects its auto sector to attract incremental investment of USD35-40bn over the next 10 years both from existing and new OEMs/suppliers which are entering India. To facilitate this, Indias government intends to play a key role in creating a favourable business environment and better infrastructure.
National Automotive Board

India is planning to set up a National Automotive Board (NAB) as a nodal agency for all policy and certification-related issues of the industry. The board will also frame guidelines on vehicle recalls, which have not been monitored properly in India so far. The board, which will replace National Automotive Testing and R&D Infrastructure Project (NATRiP), will act as a co-coordinating authority between all departments and bodies related to the automotive industry. Besides promoting R&D and improving skill sets, NAB will also help foster development of hybrids, EVs and alternative fuel technologies. NAB will have members from Indias Planning Commission and departments such as heavy industry, road transport and highways, science and technology, environment and forests. NATRiP was set up in order to upgrade the three existing automotive R&D/testing centres in India Vehicle Research & Development Establishment (VRDE) at Ahmednagar, Gujarat; Automotive Research Association of India (ARAI) at Pune, Maharashtra; and the International Centre for Automotive Technology (ICAT) at Manesar, Haryana. Besides upgrading these three centres, NATRiP is also responsible for establishing four additional
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testing centres in India, including Chennai in Tamil Nadu, Rae Bareilly in Uttar Pradesh, Indore in Madhya Pradesh and Silchar in Assam.
National Manufacturing Policy

In October 2011, India approved the National Manufacturing Policy (NMP), which aims to increase the contribution of the manufacturing sector to the country's GDP to 25% by 2022 from the 16% at present. The policy aims to create 100 million jobs over the next 10 years. Indias auto industry is one of the biggest contributors to the manufacturing sector. NMP proposes to set up National Investment Manufacturing Zones (NIMZs) which will be developed as greenfield industrial townships, benchmarked against the best manufacturing hub in the world. These zones will have at least 5,000 hectares each. Companies in these zones will enjoy single-window clearance, a liberal exit policy and fiscal incentives such as exemption from capital gain tax. In addition, the policy emphasises setting up a Manufacturing Industry Promotion Board (MIPB) to ensure better coordination between central and state governments. The policy also encourages Indian companies to develop indigenous technology through fiscal incentives and subsidies.
Government Initiatives on skills development

Currently India is among the most frugal manufacturing destinations, thanks to the availability of a large pool of low-cost, skilled labours. However this talent pool is depleting fast. To address this, India has set up a National Skill Development Council (NSDC) to develop the skills of the Indian workforce through training. The council, a first-of-its-kind public private partnership (PPP) in India, supports skill development by funding training programmes. The challenges for technology-intensive automotive industry are glaring. The industry faces both quantity and quality issues. According to SIAM, the Indian auto industry currently employs 13 million people. But to sustain growth, the industry will require an additional 35 million people by 2022. Good skilled manpower is drying up; while people are plentiful, talent is all skewed up. The IT industry has picked out the best talent, being a flamboyant industry. The automotive sector gets the next level of workers. The gap between demand and supply of skilled workers affects the pricing aspect of workers, said Anmol Jain, Senior Executive Director of Lumax Industries, told Autocar Professional. There are quality issues, too. According to a study by ICRA Management Consulting Services (IMaCS), done for NSDC, there are a number of skill gaps that exist in various sections of the value chain in the supply industry, OEMs and component manufacturers and in the sales, service and support functions. Besides, graduates from Industrial Training Institutes (ITIs), engineering colleges and other institutions are not readily employable in the automotive industry. Experts reckon there is a need to devise training programmes to meet the growing requirement of the automotive industry. Citing these challenges, SIAM, ACMA and the Federation of Automotive Dealers Association (FADA) decided to set up an Automotive Skill Development Council (ASDC) in January 2011. The ASDC is approved by the government and is funded by the NSDC and Ministry of Heavy Industries. The council is drawing up a curriculum for the automotive sector and will tie up with the institutes to provide the requisite training. ASDC is an independent society whose role is to create a curriculum and then engage with agencies for the delivery of this curriculum. The
first curriculum we will work on is that of machinists. Once the curriculum for machinists is developed, then under the agencies that are approved by National Skill Development Corporation (NSDC), we will take it forward to Industrial Training Institutes (ITI) and other training institutes that will go and deliver this curriculum for training purposes, Vinnie Mehta, Executive Director at ACMA, told Business-Standard. Commenting on the governments role M&Ms Pawan Goenka said at an annual SIAM convention in September 2011, Every year we witnessed new major initiatives which have been taken up jointly by the (automotive) industry and government. This augurs well for the future of the automotive industry based on mutual trust and understanding.
INFRASTRUCTURE DEVELOPMENT
India is mindful that the country needs reliable infrastructure to foster investment and economic growth. This reflects in the steady increase in budgetary allocation for the sector. In 2011-12, India raised its allocation for infrastructure by 23.3% to INR2.14trn (USD47.1bn) compared with INR1.73trn (USD38.2bn) in the previous financial year. Infrastructure growth will be a major focus for the government during the 12th Five-Year Plan (April 2012 to March 2017) which is commencing with the start of financial year 201213. The government is planning an investment of INR50trn (USD1,100bn) during the fiveyear period of the plan, representing an average INR10trn (USD220.3bn) investment in a financial year. However the government alone cannot meet such a huge investment requirement, owing to Indias fiscal imbalances. Therefore, the government is encouraging Public-Private Participation (PPP) models to attract investments. The government expects PPP to contribute about half of the total investment requirement during the 12th Five-Year Plan compared with 30% during the 11th Five-Year Plan.
Transportation
In the transportation sector, India is focusing on development of roads, sea and airports. Roads: In India about 85% of passenger traffic and 70% of freight traffic happen through roads. India claims to have a road network of 4.2 million kilometres, which is the second largest in the world.
Years 2000-01 2004-05 2005-06 2006-07 2007-08 Source: India Economic Survey 2010-11 Total length of roads (in 000kms) 3,373.5 3,929.4 4,003.9 4,140.5 4,236.4 Surfaced length of roads (in 000kms) 1,601.7 1,846.6 1,910.8 1,997.3 2,090.3
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Years 2000-01 2004-05 2005-06 2006-07 2007-08

Source: India Economic Survey 2011-12
Length of national highways (in 000kms) 57.7 65.6 66.6 66.7 66.8
Length of state highways (in 000kms) 132.1 144.4 148.1 152.2 154.4
India is developing its highways under the National Highway Development Programme (NHDP). National Highway Authority of India (NHAI) manages development and maintenance of national highways. Currently NHAI is monitoring various NHDP projects involving widening and upgrading of about 54,000km of roads involving investments of more than INR3,000bn (USD66bn). For rural areas, India launched Pradhan Mantri Gram Sadak Yojana (PMGSY) in 2000 to provide connectivity to villages. The programme involves construction of 146,185km of roads to provide connectivity to 66,802 habitations. All rural habitations with populations of 1,000 in plain and 500-1,000 in hill and tribal areas are expected to be connected under the scheme. The government has made a budgetary allotment of INR240bn (USD4.8bn) for PMGSY in 2012-13. In 2009, the central government launched an ambitious target of building 20kms of highway per day with an investment of USD70bn for the next three years. This means adding 7,300km every year which is not impossible but seems like a herculean task, given the pace of growth of highway in India after independence. And there are reasons to be pessimistic. India managed merely 53% of the target set in 2010-11. However the government hopes to achieve the target in the next three years. Major NHDP projects Phase-1 mainly involves widening (to four lanes) and upgrading of 7,498km of national highways. This primarily includes connecting four metropolitan cities namely Delhi, Mumbai, Chennai and Kolkata, covering length of 5,846km, also known as Golden Quadrilateral project. Connecting highways along North-South (NS) and East-West (EW) corridors covering 981 km and port connectivity projects covering 356km and other highway project covering 315kms. Phase II involves widening of NS-EW corridors which were not covered in the first phase covering a distance of 6,647km. Besides it also involves providing connectivity to major ports on east-west coasts of India and some other projects. Phase III involves upgrading of 12,109 km (mainly four laning) through BOT mode. Projects primarily involve stretches of national highways and connecting state capitals with NHDP projects Phase 1 and 2. Phase IV involves two-laning of 20,000km
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Phase V involves converting 6,500 km of four-lane national highways developed in phase I and II into six lanes. Of the total 6,500km proposed, about 5,700 km would be taken up in the GQ and the balance 800 km would be selected on the basis of predefined eligibility criteria. Phase VI involves developing 1,000km of expressway to be developed on a BOT basis. Phase VII involves development of 700km roads including ring roads, bypasses, grade separated intersection, flyovers and service roads are considered necessary for full utilisation of highway capacity as well as enhanced safety and efficiency.
Source: National Highway Authority of India
Ports: India has a coastline of 7,517kms spread over 13 states. The country has 13 major ports and 187 minor ports which account for about 90% of the countrys total trade in terms of volume and 70% in terms of value. Of this, the major ports account for about 72% of total cargo traffic. While major ports are managed by the union government, minor ports are administered by the states. With increasing global trade, cargo traffic is expected to see a huge growth in India. Cargo handled at Indian ports increased from 383.74 million tonnes in 2004-05 to 569.90 million tonne in 2010-11, a growth of 48.5%. This calls for major expansion of port infrastructure which requires huge investment. The government therefore is promoting privatisation of ports to improve efficiency, productivity and quality of services. Besides, India is working on a new Port Bill. The Bill is expected to help India transform major ports, which currently operate as trustees, into corporate entities. Figure 35: Cargo handled at major Indian ports from 2004-05 to 2010-11
600 500 In million tonnes 400 300 200 100 0 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11
Source: Ministry of Shipping, India

However, one factor which has undermined the growth is the congestion and the resultant slow evacuation of the cargo from the port. This is mainly due to a lack of adequate railroad connectivity to the ports, especially to minor ports. India needs to invest in rail-road connectivity to facilitate swift movement of cargo from hinterland to port and vice versa.
Power
Power generation in India has grown at a CAGR of 5.17% in the past 10 years. In 2010-11 the country recorded a 5.6% increase in power generation to 811.1 billion units (BU). However, power generation has not kept pace with demand. According to the Indias Planning Commission, to sustain a GDP growth rate of 9% per year, the demand of grid power in India will need to grow by 6% per annum to 1,200BU by the end of 12th Five-year Plan in March 2017. Although the 11th Five-year Plan had set a goal to generate 78.7GW of additional capacity for grid power, the Planning Commission believes that the actual figure will be somewhere around 62.3GW by March 2012. The shortfall has been mainly due to poor project implementation, shortage of power equipment and fuel, particularly coal. Meanwhile, more than 80,000MW of new power capacity is currently under construction. The 12th Five-year Plan aims to create additional capacity of 100GW. Considering the huge investment required, India has allowed 100% FDI in the power sector through the automatic route. This includes power generation (except through atomic energy), transmission distribution, power trading and other activities. Indias private sector is also increasing its stake in the sector. In 11th Five-year Plan, about 33% of the incremental power generation capacity is expected to come from the private sector. This share is expected to go up to 50% in the 12th Five-year Plan. Table 7: Annual Energy Generation
Year 2010-11 2009-10 2008-09 2007-08 2006-07 2005-06 2004-05 2003-03 2002-03 2001-02 Power (in billion units) 811.1 771.6 723.8 704.5 662.5 617.5 587.4 558.3 531.6 515.2 Y/Y growth (in %) 5.6 6.6 2.7 6.3 7.3 5.1 5.2 5.0 3.2 3.1
Source: Central Electricity Authority; Excludes generation from plants up to 25MW capacity
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Delhi-Mumbai Industrial Corridor: This ambitious project involves development of an industrial zone covering six states along the 1,483kms routes connecting Delhi to Mumbai at an investment of USD90bn with financial and technical aids from Japan. The six states covered along the corridor include Uttar Pradesh, National Capital Region (NCR) of Delhi, Haryana, Rajasthan, Gujarat and Maharashtra. Rajasthan and Gujarat covers the maximum area and together account for 77% of total length of freight corridor. The corridor will have nine mega industrial zones of about 200-250 km2, high-speed freight line, three ports and six airports, a six-lane intersection-free expressway connecting Delhi and Mumbai and a 4,000 power plant. It envisages high speed connectivity for high-axle loaded wagon (25 tons) of double stacked container trains supported by high power locomotives. The corridor will have terminals at Dadri in NCR and Jawaharlal Nehru Port near Mumbai. Several industrial clusters are expected to develop alongside the DMIC corridor. In September 2011, the central government approved assistance of INR185bn (USD3.7bn) spread over a period of five years.
INDIAS COMPETITIVENESS IN TERM OF INFRASTRUCTURE IN BRICS COUNTRIES

While India has improved the overall quality of infrastructure in the past two decades, other emerging countries are also investing in this critical area. For example, regarding the quality of road infrastructure, India is still behind countries such as Brazil and Russia. In terms of quality of overall infrastructure, the World Economic Forum-Global Competitive Index (WEF-GCI) 2011-12 ranks India in 86th place among 142 countries, compared with South Africa (46th), China (69th), Russia (100th) and Brazil (104th). South Africa, with the best ranking among the BRIC countries, scores better than India in all areas except quality of rail road infrastructure. China, which is Indias closest rival, scores high in all respects whether in terms of quality of roads, railroad networks, ports or electric supply. Figure 36: Indian ranks third in terms of infrastructure among BRIC countries
Quality of overall infrastructure Quality of electricty supply Quality of ports Quality of rail road Quality of roads 0 20 40 60 80 100 120 140
South Africa China India Russia Brazil
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Source: World Economic Forum, Global Competitiveness Index 2011-12
The next chapter provides a detailed analysis of a survey on the Indian automotive industry which IHS SupplierBusiness carried out during the fourth quarter of 2011 for this industry report. The survey is basically divided into two parts, with the first one related to the various macroeconomic factors currently impacting the Indian automotive industry. The industrys executives were requested to rate various challenges such as high inflation, high interest rates, rising fuel prices, government policy changes and infrastructure bottlenecks among others to figure out which are the most critical challenges which require immediate attention. In the second part of the survey, the industry executives were asked to rate their relationships with automakers on various parameters, including payments, return on investment and finalisation of contracts. The results of this survey provided an insight of the OEM-Suppliers in India. The next chapter provides an analysis of a survey on the Indian automotive industry which IHS SupplierBusiness conducted during the fourth quarter of 2011 for this report. The survey is divided into two parts, with the first one related to the various macroeconomic factors currently impacting the Indian automotive industry. Under the survey senior industry executives were requested to rate various challenges such as high inflation, high interest rates, rising fuel prices, government policy changes and infrastructure bottlenecks, to figure out which challenges require immediate attention. In the second part of the survey, the executives were asked to rate their relationships with automakers on various parameters, including payments, return on investment and finalisation of contracts.
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SURVEY OF INDIAN SUPPLIER INDUSTRY

In late 2011, IHS SupplierBusiness conducted a survey among more than 70 senior industry executives mostly tier one suppliers to seek their perspective on a wide range of factors affecting the Indian automotive industry. The survey included questions on macroeconomic issues such as government policy, inflation and interest rates to operating issues such as raising capital, gaining technology and growing labour unrest. One of the key findings of the survey is that despite the current slowdown in demand, the majority of suppliers expect Indias automotive sector to grow at 10-20% over the next five years. Interestingly, only 11% of the suppliers surveyed see the market growing below 10% in the same period. The industry is sanguine about future growth as more foreign automakers set up base in the country and existing players expand their foothold. However, suppliers view stubborn inflation, high interest rates and inadequate infrastructure as the biggest bottlenecks in the road to high growth. Further, with rising investment in capacity expansion, suppliers consider availability of skilled workforce a major cause for concern. In terms of OEMs, the survey indicates that apart from Maruti Suzuki, Volkswagen is fast emerging as a preferred customer for suppliers. The German automaker also ranks high in terms of quality and investment expectations from its suppliers. But in terms of ease of contract negotiations and faster payment cycle, the survey reveals that Hyundai has an edge over the majority of the automakers in the Indian market. Ford and Toyota rank high in terms of return on investment they offer suppliers. Heres a snapshot of the survey. Figure 37: Survey More than 60% of suppliers expect Indias automotive market to grow at 1020% over the next five years
Above 40% increase 2%
30-40% increase 5%
Below 10% increase 11%
20-30% increase 18%
10-20% increase 64%
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Figure 38: Survey High inflation and interest rates very important challenges for suppliers
100% 90% 80% 70% % Respondents* 60% 50% 40% 30% 20% 10% 0% 28.3% 24.5% 16.3% 16.3% 4.1% 15.7% 23.1% 15.7% 7.8% 2.0% 13.5% 20.0% 9.4% 5.7% 18.9% 13.2% 26.5% 5.8% 9.6% 23.1% 41.2% 25% 14.5% 12.7% 14.5% 13.8% 12.1% 12.7% 29.3% 25.5% 17.2% 8.6% 19.0% Most Important Very Important Important Fairly Important Slightly Important Least Important
24.5% 12.2%
17.6%
*of those who expressed an opinion
Suppliers consider lack of adequate infrastructure in the country as the most crucial threat to the auto sectors growth. Nearly 30% of the respondents indicated infrastructure as the toughest challenge. While automotive demand has been on a growth track, transportation infrastructure has lagged behind apart from a few major cities, the majority of the places face poor connectivity and inadequate public transportation issues. The continuing rise in fuel prices is the second toughest challenge according to 24.5% of the suppliers.
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Figure 39: Survey Retaining talent most challenging issue for suppliers
100% 90% 80% 70% % Respondents* 60% 50% 40% 30% 20% 10% 0% 14.0% 14.0% 9.3% Winning new business 30.2% 19.0% 14.3% 21.4% 17.5% 20.0% 15.0% 20.5% 12.8% 19.1% 12.8% 11.4% 6.4% Retaining talent Internal supply issues *of those who expressed an opinion 11.6% 20.9% 14.3% 19.0% 11.9% 20.0% 12.5% 25% 15.0% 25.5% 18.4% 10.2% 14.3% 22.4% 6.8% 13.6% 23.4% 24.5% Most Challenging Very Challenging Challenging Fairly Challenging Slightly Challenging Least Challenging 10.2%
22.7%
Growing Developing Raising labour unrest new capital for investments technologies
Growing labour unrest and frequent strikes also add to the manpower challenges faced by the suppliers. Further, 21% of the respondents say that securing new contracts to grow business and development of new technologies are the next important challenges for them. Apart from workforce issues, logistics and management of internal supplies and inventories also affect the suppliers.
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Figure 40: Survey Volatility in OEM demand, input costs fluctuation weigh heavy on suppliers minds
100% 90% 80% 70% % Respondents* 60% 50% 40% 30% 20% 10% 0% 11.4% 9.1% 9.1% 22.2% 23.8% 10.6% 4.3% 15.9% 13.6% 15.6% 28.6% 23.4% 26.7% 29.8% 40.9% 23.8% 24.4% 2.4% 14.3% 12.8% 19.1% 15.6% 15.6% 13.3% 13.3% 65.3% 40.0% 2.0% 8.2% 8.2% 4.1% 12.2% Most Challenging Very Challenging Challenging Fairly Challenging Slightly Challenging Least Challenging
8.9% 7.1% 2.2% 2.2% Natural Volatility in Fluctuating Threat from Volatility in External OEM demand input costs competitors forex supply-chain disasters issues *of those who expressed an opinion
Nearly 41% respondents are of the opinion that fluctuation in demands from OEMs especially in an unfavourable macroeconomic environment is the most challenging uncertainty they face. Fluctuating raw material prices (steel, other metals and rubber) also emerged as an important external factor affecting suppliers. Further, growing competition due to the fragmented nature of the market, especially at the tier 2 and tier 3 levels, and effective management of supply chain and logistics (affected by infrastructure issues) are crucial factors affecting suppliers growth. Interestingly, despite the recent calamities in Japan and Thailand, the majority of the respondents (65.3%) feel that the threat from natural disasters, in comparison with other external factors, is very low.
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Figure 41: Survey Maruti Suzuki, Volkswagen most attractive OEMs among suppliers
100% 90% 80% 70% 60% % Respondents* 50% 40% 30% 20% 10% 0% 22.2% 2.8% 5.6% 25.0% 19.4% 40.5% 28.6% 19.4% 5.6% 41.2% 30.6% 5.6% 2.8% 33.3% 44.4% 24.3% 22.2% 21.6% 11.4%
17.6% 20.6% 16.7% 35.3% 44.4%
22.2%
37.1% 20.6% 47.1% 44.4% 29.4%
22.2% Very Attractive 27.8% 22.2% 11.1% 29.4% 2.9% 2.9% 22.2% 5.6% 0.0% 22.2% Attractive Moderately Attractive Unattractive Very Unattractive
8.1% 5.4%
14.3% 14.7% 8.6% 5.9%
23.5% 2.9% 5.9%
In the survey, Maruti-Suzuki and Volkswagen emerged as the most favoured OEMs for the suppliers, with 44.4% of respondents listing them as very attractive automakers in the Indian market. The growing prominence of the German automaker reflects the strategy of Indian suppliers to build relations with foreign OEMs to reduce their dependence on Indian automakers. Toyota, Hyundai, Ford and Tata Motors also rank high in terms of their attractiveness among suppliers.
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Figure 42: Survey Toyota, Volkswagen and Honda most exacting about testing and validation of components
100% 90% 80% 70% 60% % Respondents* 50% 40% 30% 20% 10% 0% 15.6% 34.4% 22.6% 31.3% 33.3% 21.2% 9.7% 3.1% 3.3% 6.1% 21.2% 3.0% 6.1% 3.0% 0.0% 6.3% 48.5% 37.5% 25.0% 12.5% 0.0% 3.1% 3.1% 12.5 31.3% 51.6% 43.8% 30.0% 54.5% 45.5% 25.0% 18.8% 16.1% 9.4% 12.5% 10.0% 23.3%
18.2%
30.3%
42.4% 56.3% 68.8%
50.0% Very High High Moderate Low Very Low
The majority of the respondents rated Volkswagen (68.8%) and Toyota (56.3%) as automakers that are very stringent about component quality checks. As a result of strict international demands, Indian suppliers are focusing more on investments in total quality management (TQM). However, when it comes to Indian automakers such as Tata Motors and Mahindra & Mahindra, most respondents think their demands for stringent quality checks are moderate.
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Figure 43: Survey Maruti Suzuki, Volkswagen and Toyota rank high on demanding supplier expansion
100% 90% 80% 70% 60% % Respondents* 50% 40% 30% 20% 10% 0% 3.4% 6.9% 6.9% 27.6% 37.9% 16.7% 3.3% 48.3% 51.7% 41.4% 43.3% 43.3% 44.8% 34.5% 33.3% 6.9% 41.4% 27.6% 20.7% 17.2% 10.3% 10.0% 10.3% 27.6% 37.9% 37.9% 51.9%
16.7%
14.8%
22.2% 11.1% Very High High 66.7% Moderate Low Very Low
27.6%
31.0% 30.0% 36.7%
Although the survey shows that almost all major automakers in India insist their suppliers invest in increasing production capacity and handling logistics, most of the respondents think Maruti Suzuki, Volkswagen, Toyota and Hyundai are more particular about asking their suppliers to expand.
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Figure 44: Survey Hyundai ranks high on contract finalisation with suppliers
100% 90% 80% 70% 60% % Respondents* 50% 40% 30% 20% 10% 0% 24.1% 29.6% 10.7% 14.3% 27.6% 25.9% 50.0% 46.4% 33.3% 36.7% 3.4% 3.4% 3.7% 3.7% 3.6% 7.1% 3.6% 7.1% 6.7% 10.0% 43.3% 28.6% More Than 24 Months 24.1% 35.7% 50.0% 18-24 Months 12-18 Months 28.6% 27.6% 14.3% 25.0% 0.0% 6-12 Months 0-6 Months 3.3% 3.3% 0.0% 28.6% 0.0% 0.0% 0.0% 25.0%
34.5% 32.1%
41.4% 37.0% 28.6% 28.6%
30.0%
20.0%
13.3% 14.3% 13.8% 17.9%
Hyundai ranks high in terms of ease of contract finalisation, the survey showed. Almost 30% of the respondents are of the opinion that contract negotiations with the South Korean automaker take between zero to six months. Further, Indian automakers Tata Motors and Mahindra & Mahindra a at 50% and 46.4% respectively score higher than other OEMs in negotiating contracts in 6-12 months.
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Figure 45: Survey Maruti Suzuki, Hyundai quicker with supplier payments
100% 90% 80% 70% 60% % Respondents* 50% 40% 30% 20% 10% 0% 0.0% 0.0% 0.0% 0.0% 0.0% 3.8% 0.0% 0.0% 0.0% 0.0% 10.7% 7.4% 11.5% 7.7% 11.1% 7.7% 17.9% 13.0% 16.7% 7.1% 18.5% 33.3% 11.5% 13.0% 8.3% 30.8% 22.2% 19.2% 10.7% 17.9% 0.0% 22.2% 38.5% 34.8% 37.5% 38.5% 39.3% 37.0% 38.5% 64.3% 51.9% 38.5% 23.1% 29.6% 30.8% 32.1% 39.1% 37.5% 66.7%
More than 120 days 90-120 days 60-90 days 45-60 days Less than 45 days
Maruti Suzuki emerged as the most favourable automaker in terms of supplier payment cycle, with 64.3% of the respondents indicating that payments are largely received within 45 days. Maruti Suzuki is closely followed by Hyundai at 51.9%, indicating that the South Korean OEM ranks high among suppliers both in terms of ease of contract negotiations and payments. The survey showed that a majority of the OEMs, including Tata Motors, Mahindra & Mahindra, GM, Ford and Honda, have an average payment cycle of between 45 and 60 days.
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Figure 46: Survey All OEMs good in terms of payment terms negotiation with suppliers
100% 90% 80% 70% 60% % Respondents* 50% 40% 30% 20% 10% 0% 14.3% 11.5% 7.1% 7.7% 19.2% 19.2% 7.7% 14.3% 15.4% 11.5% 11.5% 11.5% 12.5% 14.3% 7.7% 3.8% 3.8% 3.8% 3.8% 4.2% 50.0% 57.7% 53.8% 61.5% 61.5% 53.8% 53.8% 53.8% 54.2% 57.1% Outstanding Very Good Good Unsatisfactory Highly Unsatisfactory 3.8% 0.0% 0.0% 3.8% 3.8% 4.2% 0.0% 14.3% 7.7% 19.2% 17.9% 19.2% 15.4% 30.8% 26.9% 26.9% 25.0% 10.7% 3.8% 3.8%
In the context of payment terms negotiated with the suppliers, almost all automakers are considered good by the respondents of this survey. Mahindra & Mahindra and GM ranked high in terms of payment conditions as 61.5% respondents rated the automakers as good. At the same time, Maruti Suzuki scored a high of 17.9% in terms of outstanding payment terms (favourable for suppliers).
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Figure 47: Survey Ford, Toyota rank high on return on investment they offer suppliers
100% 90% 80% 70% 60% % Respondents* 50% 40% 30% 20% 10% 0% 26.7% 21.4% 17.9% 16.7% 34.5% 17.2% 40.0% 50.0% 42.9% 50.0% 41.4% 10.0% 13.3% 0.0% 3.6% 0.0% 3.4% 0.0% 31.0% 3.3% 16.7% 3.4% 11.1% 0.0%
21.4% 17.9% 16.7% 13.8%
27.6% 14.8% 33.3% Excellent
34.5% 56.7% 44.8% 55.6% 33.3%
Very Good Good Little Very Little
16.7% 13.8% 11.1% 33.3% 17.9% 16.7% 13.8% 10.3% 6.7% 10.3% 7.4% 10.0% 7.1% 0.0%
Despite stringent component quality expectations, Volkswagen was rated excellent by 11.1% respondents in terms of return on investment or profitability opportunities provided to the suppliers. Maruti Suzuki ranked second best with 10% of the respondents rating it excellent. Almost 18% of the respondents felt that profitability opportunities arising from business with Tata Motors and Mahindra & Mahindra are very little.
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INTERVIEWS
AUTOMAKERS
Michael Boneham, Managing Director and Sandeep Sanyal, Executive Director, Operations; Ford Motor India Rahul Bharti, Head, Corporate Planning & Investor Relations, Maruti Suzuki Bharat Parekh, Chief, Strategic Sourcing, Tata Motors
SUPPLIERS
Neeraj Kanwar, Vice Chairman, Apollo Tyres Shvetal Vakil, Executive Director, Setco Automotive J Sivkumar, Pricol Shailandra Bohra, Marketing Director, Bohra Rubber Amit Mukherjee, Deputy Executive Director, ACMA
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MICHAEL BONEHAM, MANAGING DIRECTOR AND SANDEEP SANYAL, EXECUTIVE DIRECTOR, OPERATIONS; FORD MOTOR INDIA
IHS: What has been the impact of the policy changes and macroeconomic factors on Ford in recent years? Michael Boneham: The policy changes are complementary to what else is going on in the industry which is significant growth. The key for us is to find the growth curve and support that growth from an [original equipment manufacturer] OEM perspective, and being able to support the supplier base as well in terms of the growth projections. Previously we were an interesting niche player and now we are more a major player particularly with the volumes increasing so much. For us, the environment is still quite challenging because of the interest rates and fuel-price hikes and the global issues which are creating some uncertainty in the market. From an OEM perspective, the last four years have been big growth for us because of the launch of Figo. But there were challenges too, as we had to ask our supplier base to step up significantly from where they were previously to support that level of growth. Rather than the policy issues impacting us so much, it has been more about the necessity of business and growth, how do we make sure that we are positioned to handle the growth ourselves . But then if you look at the value chain, making sure that the supplier base is positioned equally well to support the growth has been a challenge. It is very important here in India, because you have to have at least 80-85% of localisation to be successful in the segment where most of the vehicles are sold. It is the small car segment where 70% of the vehicles are sold. So if you have 80-85% of localisation, there will be a combination of suppliers we have traditionally done business with. We have been the longest serving MNC in India since the time government opened its legislative barriers, we were first MNC to come in, but we have had relatively small volumes. In the last 15 to 18 months, we have quadrupled our volumes. But that has presented a lot of challenges for us and the supply base because of the growth levels. So, we have grown almost 300% and the industry is growing at between 25% and 30%. It is important how the supply base and OEM maintain output at these growth levels and also maintain quality. With Figo being an export vehicle, it is important to ensure that quality levels meet the expectations of not just Indian customers, but also internationally it has to be globally competitive. So, for us the environment has been about how to position ourselves and prepare ourselves for growth and about how we get the supply base to support that growth in a very challenging environment. IHS: How has the investment scenario been with suppliers in the recent past? What are the challenges for the future? Michael Boneham: There are different categories of suppliers, from family owned to [jointventure] JV partners to global suppliers. Each of them brings opportunities but at the same time have their own set of challenges. For example, family-owned suppliers have been following the demand in terms of investment declared by OEMs rather than investing upfront in their own businesses. The Indian environment has been very dynamic. We have an industry that has moved this quickly between 2008 and 2010; it added one million units
and people [suppliers] struggled because they did not have the infrastructure [to increase production capacity]. While there was growth, in the middle of that phase came the global financial crisis, which also created further challenges and forced suppliers to make huge adjustments to their inventories and businesses. India came out of that very quickly but since then the suppliers have been playing catch-up to make the supply meet demand. This year the situation is a little different and there is a short-term slowdown but that has given everyone a bit of time to catch their breath. However the future is promising and India is poised to grow significantly as the automotive industry is expected to go from the three million now to about nine million in 2020. So for me, the biggest challenge is not now, but how we get the supplier base interested and aggressively going after investing upfront to be able to support that level of growth to meet the future demands. IHS: Talking about the supplier development, is Ford doing anything on this front? Sandeep Sanyal: Ford has formed a supplier technical assistance (STA) group as part of its purchasing operations, to work along with suppliers. STA aims to ensure supplier developments in terms of capacity as well as quality to meet Fords programme timing and quality requirement. Many suppliers, particularly Indian ones, find it a unique development experience covering various stages of a project including parts development, capacity process and all kind of other assistance. Michael Boneham: We fund the tooling at suppliers, as part of our global policy. We ask them to put the equipment in, and we put the tools in. They need to invest in further equipment to support the growth. From a risk perspective, it is beneficial for suppliers. We have STA people domiciled in the supply base, working with them and using our experience and knowledge if the supplier faces a problem. We would also bring in some of our manufacturing people, who have experience in particular elements of engineering process, if there is a crisis. IHS: So given the choice of all three kinds of suppliers, I can safely assume that you will like to go with the third category, the foreign suppliers. Michael Boneham: I dont have any clear specific preferences, what we want is a competitive Indian cost, we want the quality level that meets global standards. There are a lot of indigenous suppliers who already meet those standards, exceed them and actually export their products out of India, not just in our vehicles but to Ford Europe or to the Ford US for example. They are indigenous companies and meet our expectations. However, Ford has this One Ford concept where we follow a commodity based aligned structure and we have global platforms. So, the challenge is how to source globally, because you will have these products being manufactured in different countries, different areas around the globe. The key is how do we get the level of localization we need, as in India where (localization) is about 80-85%, and aligned with global sourcing to get economies of scale? Most likely for us, we will see more global supplies here but there is no reason why we wouldnt see them aligning with local indigenous suppliers in strategic joint-ventures.
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IHS: So in the whole process the home grown suppliers become the third party? Sandeep Sanyal: No. Product development is more reliant on the supplier who has designed it along with the automaker. Typically, it would be parts such as axles, chassis and steering systems. One would not want to redesign and go through the whole process of testing, development and evaluation. The definition of an indigenous supplier is one who has operations in India today, so he would be chosen as the first option, but if that supplier is not in India or does not meet the business requirements of a small car, then it is for the Ford global purchasing and product development teams to meet the business requirement by selecting another supplier who could be given the technical details. But as every supplier is coming to India today, we have a lot of opportunities. IHS: It is also interesting to see most of the global suppliers entering India through jointventure route. Michael Boneham: I think it sort of makes sense, because if a supplier hasnt been in a country like India before, it is often difficult to place your own trial. Or, if a supplier is coming to a new market dedicated to only one OEM, then it is a big risk considering the amount of investment, in case that OEM doesnt deliver on its commitment. One wants to spread their risk. So, it makes sense to make a strategic alliance, it doesnt have to be ownership of business per se upfront, it could be a technical alliance where the global supplier brings his technical knowledge and the Indian partner would bring his strength (plants, the business, the equipment to manufacture). It is a very challenging environment otherwise to get into, for a small niche supplier to be a tier one supplier to an OEM, unless they are vey niche specialists. Sandeep Sanyal: The supplier should have enough volume and business to invest in R&D and technology. Indian suppliers have grown through various acquisitions to get that capability. The good old tradition of thinking that the Indian supplier base is victimized by the onslaught of the global suppliers is not true. Joint-ventures seem to be working well because of competitiveness and technology advancement.
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RAHUL BHARTI HEAD, RELATIONS, MARUTI SUZUKI
CORPORATE
PLANNING
&
INVESTOR
IHS: What has been the impact of the policy changes and macroeconomic factors on Maruti in recent years? Rahul Bharti: [There have been] huge fluctuations in macroeconomic parameters. Most parameters that affect the industry like fuel prices, interest rates, foreign exchange rates and even commodities have shown wild movements. They pose major challenges to both volumes and profit margins and their predictability. IHS: Do you foresee the automotive product mix in India changing substantially in future from the one prevailing currently? Rahul Bharti: The Indian consumer is definitely growing at a good pace and is becoming more technology- and quality-savvy than before. I think the three As aspirations,, affordability, awareness in India are going up. This will definitely affect the way they buy cars but this may not necessarily translate to bigger cars; fuel efficiency consciousness [and later regulation], congestion on the road and multiple cars in the family will tend to keep cars more compact. Safety consciousness is going up. IHS: How are fluctuating input costs affecting the operations of your company? Rahul Bharti: It is definitely putting a lot of pressure on profit margins. Maruti Suzuki is a very customer-sensitive company and the effort is always to try and offset this impact through productivity and efficiency improvement, innovation and partnership with vendors. However, where this is not sufficient, we pass this on to the market in a calibrated way. In future, our concern is [that] inflation will affect all factors - land, labour, energy, capital and this may not be compensated by productivity and economies of scale. IHS: How do you deal with suppliers when there is adjustment in vehicle production? Rahul Bharti: Fortunately, Maruti Suzuki has an approach of keeping the whole value chain lean and healthy. We treat their inventories and their cash flows as our efficiency parameters. Our payment terms are very good and supplier-friendly and the forecasts and production plans we share with them are highly calibrated; so suppliers rarely face problems in our business. IHS: How much progress have suppliers made as far as quality is concerned? Rahul Bharti: The vendor quality levels have definitely improved from the past and vendor rejection ppm [parts per million] levels are going down, but we would like them to be even better and widely spread across all vendors. At the foundation of product quality is quality human talent and our concern in the future is that the Indian auto component industry is not getting sufficient talent availability. Vendors are increasingly concluding that investing in R&D is not just for their brand; it is strategic to their growth. On our part we try to
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deepen the message further by showcasing live examples of successful R&D strategies from within the vendor community to their own counterparts. IHS: How do you see competition from foreign automakers operating in India? Rahul Bharti: Competition is a healthy phenomenon for the market, the customer is always a gainer and therefore we welcome competition. However I think the Indian customer is quite intelligent and makes very smart choices considering the entire life-cycle value of the car and the confidence in the brand rather than only advertisements or discounts. Manufacturers will have to provide cars which are engineered just right for the Indian market. Maruti Suzuki continues to have a strong leadership in the market. If we adjust for some supply side issues, so far there has been no meaningful shift in our market share,. IHS: How do you see the future of diesels in India? Rahul Bharti: The industry is seeking clarity from the government on both diesel fuel pricing and diesel passenger vehicle taxation. The market pricing of petrol and controlled pricing of diesel are creating a distortion in the market, and the toughest part is there is no predictability of the differential. The industry is not able to plan capacities and commit investments in this uncertainty. IHS: Maruti has dealt with a series of labour unrests this year which have impacted its production and market share. Do you expect the company to recover lost production and market share this financial year? Rahul Bharti: We may not be able to reach last years figure. The way we are going forward is we are doing a lot of communication with the workmen at the ground level. Starting Q4 this financial year, the output from the factory will increase as our second plant in Manesar ramps up, and if market demand is good, sales should also pick up. Market demand in petrol models is quite weak, while the diesel models have a lot of demand. This year there is likely to be a negative growth in volumes. IHS: There are some concerns about the short-term growth prospects of the global economy. How will this impact Maruti Suzukis exports? Rahul Bharti: Partially yes, we will also be ending exports negative this fiscal year compared to last year. European markets, which are our major destination for exports, are quite weak. Fortunately we had diversified and so we still have a lot of volumes coming from other markets as well. A weakening rupee has been a positive in this respect IHS: How do you see the medium to long term growth prospective of the Indian automotive industry? Rahul Bharti: The current situation is a business cycle. The long term growth story of India is intact. From the current situation we cant conclude anything about the long term. Broadly speaking, household incomes are growing in India; so are aspirations. Around this zone of per capita income, generally the demand elasticity is also high which means that with
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every percentage growth in income, the penetration of cars per unit population will increase. So we have a very strong consumption story in India, and we believe it should grow faster than in the past. What can hold back Indias growth is lack of infrastructure which is a very well-known fact. In the medium term, there is a lot of uncertainty around government direction, alignment of fiscal and monetary policy, rebound in investments, and rupee depreciation. Once the clouds clear, India should come back on a high growth trajectory. IHS: What changes would you like to see in government policies related to the automotive industry in future? Rahul Bharti: It will help a lot, if the government can give us clarity on diesel pricing. Given the oil burden and benefits of CNG in terms of CO2 reduction, a conscious policy to encourage CNG as an auto fuel can help. On the macro-economic front, the government can really make a big difference by helping investments pick up in the country especially in infrastructure. They have a multiplier effect. Consumption will automatically follow. And, of course, GST should be brought in as fast as possible.
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BHARAT PAREKH, CHIEF, STRATEGIC SOURCING, TATA MOTORS

IHS: What has been the impact of the policy changes and macroeconomic factors on Tata Motors in recent years? Bharat Parekh: The major impact has been due to the tightening of regulations affect various parts of our business. For example, if you look at the bus business, there is a new bus specification which will change the way buses are made. The impact of this is yet to be felt as it is under implementation. We see a lot changes in the way buses are made, it will make buses costlier as a lot of safety features that have to be built in. As far as passenger cars are concerned, there are norms coming up on fuel efficiency and lightweight vehicles. Overall the kind of sophistication that is required in the powertrain is definitely going to change. All these things are driving up the cost. IHS: How do you see competition from foreign automakers operating in India? Bharat Parekh: The resource base that the global OEMs have is much larger and they have possibly twice the experience in operating in the area. Because of the common platform strategy, they are able to leverage much larger volumes for many parts, thereby reducing their cost of production. Also, they have a library of parts and systems of aggregates and sub-aggregates, which have been proven and effective in terms of production capability for a given period of time, so at any time they can create a new model. Tata doesnt have such a library when it comes to creating a new product, as easily as Nissan or or Renault would be able to do, or Maruti because of the Suzuki range. So our time-to-market becomes high. IHS: Do you foresee the automotive product mix in India changing substantially in future from the one prevalent currently? Bharat Parekh: We are just three years behind Europe as far as regulations are concerned. The time period is reducing. Three years ago there was a gap of five years. While ABS, airbags and ECPs are becoming mandatory in Europe, it is already being talked about in India. The level of safety will go up in India. In a couple of years, you will see all these features becoming mandatory in cars. The real challenge comes when OEMs have to provide the said features at competitive prices, or sometimes without extra cost, especially in the case of navigation devices these days. IHS: How are fluctuating input costs affecting the operations of your company, and its impact on your relationship with the supply base? Bharat Parekh: Rises in commodity prices have been so large, the likes of which we hadnt seen in the last 15 years, until last year. There are no trends these days. Fluctuation is so dramatic. Earlier we had price settlements with suppliers about commodities once a year, this reduced to six months and is now three months. So every three months we are required to re-negotiate price of basic commodities such as steel. All non-ferrous materials are regulated directly by London material price exchanges, so they change almost every day.
We are trying to work with suppliers to regulate the number of times we have to change the prices, but it is something which is not in anybodys control. And there are so many reasons for commodities to fluctuate; it becomes difficult for us to predict what will happen. All this creates a lot of pressure, as we are unable to pass it immediately on to the customers. There is huge competition and the extent to which we can talk about price increase in the market is extremely limited. This puts a lot of pressure on us and our suppliers, as we expect them to come up with some kind of countermeasures, including better value engineering to control their costs. So there are no easy solutions to the commodity price fluctuations. IHS: Whats your strategy on dealing with suppliers in case of production suspension at your factories? Bharat Parekh: We keep our suppliers on the same platform as far as sharing information is concerned, which helps them to develop counter measures to deal with our production slowdown. Production suspension is generally planned in advance so suppliers are prepared for that. We have various mechanisms such as vendor conferences and vendor meetings which occur over a period of time. We have a mechanism that we call a vendor council where our major suppliers sit with our senior officers every three months. We share information, such as whats happening with Tata Motors, what various challenges we face, what the initiatives we plan to take, and what contributions we we want the suppliers to make. IHS: What are the quality issues that Tata Motors faces with suppliers? Bharat Parekh: Quality is something which is more about consistency. What we want to make sure that that vehicle to vehicle there is no variability. It means suppliers must follow particular processes consistently. There are two ways in which quality is handled. One, there are various quality certifications which vendors need to have to qualify as a supplier to any OEM. We insist that all our suppliers should have certain ISO standards. Over and above that we have mechanisms to monitor quality including our people visiting suppliers, working with them if they require support to ensure their quality is in compliance with our target. Despite all our efforts, quality is still a major concern that we have in terms of variability. I think Indian suppliers still need to catch up with the world suppliers. As far as technologies are concerned, we do find we still need to depend on multinational suppliers to give us state-of-the-art products. What we look for in a supplier is not just a supplier of parts, but also a solution provider. We depend on multinational suppliers either through working directly with them, or asking our current suppliers to tie up with them and work with them. IHS: What do you think about future of diesel vehicles in India? Bharat Parekh: If you compare both the gasoline and diesel technologies, you will find diesels to be much more fuel efficient because of their high calorific value. Diesel technology has improved dramatically in recent years. It generates less CO2 compared to gasoline engines. From that point of view there is great demand for diesels whether in India or Europe. In Europe over 60% of cars are diesels without any government intervention. In India various lobbies are at work, trying to ban diesel for passenger vehicles at subsidised
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prices. They are talking about dual pricing. So which direction it will go is difficult to say now. IHS: How will Indias signing of various trade agreements impact automakers sourcing strategies? Bharat Parekh: We may plan to produce vehicles in different territories, and change our sourcing base to suit the kind of free trade agreements (FTAs) that have come into force. With the FTAs that have been signed so far, there is no structural change that has happened, except with the FTA signed with the ASEAN countries, particularly Thailand. The Japanese OEMs based in India have benefited and some industries remain in Thailand. They find it easy to produce in one place and distribute to both locations. But so far it has not caused a major structural shift in terms of any other OEM doing the same thing. IHS: The government has introduced a new Land Acquisition Bill in parliament which makes new owners of land responsible for rehabilitation and resettlement. How will this impact the automotive industry? Bharat Parekh: That will definitely impact the auto components industry to start with, as they follow their OEM customers to minimise inventory, have JIT (Just in Time) delivery, and reduce their logistic costs. That will be followed by the OEMs. Of the total project cost, about 40%-50% is for the land. We have gone into systems of creating vendor parks. It happened in Pantnagar, Uttarakhand and Sanand, Gujarat where we negotiated on behalf of our suppliers. We are doing it in Dharwad, Karnataka also where we are setting up a new LCV plant. We are trying to tackle the issue through that route so that vendors dont have to worry unnecessarily about the availability of the land, and the land is available to them at a very reasonable cost. IHS: What changes would you like to see in government policies related to the automotive industry in future? Bharat Parekh: We need to look at the technological merit of anything, whether it is diesel or gasoline, rather than letting ourselves be guided by external factors; it should be viewed on merit. We look to the government to provide more support for R&D to the OEMs in the country by being more lenient towards taxation, and at the same time removing some tariff barriers in terms of imports of equipment. The government is focusing on building up more roads today. It opens up a new generation of opportunities, particularly in the commercial vehicle segment. The government is taking various initiatives to improve roads, but is only delivering one-third of the promised kilometres. That is what we are looking at. We want the government to make sure that all such projects are completed on time. Land needs to be made available to the industry in a more reasonable and conformable manner and with some degree certainty, so that we can plan a project accordingly. It shouldnt take much time to receive clearance for new projects. We are also looking improving power availability, which is a major concern, especially in states such as Maharashtra.
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NEERAJ KANWAR, VICE CHAIRMAN & MANAGING DIRECTOR, APOLLO TYRES

IHS: How is Apollo Tyres dealing with the current moderation in vehicle sales in India and other major markets since the beginning of this financial year? Neeraj Kanwar: A slowdown in vehicle sales has had some impact across the world. It has impacted us too across countries. While it is never welcome news, this is a part of the business cycle that we expect over a period of time. However, other factors have played a larger role. Globally the largest negative impact has come from the unprecedented rise in raw material prices all of last year and this. Apart from this, in South Africa the biggest factors have been an increased influx of underpriced Chinese tyres and higher outlay on shop floor manpower salaries. Over a longer period of time, I would say, these have a more lasting effect on business than the current slowdown. IHS: Has the recent moderation in demand resulted in an inventory build-up, as your company has announced some production adjustment in these markets? Neeraj Kanwar: Like all our counterparts, we too have been feeling the pressure of inventory due to the slowdown and from time to time have had to moderate our planned production. We have planned these well and have therefore managed to utilise these downtimes for machinery upgrading, maintenance and even employee training overall attempts to increase efficiency across our plants. I would like to add that, this notwithstanding, we have been on a growth path for a while now, where production has been steadily going up according to plan, in our latest plant in Chennai. In Europe too, we are currently undergoing a planned expansion to increase capacity by one million more tyres. The same holds true in one of the two South African plants. All of these are planned capacity expansions. IHS: There has been a slight moderation in the price of raw materials, especially natural rubber and oil. Do you expect these trends to continue? Neeraj Kanwar: Yes, there has been a slight moderation in prices in the past month or so, but remember it is coming on the back of a sustained period nearly two years of skyhigh prices. Therefore, I am not sure if it can be considered a relief at all, even though every bit counts. The slight fall in prices came about because of a slowdown in some parts of the world. This, as you know, also resulted in recent currency fluctuations. The weakening of the rupee brings with it yet another dimension. Over 60% of our raw materials are imported since they are not available in India, and whatever we might have gained from lower prices has been more than offset by currency fluctuations. IHS: There were media reports about Apollo Tyres and some other Indian tyremakers planning to enter the rubber plantation business to ensure adequate supply and also deal with its high prices. Dont you think backward integration may also lead to diluting the core focus of your organisation?
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Neeraj Kanwar: The core focus of the organisation is to deliver high performing and safe tyres to its customers across segments and geographies. To deliver this, if it makes business sense to secure supplies through backward integration to feed our manufacturing units we are game for the challenge. We realise this is a completely new business, with a long gestation period, open to multiple influences and requiring different skill sets from what we currently have in the organization. However, given our growth plans, we feel this is the right time to venture into backward integration as a risk mitigation strategy, in an attempt to secure a percentage of our future supplies. IHS: Tyre manufacturers operating in India have been asking the central government to reduce custom duty on imports of natural rubber up to 100,000 tonnes to meet inadequate domestic demand. Do you have any update on progress in this area? Neeraj Kanwar: After long discussions, the government reduced the duty on imports for a certain period of time. However, to be very open with you, we, in the tyre industry, have been talking to the government on multiple issues for years now, including the need to look at a partnership model on rubber plantations, but little has really moved. I am sure that you are aware, despite all our efforts, the tyre industry is the only sector which continues to have an inverted duty structure, where it is cheaper to import tyres into India, rather than importing the raw materials and manufacturing them here! IHS: A cheap tyre import from China has been a major concern for domestic tyremakers for the past few years. The problem seems to have further increased by the recent decision of the Indian government to abolish anti-dumping duty on such imports. How does this change in government policy impact Apollo Tyres? Neeraj Kanwar: Manufacturers in China enjoy a fair number of relaxations in exports, as well as in manufacturing. We continue to be baffled by the cost at which they sell their tyres, given that raw materials are purchased by all manufacturers on a global level. Naturally, this puts the domestic tyre manufacturers in the country of export at a disadvantage. It is a global issue. However, having said that, the Indian tyre industry is investing close to INR100bn (USD2bn) in new plants, increased capacity and new technology and therefore it definitely does not come as good news for us. While Chinese imports are not a massive threat for the established players yet in India, my concern is that we need to be very careful and ensure that India does not go the way of countries like South Africa. Having said that, it is also an opportunity for us to look inwards and see how much more value we can create for our customers. We know that the Indian customer seeks service, safety and therefore quality products. Customers will show a preference for our products, as long as we are able to deliver these, especially service. So in many senses, in business, we need to keep doing our job better every day, without always looking over our shoulder. Indian customers are quite mature. IHS: What is your take on India entering into several bilateral and multi-lateral trade agreements? Do you see this resulting in an increase in imports or does it mean easier access to more markets?
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Neeraj Kanwar: In my view, strong and fruitful trade agreements are the way of the future. They facilitate healthy competition. However, so far Indian PTAs and FTAs have not really benefited the tyre industry or the raw materials that we use. In terms of exports out of India, there has not been any attention given; for imports into India, the lopsided duty structure allows tyres to come in at a low rate of duty, anyway. IHS: A large number of global tyremakers are expanding their presence in India. Could you please comment on the issues related to having more intensive competition in the coming years and how does Apollo Tyres plan to address them? Neeraj Kanwar: Global competition, riding on advance technology and with quality products is actually the need of the hour. It will push all of us to move to the next level of technology, speed up market evolution in terms of consumer mindsets and marketing, educate customers and enable them to demand better products. The arrival of global majors in a stronger format will also ensure a certain pricing discipline which will help the industry as a whole. Having said this, the Indian market has actually been exposed to global manufacturers for a long while now. Bridgestone and Goodyear have been here for decades and are also large OEM suppliers. Michelin has been importing into India for over 10 years too. But their presence with a large manufacturing base, will positively create greater competition. We have addressed certain areas, and now look to step up the pace. These are primarily in the areas of: a healthy product mix, product innovation, customer service as a differentiator and value driven marketing schemes. IHS: It is more than two years since Apollo Tyres acquired Vredestein Banden. How has the acquisition helped your company to expand its reach in the European tyre market apart from providing a manufacturing presence in Europe and expanding your customer base? Neeraj Kanwar: I am very proud of the integration process that has been followed and the positives that have benefited all parties. On a level of what is apparent to external stakeholders, Apollo Vredestein in the Netherlands, brought into the organisation an excellent manufacturing facility along with a very passionate group of people, ease of access to the extremely competitive European market through a developed network of outlets and sales force and of course a customer base. All this enabled us to launch Brand Apollo in four critical European markets last year, both summer and winter tyres. And we are currently in the process of expanding both the Apollo and Vredestein brand ranges in the high end passenger car category. Beyond this, it is people practices that have really been the winner through exchange of best practices, global training programmes and focus on aspects of research and design which have a global impact. Also the infusion of capital and the Indian capability of taking risks have been positives. We are currently in the process of increasing capacity at the Enschede plant which is quite exciting, along with the introduction of newer products, faster.
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IHS: You have introduced the Apollo brand in a highly-competitive European automotive market. How has the response been so far? Neeraj Kanwar: We are extremely happy with both the performance of Apollo tyres in Europe, as well as the customer response. Our summer tyres did well. And both last year and this, we have sold our entire production of winter tyres. We are currently present in the UK, Germany, Italy and Netherlands and are definitely looking to expand the base. Our challenge is currently a pleasant one of not being able to produce and ship across enough to fulfil the demand created in these markets by our excellent sales teams. We are in talks with a number of OEMs for Europe, but have not finalised on any of them yet. Our tyres have been tested by some of the leading automotive magazines like Auto Bild and ADAC and there too, the results on various parameters have given us that added confidence to move ahead. IHS: Radialisation is increasing fast in India. How do you see this change impacting your business in India in the future? Neeraj Kanwar: You are absolutely right about this. However, it is also not that easy for the CV segment to move swiftly to radial tyres, given that across India we have neither a uniformly developed road infrastructure, nor the ability to use newer generations of commercial vehicles. However, the CV segment has recently radialised at great speed. From a base of 2-3% in 2004, we are currently at 15%. Our own forecasts show that in the next three years, we expect nearly 25% of the commercial segment if not more to be on radial tyres. Given the diversity in our country, the varying applications and our growth challenges, I am happy with this pace of radialisation and would not at this point talk of complete radialisation. In terms of business realisation, radial tyres, due to the technology deployed are safer and also bring us higher margins. However, from the customer point of view, he or she also needs to take better care of radial tyres. Given this, and to grow the market, for the past few years, even though we have produced in small volumes, we have been focusing on customer education to enable them to make the shift. We have a techno-commercial team called Forza whose sole job is to work with customers to ensure that they realise higher value / mileage / business realisation from the shift to radials. IHS: How has the recent depreciation in the Indian rupee impacted your business? Neeraj Kanwar: Foreign exchange fluctuation is an area of concern. In the past quarter the rupee has depreciated by 10%. This has impacted us adversely, since nearly 60% of our raw material is imported due to their non-availability in India. However in a global operation, it is part of the reality. While the rupee losses will not be offset, since our dealing in Indian rupees is much higher than any other currency, we tend to gain marginally when the euro strengthens for example. IHS: And finally, your company has set an ambitious goal of achieving sales of USD6bn over the next five years. How do you intend to reach this goal?
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Neeraj Kanwar: USD6bn really means a tripling of our turnover in five years. This means that we need to keep all our options open and it will positively be a combination of organic as well as inorganic growth. We undergo a five-year strategic planning process and this has already thrown up for us the areas of focus the products we need to increase, rationalise as well as incorporate into our portfolio; it has identified the geographies of focus and we have put in timelines to this; the planning has also highlighted our people- and skill-needs as well as our capital requirements. All this is work-in-progress, and we will implement them according to timelines and prevailing market conditions. This is the organic side. On the inorganic side, we will continue to focus on opportunities which bring value to the organisation.
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SHVETAL VAKIL, EXECUTIVE DIRECTOR, SETCO AUTOMOTIVE

IHS: How has recent moderation in vehicle demand impacted Setco Automotive? Shvetal Vakil: As a company, we are posting pretty reasonable kind of a growth and our growth rate is higher than the industry average. It is primarily because of our product mix and the market portfolio we have, unlike some companies who are predominantly OEM suppliers, and some companies who are predominantly aftermarket suppliers. We have a very judicial aftermarket, OEM and export balance. Another focus area is commercial vehicles. All commercial vehicles from October 2010 have moved on to new pollution norms. And, therefore, we have been upgrading clutches in order to meet the regulations. And for those earlier products we may have 80% market share, and somebody else 20%. Today, we are probably the only one able to offer that. Hence, our shares have moved up substantially. Plus these clutches are at a much higher value than the original one because of technology differences. Our growth rate year-over year (y/y) over the last two years is much higher, about 43% CAGR (Compound Annual Growth Rate) over the last five years, compared to industry growth rate which has been just hovering around 20%. IHS: As a supplier, do you have any bargaining powers when it comes to supplying OEMs? Shvetal Vakil: Yes, we do. We have a sort of unwritten understanding, and the OEMs will compensate us for any increase in material cost. We are expected to show efficiencies in our processes and systems to take care of any inflation pressure on other costs like manpower, etc. Should material costs increase, the same would be compensated for by the OEMs. It does not however have an immediate effect. For instance, if I say my prices have gone up today, please give me an increase; they may not do it with immediate effect. They would probably take a couple of months to go through the details of cost increase, etc and verification. And, maybe in a couple of months time, they will sanction it and that sanction would be retrospective. There will be no real loss of opportunity or margins. IHS: What steps is Setco taking to avoid adverse impacts of increasing commodity prices? Shvetal Vakil: We have been in a significant bargaining position to get special prices from the suppliers, plus most of these vehicle manufacturers have an (association with us). They (OEMs) also buy steel, we also buy steel. They buy from Tata Steel, we buy from either Tata Steel or ancillaries of Tata Steel. So if they already have an understanding with Tata Steel, then Tata Motors and its vendors could be given materials at x% below market price. We leverage our association with an OEM when it is required; where we are not able to do so, we use our bargaining power to obtain an incremental price due to increased raw material costs. IHS: How has Setcos growth affected quality compliance requirements set by OEMs?
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Shvetal Vakil: It has in fact had a positive rub-off. Because of the quality upgrades, environment norms have changed the clutch requirements and some of the component requirements, which not many people are in a position to offer in India, but we are readily able to offer. In fact, that has helped us to increase our market share of the business from the OEMs rather than lose it. We have the requisite ISO and OHSAS standards certification mandatory for any component supplier. Then there are the periodic visits from customers. We meet their R&D and their quality people quite regularly. Any changes required in our processes/systems etc are promptly taken care of, and improvements made. IHS: The global automotive industry seems to have entered into another slowdown and vehicles sales have declined in some automotive markets. Has Setco Automotive faced any pressure on exports? Shvetal Vakil: I will share a peculiarity of this industry with you. In a year, when vehicle sales dropped, it typically meant the customer did not buy a new vehicle but continued to use the old vehicle and extend that old vehicles life. Now, to make any changes or modifications or changes in the parts etc the customer would rather buy in a replacement market or change the clutch or change the gearbox and enhance or extend the life instead of buying a new one. Typically, when vehicle sales drop and OEMs demands drop, I would say that a corresponding (though not necessarily proportionate) growth in aftermarket is witnessed. Since we are balancing ourselves properly, any dip in the OE business, we are able to offset it in the aftermarket. IHS: How much has exchange rate volatility affected Setco Automotive? Shvetal Vakil: About 25% of raw material, in value terms, is imported. And we bought it mainly from the Eurozone. So anything which happens to that would have an impact on us. But as I told you, if there is any increase in costs, we are able to pass it down. So, in the short term, yes, but in the long term, I do not see much of a problem. IHS: As suppliers face challenges in both the situation of growth and recovery, how do they respond to these swift changes? Shvetal Vakil: We prepare ourselves in anticipation of a growth rather than starting to invest in capacity enhancements when we are in the growth phase. We dont want to lose out on any opportunities. So, if I put some money in for the next three or four months, and demand has not gone up, I might lose my money, but subsequently when demand moves up while others are trying to ramp up capacity, we already have the capacity needed. Today, we have a pretty comfortable situation. And we have plans to put in about INR1bn (USD20m) over two years to ramp up capacity in terms of augmenting, debottlenecking and being able to gear up for the next growth phase. If there is a certain month when there is a bad slump, production has to drop or be laid off. We productively use the workforce for the necessary training so that we are able to improve their skill sets; they are motivated, so they do not feel there is a problem.
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J SIVKUMAR, PRICOL
IHS: The Indian automotive industry has gone through a deceleration in demand after great growth in the last two years. How has this affected you? J Sivakumar: We had some impact but we're trying to make it up with exports. We've tried to bridge that gap. Initially, we budgeted conservatively. We did not budget too high a figure for that. It was basically done on that phase. IHS: Did it work? J Sivakumar: Initially we thought we would have something like a 15% growth. Actually we've come down to 13% if you compare it with last year. That's what we're anticipating. But we're very conservative as such. IHS: Pricol went through an unpleasant phase in the last four years after a strike during which a senior member of the management was killed. It impacted your financial performance and you lost some contracts. But I believe that you're making sincere efforts to return to normal? J Sivakumar: We've just overcome that. In fact since that 100-day strike, we haven't had any issues on that. We're trying to get back to our original shape. Whatever loss we had during that time, we've suffered that in the last two years, hopefully, this year we're trying to regain those things. That's the reason we're targeting a growth of 15%. But unfortunately, the market does not support that. That's the reason we're dropping that figure slightly. IHS: Pricol has shifted focus from automotive to non-automotive service such as engineering services, realty and travel? J Sivakumar: It's changed. Our major focus was on the automotive sector. We're not trying to leave the automotive sector, but within automotive, we're looking to see what else we can do, innovative, new technology products which we're trying to create, that's how we're trying to gear up for the future. IHS: I was talking about Pricol's plans to increase its non-automotive business to about 30% of its total. Would you like to comment on that? J Sivakumar: It's too early to comment on that. We're working on some new projects, but it's at the Board level. I can't comment on that. IHS: Pricol's automotive business will continue to be the mainstay for quite some time? J Sivakumar: Up until two years down the line, we'll be on the same platform. But we're thinking of new products (in the non-automotive segment) to come in and take over. But it's all in the preliminary stage. Its still under discussion, which products to take, what will be the original temptation, how it will be percolated down; it's all at that level. It hasn't come down to the operations level yet.
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IHS: A lot of media reports say Pricol is reducing its dependence on the instrument panel business. Do you think fast improvement in technology is pushing conventional suppliers into the periphery? J Sivakumar: We had that phase initially. Now we're trying to work out joint-venture partners or some other arrangements so that we're on a par with the technology today. We're working with our partners on this. We think we'll not lose that much. IHS: So you're not thinking of reducing your exposure to the instrument panel business? J Sivakumar: That's our main stream of business today. Until we have other products that we take up and get stabilised, we'll continue to focus on this product. IHS: Other products in the automotive sector? J Sivakumar: The non-automotive products. That will take some time; we can't lose our market share, that's our main business. IHS: Instrument panels rarely get replaced. There's not much of a replacement demand for it. J Sivakumar: To be a market leader we always think that we should be ahead in terms of technology. In the instrument business, there's a lot of competition. To continue to be a market leader, you need to have other products too that will ensure revenue generation and growth. We expect 10% growth in this business in future. About 10 years ago, Pricol had roughly 25% growth. To return to that level, we should work on non-automotive products, that's what we're trying to do. IHS: Pricol announced this year that it's planning to hive off its Pune plant into a separate subsidiary to rope in a major technology partner. How much progress has been made on that front? J Sivakumar: It's still at the board level. They're still discussing it. It's not come down to the operational level. IHS: Your company is also planning to diversify into other automotive products? J Sivakumar: Already we're into technologies like CNG in which we didn't have product lines before. Products like oil pumps, new technology oil pumps for four-wheelers and commercial vehicles. IHS: Pricol is also looking at moving to high-margin sub-assembly business? J Sivakumar: Today's automotive industry is demanding sub-assemblies. Earlier, they wanted only parts that they were doing. Today, they want the entire sub-assembly to be done and offer to the OEMs. We're looking at that line to see what we can do. That also calls for a huge investment which we're working on as part of our long-term strategy. This is still under discussion.
IHS: This would also increase the outsourcing of component production to your vendors? J Sivakaumar: Obviously. It may work both ways. Some of the components may be jointly developed with the OEMs. They will indicate who will be our tier two and tier three supplier partners. IHS: Which product lines are you specially targeting for this? J Sivakumar- All this is still under discussion. For instance, we were looking at the handle bar assembly. Actually we take a majority of the cost since we're taking this initiative. They would like to have the handle bar assembly as a set, or the IP panel as a set. We're still talking. It will take time to come to operations. IHS- Say two years? J Sivakumar- Yes, in about one or two years. IHS- Pricol has set a goal to double sales in the next five years. Do you think this target is achievable considering the market situation now? J Sivakumar- Yes, that's why we're working very hard on automotive and non-automotive products. All these things when put together should help us achieve these goals.
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SHAILANDRA BOHRA, MARKETING DIRECTOR, BOHRA RUBBER

IHS: What are Bohra Rubbers plans regarding capacity expansions? Shailandra Bohra: We have a good clientele in the western part of India so we are planning to set up a plant there. We are planning to do so in Gujarat, but at the moment we are looking at Karnataka. We have two or three locations in mind from where we can serve our Chennai customers and also our customers in Karnataka and Maharashtra, so that both the western and southern belts are covered. IHS: Do you think you would be able to share with us what kind of investment you are looking? Shailandra Bohra - We are looking to invest approximately INR70 to 80m (USD1.4 to 1.8m) overall up until 2012. It probably will be spread out in our two facilities but primarily we are looking first at Karnataka then Gujarat, because that is where all the (OEMs) plants will come on stream in 2013-2014. They (OEMs) are just finalising this. So, as our operations are less complex, we need much less time than our suppliers to set them up. IHS: How much time will it take your company to set up the plant? Shailandra Bohra- Once we plan to set up a plant after breaking ground, subject to all the government approvals being received in time, we are looking at round about eight to nine months, because we will use pre-fabricated structures, not built-up structures, this is our company policy. The pre-fabricated structures do not take very long to set up. IHS: When it comes to investment, we are witnessing still-high rate of interest due to Reserve Banks anti-inflationary initiatives over more than one and a half year. How this will impact your funding cost? Shailandra Bohra -Funding costs have actually gone up by approximately to 3% in the last 18 months. It has an impact on ours (borrowing), but there is something that as a company we cannot get away from. Whatever we plan, we plan around it. Funding costs is one of the factors which stop people from investing. IHS: Along with high interest rates, high fuel prices are also impacting demand and thus affecting vehicle production in India. What do you think of that? Shailandra Bohra -I personally feel, I may be wrong, that society adapts to these things. For a period of time you are not going to stop buying a vehicle because the (fuel price) is INR60 (USD1.2) a litre or INR70 (USD1.4) a litre. It is a shock to start with, but after a month or so you get back to your routine. Though interest costs have an impact, consumer loans have an impact then it becomes expensive. But India has been a high interest rate country; its never been lower than 10%, 12% or 11%. So there is something which fluctuates, but over a period of time, people will get used to it and then the surge in the market and our volumes will return.
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IHS: So are you witnessing any kind of concern from your clients to hold back for some time? Shailandra Bohra - I dont see the cuts as such, but its like plateauing off, so there is no rush to get something new. Fortunately, we have some products for the new Hyundai model (Eon) and for the new Swift which has come out. These models have helped us in the sense, and volumes are growing there. But what has gone away is the urgency, (earlier) there was an urgency to rush ahead and get this done. It is quieter now. It is not that there is no production and I dont have anything to make on the shop floor but the rush for things where we had to fit in everything with us (is no longer there). IHS: But is that a concern? Shailandra Bohra-These are some little dips which need from time to time in order stabilise the whole thing. It helps us internally also to stabilise our operations and gives us some breathing space. I think it holds true for all companies of all sizes, it gives us time to think and strategise; otherwise in a rush for things, when everything is happening so quickly, you are just playing the catch-up game all the time. So these few months have given us time to plan, make some changes here and there in the long run to increase our efficiencies. Otherwise you hardly find the time to do that because everybody is preoccupied, the machines are preoccupied the whole system is preoccupied with everything. IHS: So you supply both tier one suppliers as well as automakers? How is the relationship with these two sets of customers? Shailandra Bohra- Generally, OE customers are better pay masters and they have larger volumes (than tier one customers). Fortunately, the tier one customers that we have are all major players, so we dont have that problem, as most of our tier one customers have volumes equal to OE customers, because they are single suppliers to OE and we are single source suppliers to them. But I think the gap between the OE and tier one customers is now getting smaller in India. Before, the tier one customer was less aware of this business level and the OE customer had comparatively higher levels of understanding about the quality system, but now both the OE customers and the tier one customers we supply to, are almost on the same level in terms of their knowledge and expertise. I think tier one suppliers are much easier to relate to in the sense, they also relate to your problems much easier, whereas OE customers are much more demanding, but the support is a little slow to come because naturally they are in a different level in the paradigm. Whereas the tier one suppliers understand your problems much better because they do the same thing and they have been through more than an OEM, overall the system in India has massively improved over time, in the sense that it is now more of a collaborative effort than was the case about four years ago. IHS: How is working with tier one suppliers different from OE customers in terms of cost and quality?
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Shailandra Bohra: Earlier there were some differences in the way we used to operate and the tier one suppliers used to operate, but that has now has vanished. Now a good tier one supplier, who has good technology and is well placed, is as good as an OE, because now they are themselves also much more aware, they ensure that the participating approach is there with the OEs and with us. Before they were very cost sensitive, but the goal post is now more quality in most cases. Cost is still an issue but what used to happen earlier was that cost was the goal post and then we used to move around and make the changes in the quality. Now I think for the last four years or so that has changed, and the quality has become the goal post, after which we work around the cost. IHS: A lot of foreign automakers entering the Indian automotive market are getting their own suppliers, since they share global relationships. How difficult is it for the local suppliers to secure business from such new entrants? Shailandra Bohra: It depends where they are coming from. I think the Europeans and Americans have a little open mindedness about who works with them, but the OEMs and companies from Asia primarily Chinese, Japanese and Koreans, trust their systems more. But if you look at the Maruti Suzuki models, they have a lot of collaborations and it has worked out really well. However, if you look at the Korean models, they have brought in most of the suppliers themselves, whereas Ford and GM probably have more Indian suppliers than foreign suppliers. So that is a constraint but I dont think we can miss that way, we have to work it out within the parameters. When we start competing with the worldwide benchmark, though I must add here, a company that is operating under a foreign name may not be better, but because the brand is attached to it, by default it becomes better, although it may not be better in systems or processes. Thats the unfortunate part. Then its no more a level playing field. We have missed some opportunities just because we didnt have collaboration. Although I dont want to say that we would have been able to deliver better, our delivery level would have been on a par with those to whom we lost out. IHS: Automakers are expecting their suppliers to become assemblers or module suppliers rather than just being suppliers. How does this impact small suppliers? Shailandra Bohra: It does not help our cause because we are the component manufacturer at the moment so we move down the value chain. But I think in the long run, what will happen is that we will also try to catch up and move up the value chain as module assembler. But that is right, because now there are more and more smaller companies or tier two suppliers who lose out, and even tier ones have problems, as does any smaller company who does not have a profile where they can supply assembled components. We have also been challenged, but fortunately the product profile that we supply at the moment does not use a lot of number rubber assemblies, they will use plastics, metals and others. It is mostly used as a product assembly. But that is a big threat.
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AMIT MUKHERJEE, DEPUTY EXECUTIVE DIRECTOR, AUTOMOTIVE COMPONENT MANUFACTURERS ASSOCIATION OF INDIA (ACMA)
IHS: What are the challenges Indian supplier industry is facing currently? Amit Mukherjee: Scaling up capacity is a one challenge, skill development is a second challenge, coping with inflation is another and the raw-material price going up is another challenge. But the challenges are always there because whenever you are growing, whenever you are looking at the growth, the challenges will be there throughout. Challenges are everywhere. Even Europe is facing a challenge of finding skilled labour in the auto industry. But we have to address and take it forward. As an association we are always proactive with taking challenge with the government and different bodies. IHS: How have the high interest rates over the past two years impacted expansion plans for the supplier industry? Amit Mukherjee: Suppliers have to relook at that part because whatever investments are happening, the component industry has to invest a huge amount. About 70% of our members are micro, small and medium enterprises (MSME). So the large tier one companies can negotiate the rate. They can get interest rates at 10%, maybe 8.5% to 10%. But the borrowing for the small and medium enterprises is very challenging. IHS: There are schemes that ACMA has started? Amit Mukherjee: One initiative that we are taking is we are interacting with MSME on a regular basis. The government is working for the 12th five-year plan, to which we have given our recommendation. We have recommended looking at developing technological development funding for small and medium enterprises. We have discussed with SIDBI on regular basis over the last six months on how it could be addressed, what new opportunities could be addressed, looking at the needs of the small and medium enterprises. So we are regularly updating MSME. IHS: What do you think of suppliers bargaining power with OEMs? Is it true that some suppliers enjoy greater bargaining power because they supply more critical components than other suppliers? Amit Mukherjee: What is important to understand is that globally, if you look at the top most profitable companies, these are the companies who have a technology. If you do not do any value additions, if you are not doing anything which is a technology development, you cant have a dialogue with peers. But everybody listens to genuine things. You have to have a generic reason to explain to your customers, and sometimes they listen. But it is always a challenge, because today imports are also going up, China is coming along in a big way, which is a threat for us. If you dont supply, then Chinese companies will supply. IHS: India has entered into several bilateral and multilateral trade agreements with many countries and regions. There are negotiations going on for a Free Trade Agreement
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(FTA) with the European Union. How does ACMA see such agreement affecting the local supplier industry? Amit Mukherjee: FTA is all fine but there has to be a level playing field. But the issue is that we are struggling with infrastructure and power, among other things. Inflation and interest rates are so high. Besides labour issues are there. Sometimes it becomes very difficult to be competitive. IHS: But these trade agreements India is signing are also opening markets for exports? Amit Mukherjee: We need to understand which markets we are addressing. If you look at our exports, about 60% go to North America and Europe. Today, if you want to export to Japan you will not be successful, because the Japanese believe in a keiretsu system. The Koreans have a similar system. So any trade should be both ways, it should not be onesided. It is very difficult to break Japans keiretsu because they follow that system as a practice globally. IHS: Japan has been grappling with the strong yen for some time now, and automakers and suppliers operating there are looking to source components from low-cost countries like China, South Korea and ASEAN market, but India does not seem to be on the scene? Amit Mukherjee: Because they have a strong base in Thailand and China, and wherever they have strong base, they would prefer to buy from there. But that is fine. We feel there are lots of opportunities in Japan. Our concern is more on strengthening tier two and tier three suppliers so that we can create a value system in the whole supply chain. So this is the area we are addressing as far as the value system is concerned. We are looking at mergers, joint-ventures and technology tie-ups to strengthen the value system. IHS: What you are doing on the technology development front? Amit Mukherjee: We have tied up with the Fraunhofer Institute (Germany). We did a technology day which was a joint initiative of SIAM and ACMA and we are looking at joint development of lightweight components. Some of the companies have also engaged directly with Fraunhofer on the technology development. We also work very closely with MIT (Massachusetts Institute of Technology) to develop some of the programmes in India. We are also looking at possibly working with other institutes globally. IHS: A lot of automakers who come from outside usually get their own suppliers who supply them in the global market. Dont you think that the Indian automotive supplier sector may not be gaining as much as it should? Amit Mukherjee: We have an FDI (foreign direct investment) policy in which there are no restrictions, where anybody can come and set up their operations. We are a democratic country, thats how we follow our systems. But we are trying to focus more on somehow creating partnerships, collaborations and joint-technology development where research work can be done in Europe and manufacturing looked at in India. We are discussing with
many companies, and some of the large tier one companies are also going for joint-ventures or partnerships. IHS: The colour of the sector is changing because we have so many foreign suppliers now who have come into the market and the industry is not the same anymore. It happens with growth, but you dont think that there is a pinch somewhere? Amit Mukherjee - Pinch will always be there because the competition is growing. If somebody is coming and setting up their operations here, the competition will be there. One is that, you can look at strengthening the technology development. We have to address how the partnership would help because there are many Japanese companies who have strong process and product technologies. So we have to engage more with an open mind on how we could look at possible development. IHS: Quality is another issue that a lot of OEMs talk about. A German automaker said how important it is for them to continue checking the quality of components that are coming on to their line even if they have been tested and validated in the beginning. So is there some trust lacking there? Amit Mukherjee: Quality as far as meeting customer requirement is concerned has to be clearly defined. Everyone has certain issues with suppliers, it happens worldwide. Toyota is recalling their vehicles, Suzuki is recalling their vehicles. So there is always a scope for improvement. You need to understand that the industry started about 30 years back. If you look at companies in Germany, they have been supplying for so many decades. So you have to accept it is a transition period. It is an ongoing phase. If customers say something, there is a lot of scope for improvement. Having said that, there are 12 Deming Prize winners in India, which is highest number outside Japan. So there are companies who are doing really well so far as quality is concerned. But still everybody looks for improvement. IHS: Suppliers always want to be listened to by automakers, so how does suppliers association ACMA interact with automakers association SIAM? Amit Mukherjee: We have an OEM committee which interacts regularly with SIAM to discuss common issues and concerns. We discuss OEM-supplier relationships, but we don't discuss individual pricing because that varies from company to company. It is mostly about the future, like what is the growth expected and how should the industry prepare itself, if there is a concern on scaling up which needs to be addressed. IHS: A lot of international purchasing offices (IPOs) are being set up in India. ACMA has set up an IPO forum. Please tell us more about it? Amit Mukherjee: We have set up an IPO Forum which acts between suppliers and their global customers. It is a type of shock absorber because they are the contact for us for their global customer base. For instance, GM has an IPO office, so GM coordinates with their global requirements. It is a networking for the IPOs also, because, they also share their concerns and how they are addressing those concerns. It is also an opportunity for the suppliers to address those concerns, requirements and potential opportunities. We are also
developing some training programmes, like project management is one of the areas that has been addressed by the IPO forum and we are doing a programme on supplier development. IHS: ACMA has said that automotive production turnover in India by 2020 will be USD110m. To achieve that turnover, we need huge investments. Considering the kind of investments happening now, how is it going to be scaled up? Amit Mukherjee: We have to be optimistic. We see the potential and can foresee an investment of INR2 to INR3bn (USD40m to USD60m) every year. There needs to be investments in technology development. Tier one suppliers are in a better position because they have the technology and hence the power to bargain. They are increasingly becoming the assemblers. Investment has to be done by the component manufacturers. So, you have to instil value addition, you have to be innovative and develop engineering skills.
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Aisin Seiki
Chassis, drivetrain and transmission systems
Address Aisin Seiki Co. Ltd 2-1 Asahi-machi Kariya Aichi 448-8650 Japan Tel: +81 566 248 441 Fax: +81 566 248 003 Internet: http://www.aisin.com Regional Address Aisin NTTF Pvt Ltd 40/40A, Electronics City, Hosur Road, Bangalore Karnataka - 561 110 India Tel: +91 80 2852 2212/2213 Fax: +91 80 2852 2214 Senior Officers Kanshiro Toyoda, Chairman Yasuhito Yamauchi, Vice-Chairman Fumio Fujimori, President Shunichi Nakamura, Executive Vice-President Norio Oku, Executive Vice-President Masuji Arai, Executive Vice-President Products Active rear steering systems, aluminum die castings , automatic transmission, air suspension systems, antilock braking systems (ABS), body components, brake and chassis related products, car navigation systems, chemical products , control valves, compressors and dryers, drivetrain components, electronic control units (ECU), engine related products, hybrid systems, ironcastings , magnesium die castings, manual transmission, parking brakes, press components, plastic mouldings, resin mouldings , stability control systems, sensors Plants India (3): Haryana, Karnataka (2) Outside India: Australia, Belgium, Brazil, Canada, China (19), Czech Republic, Indonesia
Aisin Seiki is a major supplier of drivetrain, brakes, chassis, engine, body and information related products to the automotive industry. Toyota is the largest shareholder in the Group with a 23.3% stake.
Aisin Seiki operates its business through six segments, five of which cater to the automotive industry: Drivetrain-Related Products (43.1% of the total 2011 sales): automatic transmissions for passenger, manual transmissions, continuously variable transmissions, hybrid systems, clutch master cylinders, silent clutch discs, flywheel, torque converter, motor shift actuator, clutch cover. Brake and Chassis-Related Products (20.1%): brake booster and master cylinders, disc brakes, drum brakes, antilock brake systems (ABS), electronic stability controls (ESCs), air suspension systems. Body-Related Products (17.5%): door latches, power sliding door systems, power back door systems, sunroofs, power seats, occupant weight sensors, door frames, door handles. Engine-Related Products (9.8%): water pumps, oil pumps, pistons, intake manifolds, exhaust manifolds, variable valve timings (VVT), cooling fans. Information-Related Products (5.9%): car navigation systems, parking assist systems, lane departure warning systems, intelligent parking assist, front and side monitors, driver monitoring systems.
The sixth non-automotive segment, Life Related and Other Products, accounted for 3.6% of the net 2011 sales. As of March 2011, Aisin Seiki had 165 consolidated subsidiaries in 20 countries. The company generated 70.2% of its total sales from Japan, followed by North America at 11%, Asia & Others 11.4%, and Europe at 7.4%. Aisin Seiki has been present in India since 1999 when the company entered into a three-party joint-venture with Nettur Technical Training Foundation (NTTF) and Toyota Tusho. The three partners set up a manufacturing subsidiary Aisin NTTF Private Limited in Banagalore, Karnataka to supply Toyotas Kirloskar assembly plant in the region. Aisin owns 79.76% stake in Aisin NTTF, NNT has 15.24% and the remaining 5% is with Toyota Tusho. Aisin NTTF manufactures interior parts such as door latches, window regulators, door hinges and sheet locking devices. In December 2011, Aisin Seiki announced it would set up two new manufacturing plants in India, one in Rohtak, Haryana and the other in Bangalore, Karnataka. Toyota remains Aisin Seikis biggest customer. Its other major customers include Chrysler, Daewoo, Daimler, Ford, GM, Honda, Isuzu, Mazda, Mitsubishi, Nissan, Suzuki, Volkswagen and Volvo. Recent Developments Corporate strategy Aisin Seiki is expanding its presence in international markets in order to support carmakers across the globe. Over the last five years, the company has made large investments in Asia, Europe and North America. The company is primarily focusing on high growth potential market in emerging countries. In Asia the company has mainly focused on the Chinese automotive market. However, the company is also looking toward strengthening its presence in the
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(2), Japan (12), Mexico (3), Taiwan (2), Thailand (9), Turkey, UK, USA (18) Sales Group: JPY2.3trn (USD27.2bn, 31 March 2011) (Year to 31.03.11) India: N.A Employees Group: 74,671 (31 March 2011)
India, another dynamic market in the region. The company, which had so far operated only one plant in the country, announced its plan to invest in two new plants. Aisin Seiki established one plant in Rohtak, Haryana to meet the demand from customers operating in Northern India. The company established another plant near Bangalore, Karnataka to cater to automakers having manufacturing presence in southern India. The company has made a combined investment of INR1.02bn (USD18.7) in these two manufacturing subsidiaries. Meanwhile the company continues to operate its first manufacturing subsidiary Aisin NTTF which has a production plant in Bangalore, Karnataka. The companys expansion supports AISIN Group Vision 2015 implemented in April 2008. The plan focuses on creating unique system products and introducing variety in business operations. With Vision 2015, the company aims to achieve an overseas sales ratio of 50% and ROIC (return on invested capital) of 15%. Consequently, Aisin Seikis product development focuses on improving environmental emissions, road safety and driving comfort In addition, the company will continue to concentrate on its drivetrain business, which is the biggest contributor to total sales. Investment In December 2011, Aisin Seiki established two manufacturing subsidiaries, one in Haryana and other in Karnataka (India). The company set up Aisin Automotive Haryana Limited (AHL), which is located in Rhotak, Haryana with an investment of INR710m (USD12.9m, 30 December 2011). The subsidiary will be engaged in design and manufacture of automotive components to cater to automakers in northern part of India. The companys other manufacturing subsidiary is named Aisin Automotive Karnataka Limited (AKL) which was established in Bangalore with an investment of INR310m (USD5.6m). The subsidiary will produce auto-components primarily for automakers in southern India. Contract Aisin Seiki supplies several automotive components such as door latches, window regulators, door hinges and sheet locking devices to Toyotas Kirloskar plant in Bangalore, Karnataka (India) New Product Developments Aisin Seiki has several research and development (R&D) facilities in Japan, as well as one each in Belgium, Germany, France and four in the US. For the year ended 31 March 2011, Aisin Seiki spent JPY111.4bn (USD1.3m, 31 March 2011) compared to JPY101.1bn (USD1.1m, 31 March 2010) in financial year 2010. Aisin Seiki is improving its produce range by including multistage transmissions, CVTs, automated manual transmissions and hybrid systems. The company is also working on the development of new drivetrain units in response to the anticipated high demand for hybrid cars. Financial Overview For the financial year ended 31 March 2011, Aisin Seiki reported a 9.9% increase in net consolidated sales JPY2.3trn (USD27.2bn, 31 March 2011) compared with JPY2.1trn (USD22.16bn, 31 March 2010) a year ago. The companys higher sales were primarily on account of positive sales growth across all geographical regions. The company reported a strong increase in operating income of 56.8% to JPY137.2bn (USD1.65bn) over JPY87.5bn (USD944.4m) in the previous financial year. The company more than quadrupled its net income to JPY69.6bn (USD840.4m), compared with JPY16.6bn (USD179.1m) during the same period last year. During the year, the company reported positive sales growth in both the domestic and overseas markets. Aisins sales in Japan saw a moderate increase of 5.2% to JPY1.58trn (USD19bn). However, other regions reported a significant rise primarily due to global recovery in the automotive production. In the overseas markets, the company reported a 13% increase in sales to JPY247.7bn (USD2.98bn) in North America, 24.7% in Europe to JPY167.3bn (USD2.01bn) and 31.9% in Asia and Other regions to JPY257.6bn
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(USD3.1bn). The company does not disclose its country specific sales therefore its sales in India could not be confirmed. Year 2011 2010 2009 2008 2007 Sales (JPYm) 2,257,43 6 2,054,47 4 2214,492 2,700,40 5 2,378,61 1 Sales (USDm) 27,240.7 22,163.2 22,761.8 27,196.8 20,170.4 Operating Income (JPYm) 137,266 87,546 (3,489) 180,484 131,034 Net Income (JPYm) 69,643 16,605 (25,149) 91,654 66,889 R&D Expenditure (JPYm) 111,430 101,102 115,994 115,330 103,749 No. of Employees 74,671 73,213 73,201 73,500 66,300
Year 2011 2010 2009 2008 2007
Operating Income (USDm) 1,656.4 944.4 (35.8) 1,817.7 1,111.2
Net Income (USDm) 840.4 179.1 (258.5) 923.1 567.2
R&D Expenditure (USDm) 1,344.6 1,090.7 1,192.2 1,161.5 879.8
No. of Employees 74,671 73,213 73,201 73,500 66,300
Outlook Aisin Seiki is strengthening its presence in Brazil, Russia, India and China (BRIC) to support its customers including Toyota. The Japanese automaker has been strengthening its presence in these countries in order to tap high growth potential in the automotive industry. For example in India Toyota established its second manufacturing plant near its first plant in Bidadi, near Bangalore, Karnataka. The automaker is preparing to play a bigger role after its new compact and entry level sedan Etios received strong response from the customers. The company is considering starting exporting the model to South Africa from March 2012. However, Aisin is not only targeting Toyota but also other automakers. Therefore the company is setting up one of the two new proposed plants in Rohtak, Haryana to serve its customers in northern India. The northern part of the country boasts presence of Honda and Suzuki who have been the companys traditional customers in the global markets, including in Japan. Aisin Seiki has played a very limited role in India so far. However, the company has financial strength, technological capabilities and product lines which could help it to enter the Indian automotive market. Although it is difficult to predict how aggressive Aisin Seiki would be regarding its India expansion plans, the company is all set for a greater presence in the Indian automotive market in coming years.
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Alicon Castalloy
Aluminum castings and machined components
Address Alicon Castalloy Limited Gate No. 1426, Shikrapur Shirur, Pune - 412208 Maharashtra India Tel: +91 2137 677 100 Fax: +91 2137 677 130 Website: http://www.alicongroup.co.in/ Senior Officers Shailendrajit Rai, Managing Director Rajeev Sikand, Group CEO Vimal Gupta, CFO Products Compressor housing, crankcase, cylinder heads, EGR valves, intake manifolds, oil sump, rack housings & CAC tanks, support brackets Plants India (2): Haryana, Maharashtra Sales INR3.2bn (USD70.1m, 31 March 2011) (Year to 31.03.2011 ) Recent developments Corporate strategy Alicon Castalloy has a strong market presence in aluminum castings in India. The company is now working on expanding its international presence. As part of the expansion strategy, the company acquired Illichmann Castalloy business in Austria and Slovakia in 2010. The acquired business supplies aluminum casting products to European automakers. The move is expected to allow Alicon to expand its array of offerings to the European automotive market. Further, the company is also expected to gain from the technological expertise of Illichmann which will help the Indian owner to create new solutions for the domestic market. Alicon is witnessing a surge in demand for its products. In an attempt to tap the increasing demand, the company is expanding its production base in India with plans to open up two new plants one in Pantnagar, Uttarakhand and another in Bangalore, Karnataka (both in India). With this initiative, Alicon is preparing itself well in advance to meet the increasing demand from its customers. In financial year 2011, the company invested INR327m (USD7.2m, 31 March 2011) in capacity expansion. In 2010, Alicon demerged its unprofitable alloy wheels division into a separate company, Enkei Wheels India Ltd. The business unit was facing stiff competition from cheap imports from the China. The demerger is expected to help the company focus on its core castings business and provide more efficient solutions for its customers. Alicon is focusing on diversification to reduce its overdependence on the automotive industry. The company is looking at the possibility of supplying aluminum casting products to non-automotive sector such as agriculture, power, locomotive and industrial equipment among several others. The company expects demand for aluminum casting in non-automotive industry to record strong growth driven by expected strong investment in infrastructure like roads, railways and power generation. This is expected to reduce the companys dependence on volatile demand in automotive industry.
Alicon Castalloy, formerly known as Enkei Castalloy, is a supplier of castings and machined components for the automotive industry. The company manufactures cylinder heads, EGR Valves, intake manifolds and support brackets.
Alicon Castalloy is the flagship company of the Alicon Group. Apart from Alicon Castally, the group has other subsidiaries including Atlas Castalloy, Silicon Meadows Design, Silicon Meadows Engineering and Illichmann Castalloys business in Austria and Slovakia. The company, formerly known as Enkei Castlloy, is a joint-venture between Rai and Associates and Japan-based Enkei Corporation, formed in 1990. Earlier, Alicon classified its business into two segments, namely castings and wheels. However, the company demerged its wheels business in 2010 into a separate company called Enkei Wheels India Limited. Thus, the company operates its business through single segment-castings. Alicon Castalloy operates two plants in India which are located at Shikrapur near Pune in Maharashtra and Gurgaon, Haryana. The company is planning to set up its third plant in Pantnagar in Uttarakhand. The company is also considering its fourth plant in Bangalore, Karnataka. Alicons domestic customers include Ashok Leyland, Bajaj Auto, Eicher, Hero MotoCorp, Honda Motorcycle & Scooter, Honda Siel, Mahindra & Mahindra, Maruti Suzuki, Royal Enfield and Tata Motors. The company also supplies to global automakers including Audi, BMW, Fiat, Toyota and Volkswagen. In addition, the company supplies to some leading tier one suppliers such as Behr, Bosch, Eaton, Haldex, Knorr- Bremse, Man + Hummel, Sona Group and ZF.
Employees
NA
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Acquisitions In May 2010, Alicon Castalloy acquired Illichmann Castalloy GmbH (Austria), and Illichmann Castalloy s.r.o (Slovakia). The acquisitions have been made through a special purpose vehicle (SPV), Alicon Holdings, set up in Austria. The companies now operate as subsidiaries of Alicon and are engaged in manufacturing aluminum casting products and supply to automobile and engineering OEMS in the European market. Financial Overview In the financial year ended 31 March 2011, Alicon Castalloy recorded consolidated sales of INR3.2bn (USD70.1m, 31 March 2011). The company recorded profit before tax of INR197.8m (USD4.3m) and net profit of INR153.4.7m (USD3.4m). For the first time Alicons consolidated performance included revenues from its acquired business of Illichmann Castalloy. Therefore no comparison of financial performance could be done. On a stand-alone basis, Alicon Castalloy reported a 23.8% increase in sales of INR2.6bn (USD56.9m) compared with INR2.1bn (USD47.2m) in the previous financial year. The company benefited from strong demand for aluminum casting components in India and in the overseas markets. Strong sales led the company to report a 12.8% increase in profit before tax to INR185.9m (USD4.1m) compared with INR164.8m (USD3.6m). Alicon Castalloy concluded the financial year with net profit of INR 146.3m (USD3.2m) over INR134m (USD3m) in the previous financial year. Years 2011 2010 2009 2008 2007 Years 2011 2010 2009 2008 2007 Net Sales (INRm) 3,184.4 2,121.1 3,027.4 3,251.8 2,296.1 Net Sales (USDm) 70.1 47.1 58.0 81.5 52.8 Profit Before Tax (INR) 197.8 164.8 1,123.8 63.7 143.0 Profit Before Tax (USD) 4.3 3.6 21.5 1.6 3.3 Net Profit (INRm) 153.4 134.0 114.2 66.0 118.3 Net Profit (USDm) 3.4 3.0 2.2 1.6 2.7
Outlook Alicon foresees tremendous growth potential for aluminum casting components in coming years. Automakers worldwide are increasingly using greater amount of lightweight aluminum casting products in place of iron casting components to reduce overall weight of vehicle in order to meet tightening emission regulations. Alicon has undertaken several restructuring measures, including the spinning of its loss-making wheels business into a separate company. The company is now in a better position to optimally utilise its resources in its core business of aluminum castings. This is expected to help the company to improve its margin in coming years. The acquisition of Illichmann could prove a milestone in the corporate history of Alicon. The takeover is expected to not only expand its international presence but also provide access to premium automakers in the Europe market. Although the Indian automotive industry is witnessing some moderation in vehicle demand, Alicon is confident of growth potential in the medium to long term. The company is preparing itself to meet expected surge in demand for aluminum casting components both in India and in the overseas markets through investing incapacity expansion including setting up two new plants. Overall the company is expecting its sales to reach INR10bn (USD220.2m, 31 March 2011) by financial year 2016.
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Amalgamations Group
Engine components, batteries, clutches
Address Amalgamations Private Limited 861/862, Anna Salai Chennai- 600 002 Tamil Nadu India Tel: +91 44 2858 4918 Fax: +91 44 2858 3179 Internet: http://www.amalgamationsgroup.co.in Senior Officers A Krishnamoorthy, Vice Chairman S Ramanujchari, Director Products Battery, bushing, brake systems, clutch, clutch assembly, clutch release bearing assembly, crankshaft, cylinder heads, cylinder blocks, cylinder liners, engine bearings, oil pumps, pins, pistons, rings, water pumps Plants India: over 50 plants spread across Himachal Pradesh, Madhaya Pradesh, Karnataka, Tamil Nadu, Uttrakhand Sales Group: INR70bn (USD1.5bn, 31 March 2011) (Year to 31.03.11) Employees Group: 15,000 (March 2011)
The Amalgamations Group is one of largest component suppliers in India. The Groups diverse operations include automotive component manufacturing, trading & distribution, plantation and services. In automotive the company manufactures components for engines and transmissions.
The Amalgamations Group was established as a holding company for six companies in 1938. The holding company now has more 47 companies. Simpsons & Company: manufactures diesel engine products with power ranging from 20 to 110 bhp. The company has three manufacturing facilities; two in Chennai and one in Kumbakonam, all in Tamil Nadu (India). For its diesel engines, the company does in-house production of components such as crankshafts, cylinder heads and cylinder blocks. India Pistons: supplies cylinder liners, pins, pistons and rings. The company has two manufacturing units located in Sembiam and Sengundram, near Chennai, Tamil Nadu (India). The Sembiam plant has annual production capacity to produce 2.5 million pistons while Sengundram can make 30 million ring blanks a year. The company set up IP Pins & Liners (IPPL) which makes gudgeon pins for India Pistons. IP Rings: makes specialty steel piston rings and several transmission components using orbital cold forming technology. The company has technical collaboration and equity participation with Japan-based Nippon Piston Rings. IP Rings supplies Ashok Leyland, Eicher Motors, Ford, Hyundai, Mahindra & Mahindra, Maruti Suzuki, Simpsons, Tata Motors and TVS Motors. Amalgamations Valeo Clutch: is a joint-venture between the Amalgamation Group and Valeo. The company is a major supplier of clutch assembly and clutch release bearing assembly for threewheelers, passenger cars, commercial vehicles and tractors. The company operates two manufacturing facilities near Chennai, Tamil Nadu (India). It supplies to Ford India, Hyundai India, Mahindra & Mahindra, Maruti Suzuki, TAFE and Tata Motors. Bimetal Bearings: supplies engine bearings, bushings and thrust washers to passenger cars, commercial vehicles and tractors. The company has set up its own alloy powder plant, copper lead strip sinter lines, aluminum alloy strip cladding line thin-wall and thickwall bearing manufacturing lines, alloy plating lines and bushing & thrust washer lines. It operates four manufacturing plants; two in Chennai and one each in Coimbatore and Hosur, all in Tamil Nadu (India). Alpump Limited: supplies water pumps and oil pumps for passenger cars, commercial vehicles, tractors and dumpers. The company supplies 75% of its output to OEMs and the remaining 25% to aftermarkets. Kuduma Fasteners: manufactures fasteners and cold-headed components for automotive and industrial applications. The company supplies its products to tier one suppliers, such as Bosch, as well as to OEMs including Force Motors. In addition, the company exports its products to US and Middle-East markets. AMCO Batteries: supplies polypropylene batteries for two-wheelers, passenger cars, commercial vehicles and tractors. The company operates a manufacturing facility in Bangalore, Karnataka (India). The company has a joint-venture with France-based Saft SA, called AMCO Saft India Limited. The JV supplies batteries to defence, oil, thermal power and transportation sectors. Mahle IPL: a joint-venture between Amalgamation Group and Germany-based Mahle GmbH. The company manufactures pistons for on-highway applications. The company has a manufacturing
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facility near Chennai, Tamil Nadu (India) with annual production capacity of 4.2m pistons per year. Amalgamations Repco: manufactures clutch and brake systems for passenger cars, commercial vehicles and tractors. The company now also has erstwhile India Pistons Repco which is engaged in the production of flywheel starter ring gears. India Pistons Repco operates two manufacturing facilities near Chennai, Tamil Nadu (India). Shardlow India: manufactures precision forgings for crankshafts, axle beams, stub axles, gear blanks and steering arms. The company operates two forging units one each in Chennai and Hosur, both Tamil Nadu (India). Shardlow India supplies to Ashok Leyland, Kirloskar Oil Engines, Simpsons, TAFE, Tata Motors and defence establishments. Stanadyne Amalgamations: is a joint-venture with Stanadyne Corporation, USA. The JV manufactures single cylinder pumps and injectors in Maraimalainagar near Chennai, Tamil Nadu (India). The company supplies to both domestic markets and overseas markets. TAFE- Engineering Plastics Division: manufactures high precision tools and custom-moulded engineering plastics from its two facilities in Bangalore, Karnataka and Maraimalainagar, Tamil Nadu (both in India). TAFE Engineering Plastics Division supplies to domestic clients such as GM, Hindustan Motor, Iveco, Kyoto, Tata Johnson Controls, Lear, Tata Toyo Radiators, Toyota Kirloskar Motors and Visteon.
Overall, Amalgamation Group has 47 companies. The Group operates around 50 manufacturing plants in India and employs over 15,000 people. The Group caters to both original equipment (OE) market and aftermarket. Amalgamations major customers include all major OEMs operating in the country. In addition, Group exports its products. The company has maintained its exports at about 15% of sales over the last many years. Recent Developments Corporate strategy Amalgamations Group has a strong presence in automotive engine and transmission components in India. Over the years the Group has expanded its product lines through entering into several joint-ventures and technical alliances with major global suppliers. These strategic alliances have given the Amalgamation Group of companies access to technologies and customers while offering its extensive manufacturing and supply expertise in the local market. In over 70 years, the Amalgamations Group has developed a strong relationship with almost all the automakers in the country, which helped the global automakers speed up their localisation programmes. Joint-Venture In December 2007, Amalgamation Groups company, India Pistons entered into a joint-venture agreement with Mahle, to make pistons for Euro IV compliant diesel and petrol engines. The company hived off its facility at Maraimalai Nagar in Chennai, Tamil Nadu (India) to support new entity where the two partners hold equal equity. New Products Development: The Amalgamation Group has technical collaboration with several global suppliers. IP Rings has technical alliance with Nippon Piston Ring Co. Ltd, one of the major leaders in piston ring technology. Bimetal Bearings has a technology transfer agreement with Daido Metal Co.
Financial Overview Amalgamation Group is a family-owned private company. Therefore, the company does not disclose its financial results. The Groups sales were estimated to be around INR70bn (USD1.5bn) in 2011. Outlook The Amalgamations Group has an extensive product portfolio and strong technology partners which help it to secure supply contracts especially when OEMs use a follow-through source approach. The diverse product portfolio is expected to help the Indian component manufacturer to secure
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supply contracts from the new automakers who have recently invested in new plants in India. The Group, a major powertrain component supplier, is closely monitoring development in the area of vehicle emissions in India. In 2010, the Indian government implemented BSIV emission standards, which are equivalent to Euro IV, in the 13 major cities in India, and is gearing up to introduce BSIV throughput the country. In order to tap potential demand by automakers operating in India, Amalgamation entered into an agreement with Germanybased Mahle. The JV makes BS-IV compliant pistons for diesel and hybrid engines. This is expected to increase demand for pistons which comply with the stringent emission norms and help the JV record strong growth in coming years.
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Amtek Auto
Engine, suspension and transmission parts
Address Amtek Auto Limited 3, Local Shopping Centre Pamposh Enclave, G.K.-I New Delhi-110 048 India Tel: +91 11 4234 4444 Fax: +91 11 4234 4000 Internet: http://www.amtek.com Senior Officers Arvind Dham, Chairman John Flintham, Managing Director & CEO DS Malik, Managing Director VK Pabby, Managing Director Gautam Malhotra, Joint Managing Director Aditya Malhotra, Director RL Sehgal, Director Avijit Banerjee, Director Products Axle housing, camshaft, clutch case, connecting rod, crankshaft, cylinder block and head, flywheel, front axle beams, intake manifold, ladder frame, ring gear, steering knuckles, sumps, turbocharger, transmission case and forks, wheel hubs Plants India: 40 manufacturing plants across Gujarat, Haryana, Himachal Pradesh, Madhya Pradesh, Maharashtra, Rajasthan, Tamil Nadu and Uttarakhand Outside India: Germany, UK (2) Sales Amtek Auto: INR51.1bn (USD1.1bn, 30 June 2011) (Year to 30.06.11) Employees Group: 3,500 (2011)
Amtek Auto is the flagship company of the Amtek Group which is a leading supplier of engine, transmission and suspension components in India. The company is also engaged in machining and sub-assemblies for automotive applications. The Amtek Group generated 78% of its financial year 2011 sales from the automotive business.
The Amtek Group started operations in 1987 through supplying connecting rods to Maruti Suzuki. Since then the Group has grown to become one of the major integrated components suppliers in India. Amteks business is broadly organised into automotive and non-automotive segments. The automotive segment is further categorised in four operating divisions: Forging Division, Iron Casting Division, Aluminium Casting Division and Automotive Machining Divisions. In the non-automotive segment, Amtek Groups business is organised into Transportation Division and Specialty Vehicle Division. The Amtek Group operates 43 manufacturing facilities worldwide of which 40 are in India across Gujarat, Haryana, Himachal Pradesh, Madhya Pradesh, Maharashtra, Rajasthan, Tamil Nadu and Uttarakhand. Outside India, the company has manufacturing presence in Germany and the UK. In financial year 2011, the Amtek generated 78% of its sales from the automotive segment and the remaining 22% from non-automotive. Amtek Auto: is the flagship company of the Amtek Group. The company has strong presence in forging, grey and ductile iron casting, gravity and high-pressure aluminum die casting and machining and sub-assembly. Amtek Crankshaft India Limited, which operates as a subsidiary of Amtek Auto, is a supplier of crankshafts for the automotive industry. Amtek India: is a major supplier of iron cast automotive components such as connecting rod assemblies, cylinder blocks, flywheel assemblies and turbo charger housing. In financial year 2010-11 Amtek Auto acquired 85,298,290 fully paid up shares representing 61.64% of the total paid up equity share of Amtek India. Ahmednagar Forgings: is the second largest supplier of forged components, cold forged parts and high tensile fasteners in India. Amtek Auto has a 54.95% equity stake in Ahmednagar Forgings.
In addition, the Amtek Group has entered into several joint-ventures (JVs) with leading global suppliers such as Magna International and Neumayer Tekfor for machining, and Sumitomo Metals for forging. The Amtek Group has a very diverse customer portfolio which includes twowheelers, three-wheelers, passenger cars and light commercial vehicles (LCVs) and heavy commercial vehicles (HCVs). The companys OEM customers include Ashok Leyland, Aston Martin, BMW, CNH, Daimler, Eicher, Fiat, Force Motor, Ford, JCB, John Deere, Hindustan Motors, Hyundai, JaguarLand Rover, Mahindra & Mahindra, Maruti Suzuki, Nissan, SML Isuzu, Tata Motors, Toyota and Volkswagen. In addition, the company supplies to major tier one suppliers including BorgWarner, Cummins, Knorr-Bremse, Sona Group, and ThyssenKrupp. Recent Developments Corporate strategy Amtek Auto is focusing on expanding its business through both organic and inorganic routes to achieve sales of USD3bn by 2015, compared with USD1.1bn in the financial year ended 30 June 2011. The company is planning to take advantage of the recent slowdown and is looking to acquire cheap assets in India and Europe. As of December 2011, the company had strong cash reserves of INR15bn (USD275.1m, 31 December 2011) which the company intends to use in buying assets which strengthen its
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presence in forging, machining and casting business. In addition to acquisitions, Amtek is strengthening its presence through investing in new plants as well as ramping capacity at its existing facilities. In September 2011, the companys JV with Sumitomo Metal Industries, SMI Amtek Crankshaft announced an investment of INR1bn (USD20.1m, 30 September 2011) in setting up a second forging pressline at its manufacturing plant in Dharuhera, Haryana (India). The JV formed in 2009 had already invested INR1bn (USD21m) in the new manufacturing plant to produce and sell forged crankshaft for automotive applications in India. Earlier in March 2010, the company announced an ambitious project, involving a total investment of INR158.2bn (USD3.5bn, 31 March 2010) to set up an auto-park in Cuttack, Odisha (India) which will have a ferrous foundry, steel fabrication plant, alloy steel plant, open die forging plant, aluminium die-casting plant, special fastener plant, alloy steel plant and ring gear blank plant. The auto-park will also have a steel plant with a production capacity of two million tonne per annum (mtpa) and a 500MW power plant. Amtek is expecting to complete this project over three years. Amtek is diversifying its presence in non-automotive business with particular focus on transportation and special vehicles. During financial year 2011, the company entered into a joint-venture (JV) with American Railcar Industries to manufacture railway wagons. In January 2011, the company entered into another JV with Korea-based Autech Corporation to make vehicles for defence and other specialised sectors. The JV is setting up a special vehicle manufacturing plant in Dharuhera, Haryana (India) which will have annual production capacity of 10,000 special vehicles for defence and other specialised sectors. In November 2011, Amtek entered into another JV with Israel-based Enertech Management to develop and produce advanced electronic systems, test systems, simulators and electronic systems for military applications. Acquisitions In November 2007, Amtek acquired UK based, Triplex Ketlon Group for an undisclosed sum. In 2006, Triplex Kelton recorded sales of USD152m. In June 2007, Amtek acquired JL Frenchs UK based HPDC Aluminum operations. Acquired operations include designing, testing, rapid prototyping, precision machining and assembly facilities. In February 2006, Amtek announced 100% acquisition of UK-based Sigma Cast Group which is one of the largest suppliers of turbocharger components in the world. The Sigma Cast group has 100% ownership of the subsidiary Sigma Cast Iron. This acquisition helped Amtek add customers such as GM, Ford, Land Rover, CNH and Dana. Joint-Ventures In May 2009, Amtek entered into a joint-venture (JV) agreement with Japan-based Sumitomo Metals Industries (SMI) to produce and sell forged crankshafts for automotive applications in India. The JV, SMI Amtek Crankshaft, is 50% owned by Amtek, 40% by SMI and 10% by Sumitomo Corporation, which is a global partner of SMI for the crankshaft market. The JV invested INR1bn (USD21m, 31 May 2009) in a new manufacturing plant in Dharuhera, Haryana (India), equipped with a 4,000-tonne forging press line. The plant had initial production capacity of 800,000 units of crankshafts a year. In August 2008, Amtek formed a joint-venture with Michigan (US)-based FormTech Industries to establish an automotive forgings manufacturing unit. The joint facility will manufacture Hatehur Hot Forgings for automotive applications in India and Europe. While Amtek has a 51% stake in the equity the rest is with the US partner. In November 2007, Amtek entered into a technical alliance with Teksid to manufacture aluminum cylinder blocks for Suzuki Powertrain, Tata and Fiat. The technical collaboration gives Amtek access to the technology for manufacturing 1.3L small diesel engine blocks in India. Amtek is a single source supplier for these engine blocks for automakers including MarutiSuzuki, Tata Motors and Tata-Fiat. In October 2007, Amtek Auto entered into a JV agreement with Magna International to manufacture and supply powertrain systems both to the domestic and export markets. The 50:50 JV started powertrain systems supply in the first half of 2008. The JV is one of the nine strategic business units (SBU) of the company, which will take a stronger foothold in India. In April 2007, Amtek formed a JV with Belgium based VCST to
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manufacture gears and shafts. The JV operates a manufacturing facility in Pune, Maharashtra (India) which has initial production capacity of 1.5 million components primarily for export markets. Investments In September 2011, SMI Amtek Crankshaft, the joint-venture between Japan-based Sumitomo Metals Industries and Amtek Group, announced that it was setting up its second forging press line at its manufacturing plant in Dharuhera, Haryana (India) to meet surging demand for crankshafts in the Indian automotive industry. The plants annual capacity will increase to 2.2 million units compared with the current capacity of 0.8million units. The company is also setting up 5,000 tonnes high speed forging press line. The JV is investing INR1bn (USD20.1m, 30 September 2011) to ramp up capacity. The new press line will become operational in November 2012. In March 2010, Amtek Metal & Mining Limited, a group company of Amtek Auto signed a memorandum of understanding (MoU) with the government of Odisha to set up an auto park in Tangin, near Cuttack with investment of INR158.2bn (USD3.5bn, 31 March 2010). The project involves setting up a ferrous foundry, steel fabrication plant, alloy steel plant, open die forging plant, aluminium die-casting plant, special fastener plant, alloy steel plant and ring gear blank plant. The auto-park will also have a steel plant with a production capacity of two million tonne per annum (mtpa) and a 500MW power plant. The project will spread over 2,500 acres, of which 550 will be utilised for the autopark where Amtek will invest INR20.5bn (USD455.3m) in phases. The company is planning to complete the project in three years and is expected to create direct and indirect employment for 33,000 people. Contracts In January 2008, Tata Motors selected Amtek Auto as a supplier for engine and suspension components for Nano. The company supplies engine and suspension components including balancer shafts, crankshafts, connecting rods, cylinder block and head, front and rear brake drums, spindles and steering knuckle to Tata ultra-cheap small car. In 2007, Suzuki Powertrain and Tata Fiat selected Amtek to be the sole supplier of aluminum engine blocks for the 1.3L Fiat diesel engine production programmes. In 2005, Cummins awarded Amtek with a contract to supply ring gears and assemblies for their heavy diesel engine manufacturing operations. In the same year, Detroit Diesel signed a long-term global sourcing contract with Amtek to supply eight varieties of ring gears for their engine manufacturing operations. Financial Overview In the financial year ended 30 June 2011 Amtek Auto reported a 38.5% increase in consolidated sales to INR51.1bn (USD1.1bn, 30 June 2011) compared with INR36.9bn (USD794m, 30 June 2010) in the previous year. The company benefited from strong growth in vehicle sales in India which led its customers to report record growth in production. Higher sales led Amtek Auto to record a 21.1% increase in profit before tax (PBT) to INR4.7bn (USD104.6m) over INR3.9bn (USD84.4m) in the previous financial year. The companys earnings remained under pressure amid high raw material prices throughout the financial year. Amtek Auto concluded the financial year with net profit of INR2.6bn (USD57.1m) over INR2.4bn (USD51.7m) in financial year 2010. Amtek India Limited, in which Ametk Auto acquired a 61.64% equity stake during the financial year, reported a 38.5% increase in consolidated sales of INR14.4bn (USD317.1m) compared with INR10.4bn (USD223.7m) in the previous year. The company reported PBT of INR1.6bn (USD35.2m) up 45.4% over INR1.1bn (USD23.7m) in the previous financial year. Amtek India posted net profit of INR1.1bn (USD24.2m) compared with INR787.3m (USD16.9m) in financial year 2010. Another listed subsidiary, Ahmednagar Forging, in which Amtek Auto has a 54.95% stake, reported a 40.7% increase in sales to INR9.4bn (USD206.4m) compared with INR6.6bn (USD143.1m) in the previous financial year. The company recorded PBT of INR1.5bn (USD33m), up 61.8% over INR941.3m (USD20.2m) in the preceding year. The company concluded the financial year with net profit of INR1.1bn (USD238.1m) an increase of 68.8% from
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INR971.3m (USD20.9m) in 2010. Years Sales (INRm) Profit Before Tax (INRm) Net Profit (INRm)
2011 2010 2009 2008 2007
51,119.2 36,908.5 34,386.2 46,567.9 37,206.1
4,750.9 3,924.0 2,753.1 6,338.2 5,757.8
2,594.7 2,404.9 1,727.6 4,274.2 4,085.3
Years
Sales (USDm)
Profit Before Tax (USDm)
Net Profit (USDm)
2011 2010 2009 2008 2007
1,125.6 794.0 706.9 1,086.8 913.4
104.6 84.4 56.6 147.9 141.3
57.1 51.7 35.5 99.7 100.3
Outlook Amtek Auto has recorded strong growth in the past few years, driven by excellent performance by its customers in India, including Maruti Suzuki for which it is a sole supplier for several components. In addition to Maruti Suzuki, the company is also a single source supplier for other automakers such as Tata Motors. The company hopes to maintain its growth momentum and has set a goal to reach a turnover of USD3bn by 2015. Amtek is investing in new capacities as well as scouting for few acquisitions in order to reach that goal. However, Amtek believes that the company has already created sufficient capacity to reach turnover of USD3bn without much capital expenditure and acquisitions. Amtek also hopes to become debt-free by 2015. The company intends to pay a major portion of its external commercial borrowing (ECB) between 2013 and 2015. Amtek brought down its debt to about INR30bn (USD660.5m) after it redeemed USD250m foreign currency convertible bonds (FCCBs) in June 2011. The company has taken various strategic initiatives to diversify its presence in non-automotive businesses, which account for 22% of its sales. Amtek has entered into several joint-ventures including American Rail Car, Autech and Enertech to provide impetus to its diversification initiative. The company expects these initiatives to not only open new sources of revenue but also to help in creating a balanced product portfolio in the medium to long term.
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Anand Group
Chassis, powertrain, safety
Address Anand Automotive Limited 1 Sri Aurobindo Marg, New Delhi, 110016 India Tel: +91 11 2656 4542 Fax: +91 11 2686 6040 Internet: http://www.anandgroupindia.com Senior Officers Deep C Anand, Chairman Deepak Chopra, Group CEO Mahendra Goyal, Group CFO Jagdeep Oberoi, Group Controller Sandeep Balooja, President, Business Development Manoj Menon, Vice-President, Strategy and Business Charanjeet Singh, Vice-President, Finance, Taxation and Accounts Vish Iyer, Deputy-General Manger, Corporate Planning Manoj Kolhatkar, Managing Director, Gabriel India Sunil Kaul, President & COO, Behr India Subhash Anandan, General Manager & Head, Faurecial Emission Control Technologies S Binu, Vice-President & COO, Haldex India V Madhavan, Deputy Managing Director, Mando India Ramneek Jain, Vice-President, Operations, Mahle Filter System India T Iwane, Takata Inida K Raghavan, Valeo Fricition Materials India T Iwane, Head, Takata India MS Shankar, Vice President and COO, Victor Gasket India Arul Kumar, COO, Spicer India SC Korde, VP & COO, Perfect Circle India Vidhan Choubey, Vice President & COO, Henkel Teroson Inida Sumit Bhatnagar, COO, Chang Yun India PKSV Sagar Camfil Far Air Filter India Products Adhesives, airbag driver, air brake components, automotive filters, axles and propeller shafts, car care products and coolants, climate control, coatings, engine bearings, exhaust systems, friction material, gaskets, hydraulic brakes, piston rings and castings, shock absorbers, sealant, seatbelt, steering wheels, struts and front forks, synchroniser rings, vibration monitoring systems
Anand Group is one of the leading manufacturers of automotive components and systems in India. The company supplies a diverse range of components to automotive industry through its several joint-ventures.
Anand Group entered the auto component business in 1961 through establishing Gabriel India, a joint-venture with Gabriel (USA) to manufacture shock absorbers. In the past five decades Anand has emerged as one of the major component suppliers in India, with 19 companies spread across 46 facilities in 16 locations in nine states, employing 8,000 people. The Group has a total of 14 joint-ventures and eight technical licences. Some of the major companies of the Anand Group are: Gabriel India: is the flagship company of the Anand Group. The company is a major supplier of ride control products in India. Gabriel India produces shock absorbers, strut and front forks at its six manufacturing plants in India, located in Haryana, Himachal Pradesh, Madhya Pradesh, Maharashtra and Tamil Nadu (all in India). The company has a combined annual production capacity of 21m shock absorbers and struts and 2.7m front forks. The company supplies to all major automakers operating in India including Ashok Leyland, Eicher, Fiat, Force Motors, Ford, GM, Hindustan Motors, Hyundai, Mahindra & Mahindra, Maruti Suzuki, Mitsubishi Motors, SML Isuzu, Tata Motors and Toyota. Faurecia Emission Control Technologies: is a joint-venture with Emcon Technologies, which was acquired in 2010 by Faurecia. The JV manufactures exhaust muffler assemblies, catalytic convertors, instrument panel reinforcement assemblies and door side impact beams. The company has manufacturing plants at Bangalore, Karnataka and Chennai, Tamil Nadu (both in India). The JV supplies to Ford India, Toyota, International Tractors and Caterpillar India. Mahle Filter System India: is a JV with Germany-based Mahle Filter System GmbH to produce air, oil, fuel and hydraulic filter for automotive applications. The company operates four manufacturing plants, two in Gurgaon, Haryana, and one each in Pune, Maharashtra and Parwanoo, Himachal Pradesh (all in India). The JV supplies to Ashok Leyland, Caterpillar, Force Motors, Ford, GM, Honda, Mahindra & Mahindra, Maruti Suzuki, Mitsubishi Motors, SML Isuzu, Tata Motors and Toyota. Valeo Friction Materials India: a JV with France-based Valeo to produce water-based clutch facings free from asbestos, lead, organic solvents, aramid fibre and ceramic fibre. The JV operates a manufacturing plant in Chennai, Tamil Nadu (India) which has an installed capacity of six million facings a year. Valeo Friction supplies to most OEMs through various clutch manufacturers like Amalgamations Valeo, LuK India, Ceekay Daikin, Mahindra Sona, Amalgamations Repco, Clutch Auto, Jay Hind Industries, Gujarat Setco, Automobile Products of India, Hind Auto, Andhra Sinter and Welset Engineers Behr India: is a JV with Germany-based Behr Group to manufacture airconditioning systems, engine cooling components and heat exchangers. The JV serves its domestic and offshore client base from its plant at Chakan near Pune, Maharashtra (India). The company also has an Export Oriented Unit (EOU) for making heat exchangers and tubular components. The establishment also acts as a global sourcing office for Behr sourcing parts like wiring harnesses, exhaust gas recirculation (EGR) parts, gravity die castings, pressure die castings and rubber parts. Behr India supplies to OEMs like Mahindra & Mahindra, Tata Motors, Ashok Leyland, Eicher Motors, Tata Cummins, Renault and GM. The company also exports to Behr set-ups in Germany, France and America. Spicer India: is a JV with Dana Corporation to produce axles, drive shafts and universal joints. The company operates five facilities located in Chakan, Satara, both in Maharashtra; Jodalli, Karnataka; Pantnagar, Uttarakhand and a 100% EOU at Hosur, Tamil Nadu (all in India). The
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Plants India (44 ): Gujarat, Haryana, Himachal Pradesh, Karnataka, Madhya Pradesh, Maharashtra, Rajasthan, Tamil Nadu, Uttarakhand Sales Group: INR44bn (USD965m, 31 December 2010) Employees Group: 8,000 (2010)
JV supplies to Ashok Leyland, AMW, Caterpillar, Force Motors, Ford, GM, Mahindra & Mahindra and Tata Motors. The company also exports to Toyota, Ford, GM, Chrysler and Hino through Danas network. Victor Gaskets: supplies gaskets for automotive and non-automotive application in India from its plant in Pune, Maharashtra (India). The company operates a manufacturing plant in Chakan, near Pune, Maharashtra (India) and supplies to Ashok Leland, Cummins, Caterpillar, Ford India, GM, John Deere, Mahindra & Mahindra, New Holland Tractors and Tata Motors. The company also exports to OEMs such as Lister Petter (UK) and Iveco (Italy) and aftermarket operations of Clevite Engine Parts, Holden Spare Parts Organisation (Australia). Chang Yun India: is a JV between South Korea-based CY Myutec and the Anand Group formed to produce synchroniser rings for automotive applications. The JV has a facility in Gurgaon, Haryana (India) with an installed capacity of 5.5m rings per annum and supplies to Maruti Suzuki and Hyundai Motors India. Mando Brake Systems India: was established in collaboration with South Korean supplier Mando Corporation. The company produces brake systems with a production facility at Chennai, Tamil Nadu (India). The company supplies to Hyundai India, Ford India, Mahindra & Mahindra and GM. Henkel Teroson India: is a JV between the Anand Group and Henkel Teroson GmbH, a wholly-owned subsidiary of Germany-based Henkel KGaA. The JV produces adhesives, sealants and coatings. The company has manufacturing plants at Gurgaon, Haryana; Parwanoo, Madhya Pradesh; Pune, Maharashtra and Chennai, Tamil Nadu (all in India). The JV supplies to Ford India, Hindustan Motors, Honda Siel, Hyundai India, Maruti Suzuki, Mahindra & Mahindra, Toyota Kirloskar Motors and Tata Motors. Haldex India: is a JV between the Anand Group and Haldex AB to produce manual and automatic slack adjusters for air brakes of commercial vehicles. Haldex India has two facilities at Nashik, Maharashtra (India) and supplies to Ashok Leyland, Eicher Motors and Tata Motors. The company also exports to Haldex group companies globally. Perfect Circle India: supplies piston rings and castings. The company operates a casting plant, a piston ring machining plant and a plate machining plant in Nashik, Maharashtra (India), established in collaboration with Dana Corporation. The company also has a technical licence with Mahle Engine Components (USA). Perfect Circle India supplies to Ashok Leyland, Cummins and Mahindra & Mahindra. The company is also the leading exporter of piston rings in India. Takata India: is a JV between Takata Corporation and Anand Automotive. The JV manufactures safety systems components including airbags, seatbelts and steering wheels. The JV is setting up two plants one in Chennai, Tamil Nadu and the other in Neemrana, Rajasthan (India), which will supply to local OEMs.
With such a diverse presence Anand Group supplies to all major automakers operating in India. The Groups major customers include AMW, Ashok Leyland, CNH, Eicher, Fiat, Force Motors, Ford, GM, Hindustan Motors, Hyundai, Maruti Suzuki, Mahindra & Mahindra, Mitsubishi Motors, Sonalika, SML Isuzu, TAFE, Tata Motors and Toyota. The company also exports its products which account for around 14% of its sales. Recent Developments Corporate strategy Anand Group has set its financial goals to achieve USD2bn sales by 2014. In order to realise the goal the Group has decided to invest INR15bn (USD330.4m) in setting up new plants and exploring joint-ventures. In addition, the company will ramp up capacities at its existing plants. The strategic partnership has played a vital role in the growth of the Anand Group. The Group, which has 14 joint-ventures and eight technical alliances, continues to explore new JV opportunities which could further help it enter new products/markets or provide access to new technologies. In January 2012, the diversified component group announced it is looking for overseas partners as it plans to enter the electronic components segment, an area where Anand Group has no presence.
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Joint-ventures In January 2009, Anand Automotive entered into a joint-venture agreement with Takata Corporation. The JV, Takata India Private Limited, will produce safety systems such as airbags, seatbelts and steering wheels for OEMs in India. Takata will have the majority ownership in the JV while the Anand Group will initially retain a minority stake and its equity will increase later in two stages. The two partners will invest around INR2.3bn (USD46.8m) to set up two manufacturing plants, one at Neemrana, Rajasthan and one in Chennai, Tamil Nadu (India). Investments In March 2011, Anand Group announced plans to invest about INR15bn (USD330.4m, 31 March 2011) on capacity expansions over the next five years. The Group will invest in setting up new plants and joint-ventures. In addition, the company will invest in capacity expansion at its existing plants. In 2010, Gabriel India expanded capacity at its plants in Hosur, Tamil Nadu and Parwanoo, Himachal (both in India) for commercial vehicles business. The company also expanded capacity at its Khandsa plant in Gurgaon, Haryana (India) which mainly serves Maruti-Suzuki India Ltd (MSIL). In 2010, Gabriel India established a manufacturing plant in Sanand in Gujarat (India) to supply Tata Nano. In 2010, Mahle Filter System India, a JV company of the Anand Group with Germany-based Mahle Filter Systems, commissioned its second plant at Parwanoo in Himachal Pradesh (India). The plant has an installed production capacity of 22m filters per annum. The new plant will supply to Ashok Leyland, GM, Mahindra & Mahindra and Tata Motors as well as Robert Bosch. The JVs first plant is located in Pune, Maharashtra (India). In 2009, Gabriel India established an aluminium casting facility at its Chakan plant in Pune, Maharashtra (India). The facility manufactures outer tubes which are used in front forks. In November 2008, Gabriel India inaugurated a manufacturing facility in Parwanoo, Himachal Pradesh (India). The facility manufactures shock absorbers for commercial vehicles and two-wheelers, struts for passenger cars and front forks for motorcycles. The plant employs 217 people. In November 2008, Anand Automotive announced plans to invest INR6bn (US$120m, 23 November 2008) in India by 2010 as part of its expansion efforts. The Group will invest in setting up 13 plants during the following two years. The Anand Group has already started work on three plants and has secured 45 acres of land in Chennai, Tamil Nadu (India). In January 2006, Haldex India announced its plans to set up a Self-setting Automatic Brake Adjustor (S-ABA) manufacturing plant at Nasik, Maharashtra (India) with a total investment of INR100m (USD2.2m, 31 January 2006). Contracts In 2011, Gabriel India secured a contract to supply Hondas new compact car Brio. This allowed the company to become a supplier to Honda cars. In 2011, Gabriel India started supplying to Toyota Corolla Altis diesel model. In 2011, Gabriel India completed development activities for Volkswagen Polo and Vento and Skoda Fabia. The company will commence supply in 2012. In 2010, Gabriel India secured a contract to supply piston rods to Mandos plant in Chennai, Tamil Nadu (India). The company produces the components at its Khandsa plant in Gurgaon, Haryana (India). Haldex India supplies automatic brake adjusters to Ashok Leyland, Eicher Motors and Tata Motors. Behr India has been awarded supply contracts for the Renault Logan. The company has also been selected to supply to the GM Chevrolet Aveo model. Perfect Circle supplies to PSA Peugeot Citron, Europe via Dana's supply network. Spicer India exports companion flanges, differential cases, end yokes to Dana UK and USA. Victor Gaskets supplies gaskets to Ashok Leyland for the Hino Engine programme.
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Spicer is the sole supplier of axles and drive shafts for the Tata Safari, Sumo and 207 series vehicles. Spicer is the sole supplier of axles and driveshafts for the Ford Endeavour model. Spicer has an exclusive contract for axles and drive shafts for GM Tavera. Spicer meets 60% requirements of Ashok Leyland for drive shaft requirements. Spicer is the sole supplier of drive shafts and axles to ICML Rhino programme. Spicer is the sole supplier of drive shafts and axles to Hindustan Motors RTV programme. Spicer supplies front and rear axle for the Mahindra Scorpio and front axle to the Mahindra Bolero programme. Mahle Filter Systems supplies to all Maruti models. Mahle is the sole supplier of air filters to the Tata Indica programme. The company also supplies 45% of Tatas requirement of filters for trucks. Mahle is the sole supplier of oil, fuel and air filters to the Hyundai Santro programme. Mahle is the sole supplier of filter systems to Hindustan Motors. The company is also the sole supplier to Fiat India. Mando Brake Systems is the sole supplier of master booster assembly and supplies front and rear brake assembly to the Hyundai Getz programme in India. Mando supplies master booster to the Ford Fiesta programme in India. Mando also supplies front brake assembly for the Hyundai Accent programme. Mando supplies the front brake assembly, rear brake assembly and master booster for the Hyundai Santro programme.
New Product Developments Anand Group has set a target to invest 2% of its sales in research and development (R&D). The various companies of the Anand Group conduct their own R&D activities. Financial Overview Anand Group reported sales of INR42bn (USD965m, 31 December 2010) in 2010. The Group has set its goal to achieve INR90bn (USD2bn) in sales by 2014. Anand Group, a privately held concern does not publish its detailed financial results. Outlook Anand Group has emerged as one of the major component suppliers in India, thanks to its highly successful joint-ventures and technical alliances with the worlds leading suppliers who are market leader in their respective product segment. These strategic alliances have enabled the Group to cover a very broad range of auto components. Still, the Group is willing to enter into new businesses through new alliances. Recently Anand Group announced plans to enter the automotive electronics segment. The Group is scouting for an overseas partner to enter into the segment. Given increasing electronic content per vehicle worldwide, venturing into the automotive electronics segment is an initiative in the right direction which could result in another successful alliance.
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Apollo Tyres
Tyres
Address Apollo Tyres Ltd Apollo House 7 Institutional Area, Sector-32 Gurgaon- 122 001 Haryana India Tel: + 91 124 2721 000 Fax: + 91 124 2383 021 Internet: http://www.apollotyres.com Senior Officers Onkar S Kanwar, Chairman Neeraj Kanwar, Vice-Chairman & Managing Director Sunam Sarkar, CFO Satish Sharma, Chief, India operations Marc Luyten, Chief Marketing Officer Gaurav Kumar, Group Head, Corporate Strategy & Finance Kaushik Roy, Group Head, Corporate Purchase Satish Agarwal, Chief, Manufacturing Peter Becker, Chief, Research & Development Rob Oudshoorn, CEO, Apollo Vredestein Luis C Ceneviz, CEO, Apollo Tyres South Africa PK Mohamed, Chief Adviser, R&D Products Tyres and alloy wheels Plants India (4): Gujarat, Kerala (2), Tamil Nadu Outside India: Netherland, South Africa (2), Zimbabwe (2) Sales Group: INR88.7bn (USD1.9bn, 31 March 2011) Employees Group: 16,000 ( March 2011)
Apollo Tyres is one of the leading tyre manufacturers in India with 45% market share. The company enjoys market leadership in the commercial vehicle segment and ranks number two in the passenger car segment. In addition to tyres, the company supplies alloy wheels for the automotive industry.
Apollo Tyres operates four manufacturing plants in India and two each in South Africa and Zimbabwe. The company also has one manufacturing facility in the Netherlands through the acquisition of Vredestein Banden BV, which was renamed Apollo Vredestein. As of 31 March 2011, Apollo Tyres had about 16,000 employees worldwide. The company manufactures tyres for passenger cars, utility vehicles, commercial vehicles and off-the road (OTR) sectors such as agriculture and industrial. In addition to tyres, Apollo Tyres makes alloy wheels. The company sells its tyres under Apollo, Vredestein, Dunlop, Kaizen, Maloya, and Regal brands. In the financial year 2011, the company generated 43% of sales from truck-bus segment, 33% from passenger vehicles, 10% each from light trucks and Farm & OTR and 4% from other segment. India is the biggest market for Apollo Tyres which accounts for 62% of its total sales. This is followed by Europe at 25% and South Africa by 13%. The company exports tyres to more than 70 countries worldwide. The company generates the majority of its sales (80% of total) from the replacement market and the remaining 20% from the original equipment (OE) market. Apollo Tyres customers in OE market include Audi, Daimler, Fiat, GM, Hyundai, Mahindra & Mahindra, Maruti Suzuki, Mitsubishi Motors, Tata Motors and Volkswagen. Recent Developments Corporate strategy Apollo Tyres has set a goal to become one of the top ten tyre manufacturers worldwide. In order to achieve its goal, Apollo Tyres is focusing on expanding capacity both in India and the overseas markets. In January 2011, the company announced plans to invest in capacity expansion of its newly-built Chennai plant, in Tamil Nadu (India). Apollo Tyres decided to invest INR2bn (USD42.7m, 31 January 2011) in the plant to raise daily production capacity to 6,000 truck and bus radial tyres and 16,000 passenger car radial tyres. In 2010, the company decided to ramp up capacity at its plants in South Africa by investing ZAR300m (USD40.8m, 15 March 2010) over a period of three years. In the past few years, Apollo Tyres has significantly strengthened its international presence through strategic acquisitions. In 2009, the company acquired Amtel-Vredesteins Dutch business which helped it to significantly increase presence in the European tyre market. The takeover not only resulted in a manufacturing plant in the Netherlands but also provided an access to the companys broad sales and distribution network in the region. Earlier, the acquisition of Dunlop Tyres International in February 2006 gave the company instant access to the African tyre market. The strategic acquisition gave the company manufacturing presence in South Africa and Zimbabwe with four manufacturing plants. The acquired company exports to Europe, Central Asia, Australia and South America and has contract manufacturing tie-ups with major international players. Dunlop is also the sole distributor of Cooper Tyres in South Africa with a network of 230 dealers. Acquisitions In May 2009, Apollo Tyres acquired Vredestein Banden BV, the Dutch division of bankrupt tyre maker Amtel-Vredestein NV (AVNV). The acquired company has a manufacturing plant in Enschede (the Netherlands) with daily production capacity of 150 tonnes of tyres. The company mainly specialises in the high-performance summer and winter
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tyres and has sales and marketing offices in 17 countries across Europe. Post-acquisition, Apollo Tyres has renamed the acquired units name Apollo Vredestein. In February 2006, Apollo Tyres acquired Dunlop Tyres International (South Africa and Zimbabwe) in an all-cash deal worth INR2.9bn (USD65.2m, 28 February 2006) for 100% equity. Dunlop Tyres has four plants in South Africa and Zimbabwe with a product range including bias and radial tyres for trucks and buses, industrial, farm, light truck, off-road, mining and passenger cars.
Divestments In February 2006, Apollo Tyres offloaded a 25% stake in Premier Tyres, from a holding of 71%. Investments
In March 2012, Apollo Tyres announced plans to invest EUR400m (USD532m, 30 March 2012) to set up two manufacturing plants, one in eastern Europe and another in Brazil. In eastern Europe the company is looking for a site for a plant in either Poland, Hungary or Slovakia with an investment between EUR150m (USD199.5m) and EUR200m (USD266m). In August 2011, Apollo Tyres took up 10,000 hectares land on lease for rubber plantation activities in Laos. The company expects to tap yield from the secured land over the next seven years to meet internal requirements. Overall the company aims to secure 20 to 25% of its requirement. In June 2011, Apollo Tyres opened its first office in the JAFZA Free Economic Zone, Dubai (United Arab Emirates). The company has already invested around USD250,000 in creating infrastructure for its business needs in Dubai and plans to invest about USD1.5m annually to boost exports to Europe and the Middle-East In January 2011, Apollo Tyres announced it would expand capacity of the newly-built Chennai plant, Tamil Nadu (India). The company decided to invest INR2bn (USD42.7m, 31 January 2011) in the plant to raise daily production capacity to 6,000 truck and bus radial tyres and 16,000 passenger car radial tyres. At present, daily production capacity at the plant is 1,100 truck radial tyres and 8,000 passenger car tyres. The expansion will also add another 1,100 employees at the facility along with 900 temporary employees. In April 2010, Apollo Tyres announced it would invest ZAR300m (USD40.6m, 31March 2010) at its Ladysmith manufacturing plant in South Africa over a period of three years. The investment will be used to buy new equipment and technology upgrades at the facility. A total of 100 new jobs will be created. The company aims to reduce its production costs with this investment. In February 2010, Apollo Tyres started production at its plant Oragadam, near Chennai, Tamil Nadu (India). The company decided to invest INR2bn (USD43.4m, 28 February 2010) in a greenfield plant in southern India in 2007 to especially cater to automakers operating in the region. The plant is expected to have annual production capacity of 3.5 million tyre units. In February 2008, Apollo Tyres commissioned its INR1bn (USD25.1m, 28 February 2008) expansion at its Limda plant in Gujarat (India) to increase passenger car and light truck radial tyre capacity to 0.3 million units per month and 0.5 million units per month respectively. In December 2007, Apollo Tyres announced its plans to expand the production capacity of its passenger car radial (PCR) tyres. The facility produces around 450,000 units per annum. The company invested INR1.08bn (USD27.4m, 14 December 2007) for the expansion, which primarily took place at the Limda facility near Vadodara, Gujarat (India).
Contract In July 2010, Apollo Tyres started supplying passenger car tyres for Hyundai Motor India Limited. The company dispatched 500 Acelere tyres to the automaker from its Chennai plant in Tamil Nadu (India). In June 2010, Apollo Tyre announced it would supply tyres for Volkswagens vehicles in Europe.
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New Product Developments Apollo Tyres spent INR320.6m (USD7.1m), or 0.6% of its sales on research and development in the financial year 2011. In order to strengthen its R&D capabilities, Apollo Tyres has created a Finite Element Analysis (FEA) cell and is working on various projects that involve development of ultra high performance radial car tyres, durability of tyres and cost optimisation of existing products. In June 2010, Apollo launched its summer and winter tyres in Europe, the first by an Indian tyremaker. In September 2008, Apollo Tyres unveiled the XT-100K cross-ply tyre which delivers better performance. Apollo Tyres has developed the Acelere range which is the first full range of H-rated tubeless passenger radial tyres in India. The company plans to market these tyres in the domestic and the export markets.
Financial Overview In the financial year ended 31 March 2011 Apollo Tyres reported a 9.1% increase in net sales to INR88.7bn (USD1.9bn, 31 March 2011) compared with INR81.2bn (USD1.8bn, 31 March 2010) in the previous fiscal. Although the company witnessed a 7% decline in volume during the financial year compared with a year ago, an improvement in price mix of 16% drove its sales. The company recorded higher growth across its major markets. Apollos sales increased in India by 9%, in Africa by 8% and in Europe by 12%. However, Apollo Tyres earnings during the year remained under pressure primarily due to the continuous rise in raw material prices, mainly natural rubber, which recorded a 70% increase in price compared with a year ago. In addition, the companys earnings were also affected by closure at one of its plants in India and an industry-wide strike in South Africa. Apollo Tyres reported a 39.6% decline in profit before tax to INR5.5bn (USD120.5m) compared with INR9.1bn (USD203m) in the previous fiscal. The company posted a 32.2% fall in net profit to INR4.4bn (USD97.1m) over INR6.5bn (USD145.1m) a year ago. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Sales (INRm) 88,677 81,207 49,841 46,912 42,992 Sales (USDm) 1,953.3 1,803.4 955.3 1,175.7 989.6 Operating Profit (INRm) 7,060 9,207 2,876 4,625 2,769 Operating Profit (USDm) 155.5 204.5 55.1 115.9 63.7 Profit Before Tax (INRm) 5,471 9,140 2,134 4,053 1,964 Pre-tax Profit (USDm) 120.5 203.0 40.9 101.6 45.2 Net Profit (INRm) 4,408 6,533 1,392 2,697 1,171 Net Profit (USDm) 97.1 145.1 26.7 67.6 26.9
Outlook Apollo Tyres expects its outlook to remain challenging amid rising prices of raw materials. The natural rubber which accounts for about 40% of total cost of manufacturing tyre is currently facing acute supply crunches amid rising demand. The situation is not expected to improve in immediate future. In addition, rising crude oil prices, which are hovering over USD100 a barrel, are putting additional pressure on production costs. These two factors are expected to put pressure on margins of all tyremakers including Apollo Tyres. Although global tyremakers are trying to deal with the rising raw material prices through frequently raising prices there is a limit up to which this strategy can be used as it can negatively impact sales. However, Apollo Tyres strong presence in the replacement market, which accounts for around 85% of its sales, helps the company to effectively deal with the rising cost of production. The tyremakers are generally more capable of rising prices of tyres in replacement markets than in the original equipment (OE) market as the latter calls for strong negotiations with the OEM customers. Despite these headwinds Apollo Tyres is well positioned to grow in the medium
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to long term. The company is one of the largest tyre manufactures in India and has developed strong international presence over the last few years through some strategic acquisitions. Overall, the company has grown at compound annual growth rate (CAGR) of 20% in the past five years. Apollo Tyres has almost realised its sales target of USD2bn for fiscal 2011, set five years ago. The company is now targeting to triple its sales in next five years.
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Asahi India Glass

Automotive glass
Address Asahi Inida Glass Ltd Global Business Park Tower-B, 5th Floor MG Road, Gurgaon- 122 002 Haryana Inida
Asahi India glass is the largest manufacturer of automotive safety glass in India. The company produces a complete range of automotive safety glass and enjoys around 77% of share in the Indian automotive market. In addition to automotive, the company supplies glass to building and construction sectors. The automotive segment accounted for 53.8% of the companys sales in 2011.
Asahi India Glass was incorporated as Indian Auto Safety Glass Limited in 1984. The company is a three-party joint-venture (JV) between Labroo family, Asahi Glass Co. and Maruti Suzuki. The promoters jointly hold 55% of the company while the remaining 45% is held by public. The company set up its first plant in Bawal, Haryana (India) which became operational in 1987. The plant commenced supplying to Maruti Udyog, now Maruti Suzuki, as its sole customer. Later in 2003, the companys name was changed to Asahi India Glass. Asahi India supplies a broad range of automotive glass products for threewheelers, passenger cars, multi-utility vehicles (MUVs), light commercial vehicles (LCVs) and heavy commercial vehicles (HCVs). During 2010-11, the company produced 3.5 million units of laminated glass and six million square metres of tempered glass. The company is the market leader, with a 77% market share in the passenger car segment and 64% in the MUV segment. Asahi India supplies its products under umbrella brand AIS-Asahi India Solution. The company operates three Strategic Business Units (SBUs): AIS Auto Glass, AIS Float Glass and AIS Glass Solutions. Currently, the company operates 13 plants across India. The Auto Glass SBU operates four plants one each in Bawal, Haryana; Roorkee, Uttarakhand; Chennai, Tamil Nadu and Taloja, Maharashtra. In addition, the business unit has three sub-assembly/warehouses in Halol, Gujarat, Pune, Maharashtra and Bangalore, Karnataka. Initially, Asahi India was set up to supply Maruti Suzuki. However, over the years, the company has broadened its customer base and now supplies to all leading automakers in India. Asahi Indias major customers include Eicher, Fiat India, Ford India, GM India, Honda Siel, Hyundai India, Hindustan Motors, Mahindra & Mahindra, Maruti Suzuki, Swaraj Mazda, Tata Motors, Toyota Kirloskar, Volkswagen India and Volvo India.
Tel: +91 124 40622 12-19 Fax: +91 124 40622 44/88 Internet: http://www.asahiindia.com
Senior Officers BM Labroo, Chairman Sanjay Labroo, Managing Director and CEO Hideaki Nohara, Deputy-Managing Director, CTO, Automotive Arvind Singh, President, Whole-time Director BS Kanwar, Head, Automotive Unit Products Defogger glass, encapsulated glass, extruded windshield, flush-fitting glass, glass antenna, heated windshield, IR cut glass, laminated windshields, plug-in window, rain sensor windshield, solar control glass, tempered glasses for sidelites and backlites, UV cut glass Plants Automotive and Float Glass India (11): Gujarat, Haryana, Karnataka, Maharashtra (3), Tamil Nadu, Uttarakhand (4) Sales Group: INR15.2bn (USD334.4m, 31 March 2011) (Year to 31.03.11) Automotive: INR8.4bn (USD185.6m, 31 March 2011) (Year to 31.03.11) Employees Group: 1,042 (March 2011)
Recent Developments
Corporate strategy Asahi India is focusing on capacity expansion as well as optimal utilisation of capital expenditure. The company has embarked on capacity expansion plans at its plants at Bawal, Haryana; Chennai, Tamil Nadu; Roorkee, Uttrakhand and Taloja, Maharashtra. The company intends to develop capacity at these plants in order to be in line with customer requirements in the vicinity of the plants. However, the company is enhancing capacity in India in a stage-wise manner to meet surging demand for automotive glass. In the first phase, Asahi Glass carried out capacity expansion for both tempered and laminated glass. The company installed marinated glass capacity at its plants in Roorkee, Uttrakhand and Taloja, Maharashtra. This resulted in increased laminated glass capacity to 4.45 million units and tempered glass capacity to 7.76m2 by the end of financial year 2011. Meanwhile, the company has already started working on the next phase of the capacity expansion involving an investment of INR12.5bn (USD275.3m, 31 March 2011), most of which is expected to become operational in the financial year 2012 and 2013. Meanwhile, Asahi India continues to focus on improving operating efficiencies.
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The company initiated the Look Within programme at the time of global economic slowdown in 2009 to improve efficiency. The programme, which still continues, has resulted in significant reduction in the companys fixed operating costs. Asahi India took various initiatives to improve cost efficiency at its manufacturing plants. For example at its Taloja plant in Maharashtra, the company started using natural gas in place of oil as its primary fuel source. This resulted in significant cost savings for the company at the plant. Meanwhile the company continues to explore areas where costs can be further reduced without impacting operations and quality. Investments In 2011, Asahi Glass announced it would invest INR12.5bn (USD275.3m, 31 March 2011) on ramping up capacities at its plants. Most of these expansions are expected to be completed in financial year 2012 and 2013. In 2010, Asahi India commenced operations at a sub-assembly facility at the Toyota Supplier Park near Bangalore in Karnataka (India). In January 2007, Asahi India commissioned its single largest integrated glass plant in Roorkee, Uttaranchal (India) at a cost of INR6bn (USD135.8m, 31January 2007). The facility has an installed capacity of 700 tons per day for float glass, reflective glass, mirror, automotive safety glass and architectural processed glass. In 2007, Asahi India commenced operations at its second float glass plant in Roorkee Uttaranchal (India). In February 2005, Asahi India commissioned a new automotive glass manufacturing plant in Chennai, Tamil Nadu (India) with an initial capacity of 500,000 laminated windshields. The company invested INR500m (USD11.4m, 28 February 2005) in the plant. The plant caters to Hyundai, Ford, Toyota, GM, HM and Volvo. The plant is also used as an export hub. In 2005, Asahi India made a capacity expansion at its Rewari plant in Haryana (India) to meet growing demand for automotive tempered glass. Contacts OEMs Maruti Suzuki Volkswagen GM Ford Nissan Fiat Tata Motors Honda Toyota Mahindra & Mahindra Certifications In 2010, Asahi Indias plant in Bawal, Haryana, won the Total Production Management (TPM) award 2010 from the Japan Institute of Plant Maintenance (JIPM). Asahi India was the only glass manufacturer in India to win the Deming Application Prize in November 2008. Brand Alto K-10, Ritz Vento Beat Figo Micra Grande Punto Manza, Super Ace, Venture Jazz Etios, Fortuner Gio, Maxximo, Navistar Components Automotive glass Automotive glass Automotive glass Automotive glass Automotive glass Automotive glass Automotive glass Automotive glass Automotive glass Automotive glass
Financial Overview For the financial year ended 31 March 2011 Asahi India
reported a 20.2% increase in net sales to INR15.3bn (USD334.4m, 31 March 2011) compared with INR12.6bn (USD280.4m, 31 March 2010) in the previous year. The company benefitted from strong demand in all three strategic business units (SBUs) Automotive Glass, Float Glass and Glass Solutions. Higher sales led the company to record a strong growth in earnings during the financial year. The company recorded operating profit of INR2.7bn (USD59.5m), up 8.8% compared with INR2.5bn (USD55.5m) in 2010. The company reported an increase in operating profit despite a 37% year-on-year increase in material costs to INR4.7bn (USD104.4m) led by increase in prices of key in raw materials during the year. Asahi India reported profit before tax (PBT) of INR263.1m (USD5.8m) compared to loss before tax of INR17.9m
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(USD0.4m). The company concluded the financial year with a net profit of INR151.5m (USD3.3m) compared with INR12.3m (USD0.3m) in 2010. AIS Auto Glass reported an 18% increase in sales to INR8.4bn (USD185.6m) compared with INR7.2.8m (USD158.9m) in the previous financial year. However, the segment witnessed a decline in profit before interest and unallocatable items from INR1.2bn (USD27.6m) to INR931.5m (USD20.5m). Years 2011 2010 2009 2008 2007 Years 2011 2010 2009 2008 2007 Net Sales (INRm) 15,182.1 12,627.3 12,182.1 9,935.3 7,618.4 Net Sales (USDm) 334.4 280.4 233.5 249.0 175.4 Operating Profit (INRm) 2,724.3 2,513.7 1,427.9 2,046.2 1,648.5 Operating Profit (USDm) 60.0 55.8 27.4 51.3 41.3 Profit Before Tax(INRm) 263.1 (17.9) (9.6) 195.8 632.4 Profit Before Tax(USDm) 5.8 (0.4) (0.2) 4.9 15.8 Net Profit (INRm) 151.5 12.3 (406.0) 133.4 420.8 Net Profit (USDm) 3.3 0.3 7.8 3.3 10.5
Outlook Asahi India continues to dominate the Indian automotive market,

catering to about 75% of total demand. The company which started modestly with supplying exclusively to Maruti Suzuki currently supplies to almost all automakers operating in India.
However, the company, like any other automotive glass manufacturer, is struggling to manage its supply chain to maintain uninterrupted production. Production of raw glass suffered during the global economic slowdown, as many suppliers shut down facilities amid financial stress. However, the supply of raw glass did not recover when demand for automotive glass increased as a result of improvement in vehicle production worldwide. This created supply side shortage for several automotive glass manufacturers including Asahi India. Although the company has its own dedicated raw glass production facilities, it meets some of its requirements through sourcing from outside. The high price of oil is another major concern for all glass manufacturers. The price of energy is directly correlated with price of Poly Vinyl Butyral (PVB) which is another raw material used in the production of glass. This has impacted the operating margin of all glass manufacturers to which Asahi Glass is no exception. Despite these short-term challenges, Asahi India is well positioned to gain from the growth of automotive industry in the medium to long term. The increase in competition among automakers is resulting in sharp increase in frequency of new model launches in India. This trend is expected to intensify in the coming years. Asahi India is strengthening its new model development capability and technologies. The company has partnered with several automakers on the development of new models in the country. As dominant player of the Indian automotive industry Asahi India is expected to gain from this trend.
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Ashok Iron Works

Brake drums, fly wheel housings and wheel hubs
Address Ashok Iron Works Pvt Ltd Mazagaon Road Uyambag Belgaum - 590008 Karnataka India Tel: +91 831 2442 599 Fax: +91 831 2441 899 Internet: http://www.ashokiron.com Senior Officers Ashok Humbarwadi, Chairman Jayant Humbarwadi, Executive Director Products Brake drums, casings, crankcases, crankshafts, cylinder blocks, cylinder heads, flywheel housing, gearbox housings, heavyduty brake drum, wheel hub Plants India (3): Karnataka (3) Sales INR2.8bn (USD62.2, 31 March 2010) (Year to 31.03.11) Employees 3,000 (2011)
Ashok Iron Works manufactures machine castings for the automotive industry. In addition to automotive, the company supplies to the off-the road (OTR) sector.
Ashok Iron Works (AIW) was set up in 1974 in Belgaum, Karnataka (India). The company has three manufacturing plants in Belgaum and employs around 1,100 people. Ashok Iron Works third facility has the highest melting capacity of 200 tonnes per day compared to the previous two. The company supplies to domestic as well as international customers. In the domestic market, the companys main customers include Ashok Leyland, Bharat Earth Movers, Cummins India, Eicher Tractors, Escort, Mahindra & Mahindra, Same Deutz and Tata Motors. In the overseas market, the company supplies to Bitzer, Deutz and Lister Petter. Recent Developments Corporate strategy Ashok Iron Works is expanding its production capacity to meet surging demand for its components. The company has established its third manufacturing plant in Belgaum, Karnataka (India). The companys facilities are located in a strategic area that produces nearly 100,000 tonnes of casting annually worth INR5bn (USD110.2m, 4 July 2011). The area has around 140 foundries and is ranked one of the best casting producing centres in the country. Investments In April 2011, Ashok Iron Works announced plans to expand its cast iron castings production capacity at Belgaum facility in Karnataka (India) with an investment of INR765.2m (USD17.1m). The present capacity of the facility is 72,000 tonnes. Certifications Ashok Iron Works manufacturing plants are certified with QS9000. Financial Overview In the financial year ended 31 March 2010 Ashok Iron Works reported a 9.7% decline in sales to INR2.8bn (USD62.2m, 31 March 2010) compared with INR3.1bn (USD59.8m, 31 March 2009) in the previous year. Despite decline in sales the company recorded a 71.1% increase in net profit to INR166m (USD3.7m) over INR97m (USD2.2m) in the previous fiscal year. Outlook Ashok Iron Works benefits from its strategic location in Belgaum which is the hub for foundries. The Belgaum Foundry Cluster (BFC) has been on constant lookout for future opportunities to increase the output of castings from the city. The cluster was formed in 2004 with the sole objective to support the foundries in and around Belgaum. Further, the companys expansion plans in the area would create an opportunity for the company to further increase its customer base with the additional capacity.
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Ashok Minda Group

Connective systems, security systems plastic interior parts
Address Minda Management Service Limited D-6-11, Sector-59 Noida- 201301 Uttar Pradesh India Tel: +91 120 4787 100 Fax: +91 120 4787 201 Internet: http://www.minda.co.in Senior Officers Ashok Minda, Chairman and Group CEO D.C. Sharma, Group CFO Sanjay Thaper, Group, Chief Strategy Officer N K Taneja, Group Chief Marketing Officer Ashim Vohra, Head, Group Business Excellence Officer Jeevan Mahaldar, CEO, Minda Corporation N. K. Modi, CEO, Minda Stoneridge Instruments Paul Dominik Czarnecki, CEO, Minda KTSN Plastic Solutions, Minda Schenk Plastic Solutions Abhay Joshi, Minda Valeo Security Systems Pramode Parasramka, CEO, Minda Silca Engineering K. D. Singh, Joint President, Minda Furukawa Electric Praveen Gupta, CEO, Minda SAI Anshuman Dev, CEO, Die casting Division, Minda Corporation Amitabh Mathur, CEO, Plastic Division, Minda Corporation Products Minda Corporation: Alarms, door handles, fuel tank locks, glove box locks/ latches, immobiliser systems, lock sets, locking/ latching systems, remote control systems, remote operated immobilisers, steering column lock and modules, trunk locks/ latches Minda SAI: Connectors, couplers, crimps, terminals, wiring harness, wiring sets Minda Stoneridge: Speedometers, odometers, fuel gauge, temperature gauge, sensors, indicators SM Technocast: Zinc die casted components Plants India (16): Haryana, Madhya Pradesh, Maharashtra (6), Tamil Nadu, Uttarakhand, Uttar Pradesh (6)
The Ashok Minda Group is one of the leading manufacturers of connective systems, interiors, security systems and instrument panels for the automotive industry. The company also makes injection-moulded interior parts and die casting components.
The Ashok Minda Group has a diverse product offering which includes electrical and mechanical security systems, wiring harnesses, couplers & terminals, instrument clusters, sensors, windows regulators, and die-casting and interior components. The company caters for two-wheelers, three-wheelers, passenger cars, commercial vehicles and off-the road (OTR) vehicles. In addition to OEMs, the company supplies to aftermarket and exports. The Group operates 13 companies including some as joint-venture with the global suppliers such as Stoneridge and Valeo. In April 2007, the Ashok Minda Group set up a holding company called Minda Management Service Limited which manages of the Groups entire operations. Minda Corporation: formerly a joint-venture (JV) with Huf Hlsbeck & Frst GmbH & Co. KG, the flagship company of the Ashok Minda Group manufactures door systems, security systems and plastic interior parts. The company also manufactures die-casting parts. Minda Corporation operates eight manufacturing plants in India. The company caters to two- and three- wheeler manufacturers along with off-road vehicle makers. Minda Valeo Security Systems: a 50:50 JV with France-based Valeo Security Systems. The JV manufactures security systems for automotive industry. The company has a manufacturing plant in Pune, Maharashtra (India). Minda Silica Engineering: is a collaboration between the Ashok Minda Groups subsidiary, Tuff Engineering Pvt. Ltd., and Italy-based Silica Inc. The company provides solutions to original key makers. The company operates a facility in Noida, Uttar Pradesh (India). Minda Stonridge Instruments Limited: a JV with Stoneridge Inc. that manufactures electronic instruments. Stoneridge holds a 49% stake in the JV. The company operates a plant in Pune, Maharashtra (India). Minda Furukawa Electric: a JV with Japanese company, Furukawa that holds a 51% stake in the JV. The company manufactures wiring harnesses for passenger cars. The JV operates a manufacturing plant in Bawal, Haryana (India). Minda SAI: the company was formed after the acquisition of Sylea Automotive in 2003. The acquisition was made by the Ashok Minda Groups subsidiary called Minda Wirelinks. The company manufactures wiring harnesses, battery cables, wiring sets, connectors and terminals for all the markets of the group company. The subsidiary has manufacturing plants in Noida, Uttar Pradesh, Mumbai, Maharashtra, Chennai, Tamil Nadu and Pithampur, Madhya Pradesh (all in India). Minda Schenk Plastic Solutions: the company became part of the Ashok Minda Group following the acquisition of Schenk Plastic Solutions in 2008. Later, the acquired companys name was changed to Minda Schenk Plastic Solutions. The company manufactures interior products which include functional, decorative, trim and seat products. The subsidiary operates three facilities in Germany and one each in Czech Republic and Poland. Minda KTSN Plastic Solutions: the company is a subsidiary of Minda Group and manufactures interior products, engine components and air pipes. The company operates a manufacturing facility in Pirna (Germany) PT Minda ASEAN Automotive: the company is a subsidiary of Minda Group in Indonesia that manufactures switches and locks for two-wheelers. The company has one manufacturing facility in Jakarta (Indonesia). Minda Vietnam Co. Ltd.: manufactures automotive components in VinPhuc (Vietnam) and exports to other ASEAN countries. Minda International: formed in 2007, the company helps in communication, coordination and collaboration with Japanese OEMs in relation to design and development of auto components globally.
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Outside India: Czech Republic, Germany (4), Indonesia, Poland, Uzbekistan, Vietnam Sales Group: INR25bn (USD550.1m, 31 March 2011) (Year to 31.03.11) Employees Group: 9,500 (March 2011)
Uz Minda: with Uzbekistan's Uzavtoprom manufactures auto components from its newly established plant in the Navoiy industrial area of Uzbekistan. The JV caters to the Country of Independent States (CIS) region and Russia.
The Ashok Minda Group operates a total of 25 facilities, of which 16 are located in India and nine plants in Czech Republic, Germany, Indonesia, Poland, Uzbekistan and Vietnam. The Group also has a logistics centre in Netherlands. As of 31 March, the Group has employed 8,000 people. The Group has a very diverse customer base. The Ashok Minda Group mainly supplies to Audi, Aprilia, BMW, Bajaj Auto, Daimler, Escorts, Fiat, Force Motors, Ford, GM, Hero, Honda, Hyundai, JCB, Kawasaki, Maruti Suzuki, Mahindra & Mahindra, PSA Peugeot Citron, Piaggio, Renault-Nissan, Sonalika International, Tata Motors, TAFE, Triumph, Toyota, Volkswagen, TVS Motor and Yamaha. In addition, the Group supplies to tier 1 suppliers which include Bosch, Chery, Danaher, Faurecia, Fehrer, Grote, IKEA, Johnson Controls, Lear, Magna, Mosdorfer, Pollak and Valeo. Recent Developments Corporate strategy The Ashok Minda Group is investing in ramping up capacities to meet increased demand for its components. In January 2012, Minda Corporation, the flagship company of the Group announced plans to invest USD50m in capacity expansion over the next five years. The company will make this investment for adding capacity at its existing plant in Pune, Maharahtra and set up two greenfield plants, one in Chennai, Tamil Nadu and another in Sanand, Gujarat (all in India). Earlier in October 2010, the Ashok Minda Group invested INR10bn (USD22.1m) in capacity expansion to meet increased demand from its customers. The Group which reported INR25bn (USD550.1m) in sales in financial year 2011, has set a goal to generate turnover of INR110bn (USD2.4bn) by financial year 2015. In order to achieve this, the Ashok Minda Group intends to focus on both organic and inorganic growth. The Group is looking for selective acquisitions as well as jointventures to expand its business. In October 2010, the Ashok Minda Group acquired Akyses, a composite moulds supplier with a manufacturing plant in Koengen (Germany) and customers including Daimler, GM, PSA Peugeot Citron, Renault and Volkswagen. Ashok Minda Group recently expanded its presence in eastern Europe, keeping in mind the high growth potential of the Russian automotive market. The company has set up a 50:50 joint-venture with Uzavtoprom to produce auto components in the Navoiy industrial area of Uzbekistan. The new plant, being cloe to the customers market in Europe, provides a significant cost advantage to the Ashok Minda Group. Earlier the Group catered to this market through direct exports from India which used to be uncompetitive due to high logistics costs. Acquisitions In October 2010, the Ashok Minda Group acquired a 100% stake in Germanybased Aksys. The acquired company manufactures composite moulds and supplies to Daimler, Volkswagen, Renault, PSA and GM. The transaction included Aksys' facility situated in Koengen (Germany). The company has renamed the acquired business Minda Schenk Plastic Solutions GmbH. The acquired company brings technologies such as sheet mould compounding, glass long fibre, glass mat thermoplastics and injected mould compounding. In June 2008, the Ashok Minda Group acquired interior component supplier Schenk Plastic Solutions in Germany. Schenk is a leading supplier of plastic parts and components for the automotive and technical parts industries with plants in Esslingen and Bretten in Germany and Liberec in the Czech Republic. The company has a patented skinform technology which produces high-value interior surfaces at a lower cost than previously possible. Schenk is a major supplier to Daimler with the carmaker accounting for 60% of the suppliers sales. In February 2007, the Ashok Minda Group acquired Kunststofftechnik Sachsen GmbH & Co KG (KTSN), for EUR42.6m (USD96.4m). KTSN manufactures technology plastic injection-moulded interior parts and specialty products such as glove boxes, cup-holders and ashtrays and catered to major OEMs such as Audi, Daimler and Volkswagen. The acquisition helped the Ashok Minda Group to further expand its presence in Europe which also contributed significantly to the companys exports.
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Joint-ventures In April 2011, the Ashok Minda Group expanded its joint-venture (JV) with Stoneridge to add production of sensor technology in India. In the initial stages, the alliance is expected to expand its product offering by manufacturing various high-temperature and other sensor products. Simultaneously, the JV will utilise technical information licensed by Stoneridge. In turn, Stoneridge will receive royalties from the JV for technologically advanced products. The sensor products will serve the passenger cars and commercial vehicles markets. In August 2010, the Ashok Minda Group signed a joint-venture (JV) agreement with Uzbekistan-based Uzavtoprom. The JV, named UzMinda, commissioned a new manufacturing plant in the Navoiy industrial area of Uzbekistan. Uz Minda manufactures speedometers and switches at the facility with an output of 200,000 sets annually. In August 2007, the Ashok Minda Group announced a joint-venture (JV) with Japan-based Furukawa Electric Co Ltd., and Furukawa Automotive Parts Inc., (Furukawa Group). The JV is 51: 49 partnership and the new company was named Minda Furukawa Electric Pvt. Ltd. (MFEP). The JV operates a manufacturing plant in Bawal, Haryana (India) and manufactures the entire range of wiring harness for passenger car market such as couplers, terminals, relay box, junction box and steering roll connectors used for the airbag systems. In May 2007, the Ashok Minda Group entered into a 50:50 joint venture (JV) with the security systems branch of Valeo. The JV operates a manufacturing plant near Pune in Maharashtra (India) and produces the entire range of Valeo Security Systems products including locksets, steering column locks, latches, strikers, handles, engine immobilisers, remote keyless entry systems, passive entry, start systems and power closure systems. In December 2006, the Ashok Minda Group entered into a JV with Silca, the worlds largest manufacturer of keys, to supply keys and key duplicating machines for the Indian and international markets. The new company was named Minda Silca Engineering Ltd. Both partners hold 50% share each in the new company. Investments In January 2012, the Ashok Minda Groups flagship company Minda Corporation announced plans to invest USD50m in capacity expansion in India over the next five years. The company will make this investment to add capacity at its existing plant in Pune, Maharashtra and set up two greenfield plants, one in Chennai, Tamil Nadu by end 2012 and another in Sanand, Gujarat by end 2013. In October 2010, Ashok Minda announced plans to invest INR10bn (USD22.1m) to ramp up capacity during the financial year ended March 2011. Contracts Minda supplies air directional control, battery, interior lightings, hazard switches, signal switch, dimmer and passing switch, light switch, air conditioner switch and blower switch to Tata Nano. Minda Valeo Security Systems supplies door handles, instrument clusters and remote keyless entry to Tata Sumo Grande. Minda Valeo Security Systems supplies ignition switch cum steering lock to Chevrolet Spark. Minda Corporation is the single source supplier for the Tata Indica and Safari. Minda Corporation is the single source supplier for the Mahindra & Mahindra Scorpio. The company also supplies to Bolero model. Minda Corporation is the single source supplier to Force Motors for the Trax and the Traveller. The company supplies transponder immobiliser locksets to Ford in Mexico and South Africa. Minda Stoneridge is the single source supplier to Tata Motors for the Sumo and the LCV- 407/709. Minda Stoneridge has been chosen as the single global source supplier for the Piaggio NQP World Van. Minda Stoneridge is the single source supplier to Mahindra & Mahindra for the regular tractor. Minda Stoneridge is the single source supplier to Escorts for Farm Trac and Power Trac. New Product Developments The Ashok Minda Group has dedicated research and development (R&D) departments in each of its group companies. The R&D department in Minda Corporation undertakes development of automotive components such as mechanical and electronic security systems, window regulators, electronic
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controllers and plastic interiors. The division also develops these products for the Indonesia and Vietnam companies. Financial Overview Most of the units of the Ashok Minda group are privately-held and financials are not disclosed. However, the group reported sales of INR25bn (USD550.1m, 31 March 2011) for the fiscal year 2010-11. In October 2010, the Ashok Minda Group announced plans to go public over the following 18 months. However, no further details have as yet been provided by the company. Outlook The Ashok Minda Group has set an ambitious goal of quadrupling its sales in four years. The Group expects the strong growth of the domestic industry, with significant support from its overseas business, to help it meet the targets. However, the organic growth may not be sufficient for the Ashok Minda Group to achieve financial year 2015 goal. Therefore the company expects to aggressively pursue acquisitions in the coming years. Over the past 10 years, the Ashok Minda Group has focused on international expansion. The Group has acquired six companies in Europe and entered into a jointventure in CIS region. In addition, the Group has established manufacturing presence in Association of South East Asian Nations (ASEAN). This makes the Ashok Minda Group one of the few Indian suppliers with growing international presence. Such diverse geographic presence is expected to help the Ashok Minda Group reduce its overall dependence on the Indian market for growth. Besides, the strong overseas presence is expected to enable the Ashok Minda Group to secure new business and cater to overseas demand more effectively than exporting from India.
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Auto Ignition
Alternators, ignition coils, starter motors
Address Auto Ignition Ltd. 49 KM Milestone Mathura Road Prithla Palwal-121102 Haryana India Tel: +91 1275 249 200 Fax: +91 1275 262 044 Internet: http://www.autolek.com Senior Officers R K Sarine, Chairman Ishaan Sarine, Director A K Goyal, Executive Director T C Bansal, Vice-President, Finance D Dey, Vice-President, R&D Joshender Virk, Vice-President, Marketing C R Kataria, General Manager, Plant and Production Engineering Satish Kapoor, Associate Vice-President, Export Marketing Products Alternators, armatures, drives, dynamos, generators, ignition coils, solenoid, starter motors, voltage regulators Plants India (2): Haryana, Uttrakhand Sales USD40m (Year to 31.03.11) Employees c. 650 (31 March 2011)
Auto Ignition is a major supplier of alternators, ignition coils, starter motors and voltage regulators to the automotive industry. In addition to automotive, the company supplies to off-road vehicles and stationary engines. The company is the largest exporter of auto electric components from India.
Auto Ignition started its operations in 1972. The company supplies mostly to tractor and commercial engine manufacturers in India. The company sells its products under Auto-Lek brand. The company manufactures more than 600,000 starter motors and 500,000 alternators annually for the domestic OEMs, aftermarkets and exports markets. Auto Ignition has a diverse customer base. The companys major customers include Ashok Leyland, Bajaj, Cummins, Eicher, Escorts, Force Motors, International Tractors, John Deere, Mahindra & Mahindra, Simpson, TAFE and Tata Motors. The company also supplies to Prestolite of the UK. In addition, the company manufactures aftermarket replacement components catering for parts manufactured by leading suppliers such as Bosch, Delco Remy, Lucas, Magneti Marelli and Nippon Denso. Auto Ignition is also one of the leading exporters of auto electrical parts from India. The company exports its products to more than 25 countries in Australia, Europe, Middle East, North and South America and South Africa. Exports account for nearly four-fifths of the companys sales. Recent Developments Corporate strategy Auto Ignition is focusing on strengthening its presence in the original equipment (OE) market in tractor and stationary engines. The company has set a goal to gain 80% market share in these two segments in the near future. In addition, the company is expanding its base sport-utility vehicle (SUV), light commercial vehicle (LCV), heavy commercial vehicle (HCV) and intra-city 0.4 to 0.6 litre diesel vehicles. The company is also working to establish contact with OE customers in the US and Europe to win additional supply contracts. The company is investing in ramping up capacity to meet surging demand from its target segments of the automotive industry. In order to accommodate increased production, the company decided to relocate its plant in Faridabad to Prithala, both in Haryana (India) during financial year 2010. Auto Ignition has been focusing on increasing exports with about 40% of the companys sales derived from overseas. The company has a diverse product range in the electrical area. The company plans to continue its focus on exports to the aftermarket where profit margins are better. Investments In 2010, Auto Ignition decided relocated production from Faridabad to Prithla, both in Haryana (India). The company established a new manufacturing plant at the new location which produced electrical components for automotive industry. Certifications Auto Ignition's plant has been certified with QS 9000 from BSI (UK) Auto Ignition plants is also certified with ISO 9002 and TS16949:2002 through TUV GmbH Germany. New Product Developments Auto Ignition operates a research and development (R&D) centre. The company designs and develops a large range of gear reduction
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starter motors. These motors have improved power and torque to weight ratio resulting in reduced size and decline material cost. Financial Overview In the financial year ended 31 March 2011, Auto Ignition's estimated sales were USD40m. The company is privately-held, and therefore does not publish details of financial results. Outlook Auto Ignition has identified its niche in the automotive industry and intends to focus mainly on that segment for its growth. However this does not mean that the company will not look beyond this niche segment. In fact, the company has focused on sport-utility vehicles (SUV), light commercial vehicles (LCV) and heavy commercial vehicles (HCV) as its target segments. Bearing in mind the volatile nature of demand in the OEM market, Auto Ignition is strengthening its presence in the aftermarket. This is expected to create a buffer zone for the company during adverse business conditions in the OEM market, like during the recent global economic slowdown. In addition to India, the company is concentrating on increasing presence in the global aftermarket through exports.
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Automotive Stampings
Sheet metal components
Address Automotive Stampings & Assemblies Limited Gate No 427, Juna Chakan Medankarwadi Pune- 410 501 Maharashtra India Tel: + 91 2135 679801-05 Internet: http://www.autostampings.com Senior Officers Pradeep Mallick, Chairman Vijay Bijlani, CEO Rajendra Singhvi, CFO Amitabh Mukhopadhyay, Director Products Outer door skin panels, inner door frames, outer bonnet skin, inner bonnet frame, outer side door frame, tractor fender assembly, CV sector skin panels, three wheeler skin panels and wheel housings. Plants India (4): Gujarat, Maharashtra (2), Uttarakhand Sales INR5.3bn (USD116.6m, 31 March 2011) (Year to 31.03.11) Employees Group: 2,525 (March 2011) Investments In December 2010, ASAL expanded capacity at its Pantnagar facility in Uttarakhand (India). The expansion will enable the company to cater to the new vehicles based on the 1-tonne Ace platform of Tata Motors. The company invested INR192.9m (USD4.2m) on the expansion of the plant. Meanwhile, ASAL starting expanding the 0.5 tonne commercial goods and passenger carrier programme at the plant which is expected to be completed in financial year 2012. The company's total investment amounts to around INR300m (USD6.6m, 31 December 2010). In December 2010, ASAL expanded capacity at its Pantnagar facility in Uttarakhand (India). The expansion will enable the company to cater to the new vehicles based on the 1-tonne Ace platform of Tata Motors. The company invested INR192.9m (USD4.2m) on the expansion of the plant. Meanwhile, ASAL starting expanding the 0.5 tonne commercial goods and passenger carrier programme at the plant which is expected to be completed in financial year 2012. The company's total investment amounts to around INR300m (USD6.6m, 31 December 2010). In 2009, ASAL undertook a capacity expansion programme at its Chakan facility, in Pune Maharashtra (India). In May 2008, ASAL commenced production at its new plant in Pant Nagar, Uttarakhand (India). The plant mainly caters to Tata Motors.
Automotive Stampings & Assemblies Limited (ASAL) is a subsidiary of the Tata AutoComp Systems (TACO). The company manufactures sheet metal components, welded assemblies and modules for the automotive industry.
ASAL was incorporated as JBM Tools in 1990, to develop tools, dies and moulds for OEMs and others. The company entered into a joint-venture (JV) with Tata Motors in 1995. Five years later, TACO bought 48.8% of the share capital of ASAL, raising its stake to 81%. Meanwhile, the company diversified its product line through adding paint and weld shops and a fresh set of presses, purchased from GM. In 2003, the company changed its name to Automotive Stampings & Assemblies Limited. In August 2008, Spain-based Gestamp Servicios acquired a 37.5% stake in ASAL. The Indian supplier expected to gain from the expertise of the Spanish supplier in operations and new projects. However, in December 2010 Gestamp sold its stake in the company. As of 31 December 2011, the TACO owned 75% stake in ASSL. The company operates four manufacturing plants in India, two of which are located in Pune, Maharashtra and one each in Halol, Gujarat and Pantnagar, Uttarakhand. ASALs main product range includes body-in-wWhite (BIW) structural panels, fuel tanks, oil sumps, skin panels and suspension parts, mainly for passenger and commercial vehicles. The company has a combined production capacity of 30,000 tonnes of components and assemblies a year. ASAL supplies to Fiat, GM, John Deere, Mahindra & Mahindra, Piaggio and Tata Motors. Recent Developments Corporate strategy TACO, the parent group of ASAL, is streamlining its business in order to focus on high-margin selected product lines. The group has identified automotive stamping as its core business. In 2010, the auto component major decided to consolidate its presence in ASAL through acquiring a 37.5% stake held by Spanish supplier Gestamp Automocion. Also, in 2010, ASAL completed capacity expansion at its Pantnagar facility in Uttrakhand (India). The company invested around INR300m (USD6.6m) and has further undertaken expansion of 0.5 ton commercial goods and a passenger carrier programme that is expected to be completed by 2012. ASAL is also planning to expand its Halol facility in Gujarat with an investment of INR740m (USD16.2m) by March 2012.
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In February 2008, ASAL completed some capacity expansion at its Chakan plant in Maharashtra (India) to support Tata Indica programme. The company shifted some of its expansion plans to its Bhosari plant, also in Maharashtra. ASAL completed the remaining expansion in financial year 2008-09.
Contracts ASAL supplies skin components and body-in-white (BIW) components to Fiat India. ASAL supplies underbody components such as assembly front floor, cross member, longitudinal rear, top shell for fuel tank, radiator support top and suspension tower rear for Tata Indigo. ASAL supplies panel wheel housing for Tata Safari and wheel arch for Sumo. ASAL supplies assembly fenders for Mahindra & Mahindra tractors ASAL supplies assembly front floor, longitudinal rear, panel B pillar and top shell for fuel tank for Tata Indica. ASAL supplies assembly fenders and consoles for John Deere tractors. ASAL supplies body-in-white (BIW) components and assemblies to GM India. ASAL supplies clutch covers for Gujarat Setco commercial vehicle. ASAL supplies engine mounting brackets for Transit, Ford. Certifications ASALs all four manufacturing plants are TS-16949 certified. In addition, the companys two manufacturing plants in Pune, Maharashtra have ISO14001quality accreditations. Financial Overview In the financial year ended 31 March 2011 ASAL reported a 27.9% increase in net sales to INR5.3bn (USD116.6m, 31 March 2011) compared with INR4.2bn (USD91.9m, 31 March 2010) in 2010. The company gained from increased order from its customers during the financial year. ASSL also secured new contracts from OEMs during the period, however the company did not disclose identity of new customers. During the year, the company reported a 28.3% increase in sales in the domestic market to INR5.3bn (USD116.3m) compared with INR4.1bn (USD91.4m) in the preceding year. The domestic sales accounted for 99.7% of its total sales. However, the company witnessed a sharp decline in exports from INR25.9m (USD575171) in 2010 to INR16.1m (USD354,643) in 2011. Higher sales led the company to almost double its profit before tax (PBT) to INR150.5m (USD3.3m) compared with INR77.7m (USD1.7m) in the previous financial year. ASAL also doubled its net profit during the financial to INR101.7m (USD2.2m) compared with INR51m (USD1.1m) in 2010. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 5,295.1 4,139.9 3,456.2 3,009.9 3,131.8 Net Sales (USDm) 116.6 91.9 66.2 75.4 78.5 Profit Before Tax (INRm) 150.5 77.7 (33.3) 65.8 168.9 Profit Before Tax (USDm) 3.3 1.7 (0.6) 1.6 4.2 Net Profit (INRm) 101.7 51 (24.2) 43.0 142.7 Net Profit (USDm) 2.2 1.1 (0.5) 1.1 3.6
Outlook ASAL has been investing in ramping up capacities at its facilities. This will help the company to meet expected surge in demand for sheet metal components in India. ASAL expects both passenger and commercial vehicles markets in India to grow by 16-18% over next five years. As a leading supplier of sheet moulding components the company is well positioned to grow in coming years. ASAL expects the sheet metal component sector to record higher growth than the automotive industry. The company believes that sheet moulding components could play a vital role in helping automakers to reduce overall vehicle weight, which in turn will help cut fuel consumption and emissions.
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Fluctuating raw material prices are a major concern for sheet moulding component manufacturers like ASAL. Steel is a major raw material used in the production of sheet moulding components and therefore steel prices have a direct bearing on the selling price as it constitutes around 76-78% of the sales. However, sheet moulding component suppliers have an agreement with their customers to compensate for increased steel prices. ASAL is a company of TACO, a Tata Groups subsidiary, which also has Tata Steel, the biggest automotive steel supplier in India. This helps the sheet moulding supplier to get steel at competitive price.
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Axles India
Axles
Address Axles India Limited 21 Patullos Road Chennai- 600002 Tamil Nadu India Tel: + 91 44 2852 2745 Internet: http://www.axlesindia.com Senior Officers S Ram, Chairman and Managing Director MK Surendran, President, Operations Y. Krishnamoorthy, General Manager, Finance Products Axle housings, axle beams, hub reduction axle housings Plants India: Tamil Nadu (2) Sales INR4.8bn (USD106.6m, 31 March 2011) (Year to 31.03.11) Employees c. 1,000 (31 March 2010)
Axles India is a leading supplier of axles to the commercial vehicle segment in India. With Dana as its joint-venture partner, Axles India is broadening its product range and growing its exports.
Axles India Limited was incorporated in 1983, as a tri-party joint-venture between Sundaram Finance, Wheels India and Eaton Corporation for the production of axles for medium and heavy duty commercial vehicles in India. Subsequent to Danas takeover of Eatons axle business, Dana became the promoter. Production of pressed axle housings commenced in 1983. Recently in April 2011 Axles India sold its drive head business unit to its jointventure partner Dana Corporation for INR57.7m (USD12.9m, 30 April 2011). Under the transaction, the company transferred production of commercial vehicle components portfolio to the US partner as well as its manufacturing plant in Sriperambadur in Tamil Nadu and Pant Nagar, Uttarakhand. Prior to this transaction, Axels India had capacity to produce 180,000 pressed axle housings for the domestic market and 100,000 pressed axle housings for the North American market. The company supplies its axles to medium and heavy duty commercial vehicles from its two plants in Tamil Nadu (India). Axles Indias major customers include Ashok Leyland, Mahindra & Mahindra, Swaraj Mazda, Tata Motors and Volvo Eicher. Before transferring assets to Dana, the company exported axles to the company for the North American Market. Recent Developments Corporate strategy In April 2011, Axel India decided to divest its drive head business unit to its joint-venture partner Dana Corporation for a consideration of INR57.7m (USD12.9m, 30 April 2011). Dana took over the axle drive head and final axle-assembly operations of Axles India. Through this deal, Dana also acquired Axle Indias plants at Sriperambadur near Chennai, Tamil Nadu and Pant Nagar in Uttarakhand (both in India). The transaction completed in July 2011. Axle India will use the proceeds from the transaction to reduce its debt. The company will continue to manufacture axle housing for commercial vehicles. Axle India has entered into an agreement to continue supplying axle housings to the Dana. In addition Axles India has secured a contract from Bharat Benz, the Indian commercial vehicle unit of Daimler Trucks to supply axles housing. The supply will commence in August 2012. Divestment In April 2011, Axles India signed an agreement with Dana to divest its drive head division of commercial truck axle business for INR57.7m (USD12.9m, 30 April 2011). The transaction was completed in July 2011 after the approvals from government regulatory bodies. According to the agreement, Dana took full ownership of Axles India's axle drive and final axle-assembly facility. Axle drive production includes the pinion, ring gear, differential lock, bearings, lube pump and yoke products which are part of axle housing. Dana will also look after the marketing, sales and development of these operations. Contracts Axles India has secured a contract from Bharat Benz, the Indian commercial vehicle unit of Daimler Trucks to supply axles housing. The supply will commence in August 2012. Financial Overview In the financial year ended 31 March 2011 Axles India reported a 23.2% increase in sales to INR4.8bn (USD106.6m, 31 March 2011) compared with INR3.9bn (USD87.3m, 31 March 2010) in the previous year. The strong growth in sales led the company to record a fourfold increase in profit before tax (PBT) to INR62.9m (USD1.4m) over INR14.9m (USD33,557) in 2010.
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The company concluded the financial year with net profit of INR42m (USD92,516), recording a five-fold increase over INR8.5m (USD19,076) in the previous year. Axles India is not a public company and therefore does not publish details of its financial results. Outlook Even though Axle India and Dana had collaboratively introduced drive heads in the Indian market and further strengthened their collaboration with the product development efforts and the export unit, the US company acquired the drive axle and final axle-assembly facility of the Indian company. Meanwhile the Indian partner continues to supply axle housings for commercial vehicles. In order to secure its business, Axles India has entered into a supply agreement with Dana to continue supplying axles housing to the US partner. In addition, the company secured a contract from Bharat Benz who had recently entered the Indian commercial vehicle segment. Recently, the group has been consolidating its presence in the auto-component business. Two years ago, the local component major divested its stake in another joint-venture, TVS-WABCO, selling its stake to the US-based JV partner, WABCO Holdings. In turn, WABCO exited its holding in Sundaram Clayton.
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Bagla Group
Automotive electrical, die-castings, fasteners and wheel assemblies
Address Bagla Group Gate No. 65, Village Chitegaon Taluqa- Paithan Aurangabad- 431 005 Maharashtra Tel: +91 2431 251 482-86 Fax: +91 2431 251 488-9 Internet: http://www.baglagroup.com Senior Officers Rishi Bagla, Chairman & Managing Director Ajay Kumar Tannu, President V G Jalnapurkar, Vice-President, Operations Products Aluminium die casting, brake pedal assembly for two wheelers, fasteners, relays & flashes, wheel rims Plants India (10) Sales e. INR5bn (USD110.1m, 31 March 2011) (Year to 31.03.11) Employees c. 1,500 (2007)
Bagla Group is one of the leading suppliers of electrical, fasteners, wheels and brakes pedal assembly and die-casting products in India. The company supplies its products to OEMs and tier one suppliers. In addition to automotive, the company caters to the non-automotive industry.
Bagla Group commenced operations in 1986 through setting up a manufacturing plant for Bajaj Auto. Later the company diversified into aluminium die casting & machining components and wheel & rims assembly business. The company currently operates 10 manufacturing facilities across India. Bagla Group operates its business through four companies: Aurangabad Electricals: is the flagship company of the Bagla Group and has four operating segments Auto Electrical, High Pressure Die-Castings (HPDC), Fasteners and Wheels and Brakes. Aurangabad Motors: has an operation in automotive, Gravity Die-Castings (GDC). The company also supplies condensers for refrigerators. BG-LI-IN Electricals: is the smallest of the group companies operating solely in the electrical area with relays and wound components like magnetos and HT coils. BG Appliances: is a leading electronics manufacturing services (EMS) company that caters to appliances, lighting, automotive and telecommunication industries.
Bagla Group supplies to two-wheelers, passenger vehicles and commercial vehicles. Bajaj Auto is the largest customer of the Bagla Group accounting for 80% of its sales. In addition, the company supplies to Behr, Bosch, Delphi, Knorr-Bremse, Lombardini, Magna, Piaggio and Tata Motors. Recent Developments Corporate strategy Aurangabad Electricals, the flagship company of the Bagla Group has shifted its focus to die cast components. The company is seeking acquisition opportunities in Europe and USA which could help it expand its international market presence and provide an access to technology. Aurangabad Electricals has also vertically integrated its die-casting business by adding a full fledged tool room and machining centre. The company is promoting fully machined castings to strengthen its relationship with customers by partnering them as a full service supplier. Further the company is making technological advancements in its die-castings to meet the customer requirements based on tougher emission norms. The focus is on developing a deep engineering competence. Aurangabad Electricals has developed strong relationships with its customers and is keen to concentrate on them for future growth in the die-casting segment. The group has entered new segments, such as fasteners and wheels, both of which have shown good demand. Bagla Group is building its second line of offerings to widen its reach in the market. Joint-ventures Bagla Group has a joint-venture with LI-IN Electricals, Taiwan for the production of relays. LI-IN holds a 25% equity in the joint-venture. Bagla Group shares a technical collaboration with Shihlin Electric for HT Coil production. Bagla Group also shares a technical collaboration with Taigene Electric, Taiwan for magneto production. Investments In September 2006, Bagla Group invested an undisclosed amount to set up a gravity die-casting facility in Pantnagar, Uttarakhand (India). The new plant supplies die cast components to Bajaj Auto which operates an assembly plant in Pantnagar. In April 2006, Bagla Group announced plans to invest INR1.5bn (USD33.3m, 30 April 2010) on capacity expansion over the following two years.
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In March 2006, Bagla Group set up a fastener manufacturing facility at Aurangabad, Maharashtra (India) with an installed capacity of 6,000 metric tonnes per annum (MTPA). The plant can be further upgraded to handle production volumes of up to 8,400MTPA. The plant supplies to Bajaj Auto, Knor-Bremse, Piaggio and Lambordini. In February 2006, Bagla Group established a third die-casting plant in Aurangabad, Maharashtra (India) to meet growing demand of aluminium die cast components. The die casting division has 42 fully automatic die casting machines with locking force up to1600 tonnes.
Contracts Bagla Group supplies bearing frames and air-intake pipes to Tata Motors. Bagla Group also supplies safety brake system components such as SBA sets and valves to Knorr-Bremse. Bagla Group supplies die cast components for Behrs viscous clutches. The company won orders from Piaggio (Italy) for various die-casting components of the bi-cylinder and Derby engine sets along with suspension parts and aesthetic parts. Certifications All manufacturing facilities of the Bagla Group are ISO/TS16949 accredited. Financial Overview In the financial year 20011, Bagla Group is estimated to have generated sales of INR5bn (USD1.1bn, 31 March 2011) The company is privately held and does not publish financial statements. Outlook Bagla Group has witnessed substantial growth backed by its entry into the die-casting space. The group is poised to make steady growth by scaling up its capacity. As demand for low cost sourcing for castings increases on account of closures of foundries in Europe and increasing amount of high end products being sourced from India, the technical competence gap is expected to be bridged in the medium term. The groups strategy to follow multi product, multi customer and multi locations, with the centralised core competency of engineering, will help to achieve its growth target.
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Bajaj Motors
Forgings and machined parts
Address Bajaj Motors Ltd 39-40 KM Stone Delhi-Jaipur Highway Narsingpur, Gurgaon 122001 Haryana India Tel: +91 124 2371 453 Fax: +91 124 2372 553 Internet: http://www.bajajmotors.com Senior Officers V P Bajaj, Chairman & MD S P Bajaj, Director Vikas Bajaj, Joint MD Products Arm valve rockers, bushes, bushing (ferrous & nonferrous), cold forged and cold extruded parts, CNC machining and turned components, collar, cam shaft connecting rods, crank pin, crank shafts, crank shaft assemblies, fork gear shift, fork shifter, piston pin, gear shift drum, hot forgings, king pin, piston rod, powertrain assemblies, precision, shaft, SG iron castings, sheet metal components, spindle axle, stay rod, stem complete steering, tubular components for suspension assemblies, upper bracket Plants India (4): Haryana (3), Uttarakhand Sales c. INR 2bn (USD50.1m, 31 March 2008) (Year to 31.03.08) Employees c. 1,900 (31 March 2008)
Bajaj Motors is a major supplier of precision engine components. The company supplies its products to two-wheelers, fourwheelers, tractors and other heavy machine equipment.
Bajaj Motors started operations in 1986. The company operates four manufacturing plants of which three are located in Gurgaon, Haryana and one in Pant Nagar, Uttarakhand. Bajaj Motors commenced export in 2003. The company exports products such as bar pins, loops, crank shafts, rockers and stub axles to Italy, Russia, Sweden, US, and other parts of Europe and Asia. The companys major domestic customers include Hero MotoCorp, New Holland Tractors India and Tata Motors. The company also supplies to automotive suppliers such as Endurance Group, Gabriel India, Hema Engineering, Munjal Showa, and Sandhar Technologies. Bajaj Motors exports components to CNH Italy, Husqvarna, V M Motori and Tenneco Automotive. Recent Developments Corporate strategy With the start of the casting unit in Gurgaon, Haryana (India) in 2006, Bajaj Motors began backward integration process for the forging and machining operations. The casting facility specialises in shell moulding casting. Also, the plant contributes substantially to the companys exports. Meanwhile, Bajaj Motors has expanded its operations outside Haryana. In 2009, the company invested INR350m (USD7.2m) in an integrated casting, forging and machining facility in Pant Nagar, Uttarakhand (India) which supplies to the Tata Motors. Investments In 2009, Baja Motors announced plans to set up a casting, forging, machining components facility in Pant Nagar in Uttarakhand (India). The company invested INR350m (USD7.2m) in the new manufacturing plant which supplies Tata Motors Certifications Bajaj Motorss all manufacturing plants are accredited with ISO 9001:2000 and TS 16949, ISO 14001 certifications from TUV GmbH, Germany. Financial Overview In 2008, Bajaj Motors sales were estimated at INR2bn (USD50.1m, 31 March 2008). The company is privately held and therefore does not publish details of financial results. Outlook With an integrated forging and machining facility, Bajaj Motors is streamlining its supply capability with an aim to become a niche supplier of precision engine components. Bajaj Motors new plant in Pant Nagar is expected to help the company effectively supply some of its existing customers as well as win some new contracts from new OEMs who have set up their assembly plants in the state. Several two-wheeler and commercial vehicle manufacturers such as Bajaj Auto, Hero Honda, Ashok Leyland and Tata Motors have set up their assembly plants in the state.
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Banco Products
Gaskets & Radiators
Address Banco Products (India) Limited Bil, Near Bhaili Railway Station Padra Road District Baroda - 391 410 Gujarat India Tel: +91 265 2680 220/221/222/223 Fax: +91 265 2680 430/433 Internet: http://www.bancoindia.com Senior Officers Vimal K Patel, Chairman S K Thakker, Executive Director & CFO R R Kedia, Executive Director Kiran Shetty, Executive Director Products Aluminium radiators, charge air cooler, engine cooling assembly, intercooler, oil cooler, rubber components, sealing gaskets Plants India (4): Gujarat (2), Jharkhand, Uttrakhand Sales INR8.4bn (USD185.9m, 31 March 2011) Employees e. 750 (31 March 2011)
Banco Products is a major supplier of engine cooling components and engine sealing gaskets to the automotive industry. The company's product portfolio includes radiators, intercoolers, oil coolers and engine gaskets. In addition to automotive, the company supplies its components for use in power, earthmoving and industrial engines. The company derives nearly a quarter of its sales from exports.
Incorporated in March 1961, Banco Products began its automotive operations offering industrial radiators, heat exchangers and gaskets in 1988. The company operates four manufacturing plants in India of which two are in Baroda and Bharuch in Gujarat and one each in Jamshedpur, Jharkhand and Rudrapur, Uttrakhand. Banco Products is a major player in gaskets, heat exchangers and radiator segments. The company supplies its products to all-leading OEMs in India and has a considerable presence in the export markets. In the domestic market, the company generates around 80-85% of sales from OEMs and the rest from the aftermarket. The company caters to two-wheelers, passenger cars and commercial vehicles. Banco Products major customers include Ashok Leyland, Bajaj Auto, Hero MotoCop, Honda Scooter and Motorcycle, Maruti Suzuki, Mahindra & Mahindra, Tata Motors, TAFE, TVS Motor and Yamaha. In addition to the domestic market, Banco Products exports to Case New Holland Imola, Italy and Jungheinrich Manufacturing, UK as well as to Africa, South East Asia, Middle East and western Europe. Recent Developments Corporate strategy Banco Products is focusing on increasing its presence in international markets. Under the strategy, the company acquired the Netherlands-based Nederlandse Radiateuren Fabriek (NRF) in the financial year 2010. The acquired company makes heat exchangers. The acquisition is expected to help Banco expand its presence in the European market. Meanwhile, the company has also invested in capacity expansion in India to meet surging demand in the local automotive industry. In 2010, Banco Products started operations at it Rudrapur facility in the state of Uttarakhand to manufacture cooling systems. Banco Products is a leading exporter of aftermarket radiators to Europe. The company is increasing exports to other major markets such as North America, Middle-East, Africa and South America. Banco Products has set up a 100% export oriented unit (EOU) in Baroda, Gujarat (India) to cater to exports. Acquisitions In March 2010, Banco Products acquired a 100% stake in Nederlandse Radiateuren Fabriek B.V. (NRF) for EUR17.7m (USD23.8m). The Netherlands-based company manufactures radiators, oil-coolers and aircoolers for the automotive segment.
Investments In March 2010, Banco Products commenced production at its Rudrapur facility in Uttarakhand (India). The facility manufactures cooling systems. In 2006 Banco Products started production of aluminium radiators at its export oriented unit in Baroda, Gujarat (India). The company invested around INR200m (USD4.5m) to establish the facility.
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Certifications Banco Products has been accredited with ISO/TS 16949 and ISO9001 quality certifications. The company is working to receive ISO14001 and OHSAS certifications.
New Product Developments Banco Products spent INR28.8m (USD63,957)

on research and development in fiscal year ended 31 March 2010. The companys R&D expenditure was equivalent to 0.9% of its sales. The company continues to focus on adoption of new technologies and process.
Banco Products has a technical alliance with Japan Metal Gaskets Co., (Japan) for technical know-how for gaskets. Additionally the company has design support from Germany-based ElringKlinger for non-retorque cylinder heat gasket manufacturing. Financial Overview For the financial year ended 31 March 2011, Banco Products sales increased by 83.1% to INR8.4bn (USD185.9m, 31 March 2011) compared with INR4.6bn (USD102.4m, 31 March 2010) for the same period in 2010. The company benefited from strong growth demand for its products in the Indian automotive market. In addition, the companys sales surged as a result of integration of NRF business acquired in 2010. However, the company's profit before tax declined by 13.8% to INR852.3m (USD18.7m) against INR989.4m (USD21.9m) in the previous year. Net profit was also down 16.5% to INR656.3m (USD14.4m) from INR786m (INR17.4m) in 2010. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 8,442.4 4,611.8 2,879.1 2,988.5 2,602.1 Net Sales (USDm) 185.9 102.4 55.2 74.9 59.9 Profit Before Tax (INRm) 852.3 989.4 479.0 513.1 303.5 Profit Before Tax (USDm) 18.8 22.0 9.2 12.8 7.0 Net profit (INRm) 656.3 786.0 414.6 433.0 252.6 Net profit (USDm) 14.4 17.4 7.9 10.8 5.8
*Financials till 2009 are standalone figures as sales of Kilimanjaro Biochem and NRF are not included
Outlook Banco reported a significant increase in sales over the past two financial years. This could be mainly as a result of contribution from the integration of Nederlandse Radiateuren Fabriek (NRF). Thus the company looks optimistic as the operations have now expanded in the overseas markets. Also, the Indian market has seen a significant growth in the past few years and many automakers have established their manufacturing facilities domestically. This will provide an opportunity for the company to expand its customer list in the local market. Like most of the suppliers, rising metal prices is a major risk for Banco. In addition, continuing uncertainty in Europe, its most important market outside India, is another major concern which could impact its business.
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Bharat Forge
Forged and machined components
Address Bharat Forge Ltd Mundhwa, Pune Cantonment Pune - 411 036 Maharashtra India Tel: +91 20 2670 2476 Fax: + 91 20 2682 2163 Internet: http://www.bharatforge.com Senior Officers Baba N Kalyani, Chairman and Managing Director G K Agarwal, Deputy Managing Director Amit B Kalyani, Executive Director B P Kalyani, Executive Director Sunil Kumar Chaturvedi, Executive Director, COO, Capital Goods Division P K Maheshwari, Executive Director S E Tandale, Executive Director Products Camshafts, connecting rods, control arms, crankshafts, front axle beams, pistons, piston crowns, rocker arms, spindles, steering arms, wheel carriers Plants India (4): Maharashtra Outside India: Germany (3), China (2), Sweden, USA Sales Group: INR50.8bn (USD1.14bn, 31 March 2011) (Year to 31.03.11) Employees Bharat Forge: 7,000
Bharat Forge is Indias leading supplier of forged and machined components. The company is the largest exporter of auto components from India and a major chassis component supplier in the world. In addition to automotive the company supplies its products to non-automotive sectors such as aerospace, railway, energy and power. The company generated 75% of its sales from the automotive business in financial year 2011.
Bharat Forge makes a wide range of forged and machined components for passenger cars, sport-utility vehicles (SUVs), light-, medium- and heavy-duty commercial vehicles. In addition, the company has recently started diversifying into non-automotive business with an aim to serving emerging sectors including aerospace, railway, energy and power. The company generated 75% of 2011 consolidated sales from the automotive segment and the remaining 25% from the non-automotive segment. The company has global manufacturing presence with 11 facilities across five countries in Asia, Europe and North America. This include four plants in India, three in Germany, two in China, and one each in Sweden and the US. In financial year 2011, the company generated 59% of its stand-alone sales from India, 20% from USA, 18% from Europe and 3% from others. In automotive, Bharat Forge supplies to major global automakers as well as tier one suppliers. Among automakers, the company supplies to Ashok Leyland, BMW, Chrysler, Daimler, FAW, Ford, GM, IVECO, Honda, Renault, Toyota, Volkswagen and Volvo. Bharat Forge supplies to tier one suppliers including Meritor, Cummins, Dana, Detroit Diesel, CaterpillarPerkins and Yuchai International. Recent Developments Corporate Strategy After establishing a strong global presence in the automotive business, primarily through several acquisitions, Bharat Forge has shifted its focus to non-automotive business. In 2006, the company set up a goal to generate 40% of its financial year 2012 sales from non-automotive business. Part of the reason behind this paradigm shift in Bharat Forge's strategy is to de-risk its business from overdependence on the volatile automotive industry. In addition, the company foresees tremendous growth potential in the nonautomotive sectors such as aerospace, railways & marine, energy, oil & gas and capital goods. In the last four years, the company has entered into strategic partnerships with many international players, including Rolls-Royce in aerospace, Alstrom Power in power and National Thermal Power Corporation (NTPC) in energy. Bharat Forge has commissioned its new fully-integrated Ring Rolling Facility at its Centre for Advanced Manufacturing at Baramati, Maharashtra (India). This facility caters to the wind energy, thermal power, defence, oil & gas, material handling equipment and bearing industry. Despite this, the auto component will continue to remain the flagship business of Bharat Forge for many years to come. In May 2011 the company announced that it was planning to boost forging capacity by 15% and raise machining capacity for crankshafts by establishing a heavy press line. In June 2010, the company entered into an agreement with KPIT Cummins Infosystems to produce a hybrid engine technology. The two partners are planning to invest INR1bn (USD21.5m, 30 June 2010) to set up a new manufacturing facility for hybrid engine technology in Pune, Maharashtra (India). In light of the slowdown in the automotive industry in 2009, which led to
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sharp decline in the companys demand in North America and Europe, Bharat Forge announced comprehensive restructuring. The company closed its manufacturing facility in Scotland and shifted productions to another facility in the region. Overall in the automotive business, Bharat Forge continues to pursue what it terms as a dual-shore manufacturing model. Strong exports, in combination with successful integration of the acquired businesses, have enabled the company to pursue this strategy. The model aims to ensure uninterrupted supply of components to the companys customers, while providing a longterm cost advantage. The concept is mainly based on an objective of establishing more than one manufacturing locations for all core components; one close to the customer and one in low cost regions including India. Bharat Forge is working to offer its customers dual-shore model for design, forging manufacturing and machining capabilities. Investments In November 2006, Bharat Forge established a research and development (R&D) centre in USA. The centre focuses on engineering, R&D and design. The company already has a similar facility in Europe. In August 2006, Bharat Forge announced plans to set up a multiproduct special economic zone (SEZ) in Khed, Maharashtra (India) in collaboration with the government of Maharashtra. The project will cover 2,000 hectares and will initially require an investment of INR20bn (USD430m, 31 August 2006). The investment may scale up to INR90bn (USD1.93bn) over the next five to seven years. The company also expects the area to be expanded to 5,000 hectares. The SEZ is expected to attract investment of about INR250bn (USD5.37bn) and generate 120,000 new employment opportunities. In January 2006, Bharat Forge decided to invest INR4bn (USD90.6m, 31 January 2006) in a greenfield facility in Pune, Maharashtra (India) for larger products, sub-assemblies and value-added products and development centre at its offshore locations. The company doubled the forging capacity at its Pune unit to 250,000 tonnes in March 2006. Joint-Ventures In June 2010, Bharat Forge entered into a 50:50 joint-venture agreement with KPIT Cummins Infosystems to produce hybrid engine technology. The two partners agreed to invest INR1bn (USD21.5m, 30 June 2010) to set up a new manufacturing facility for hybrid engine technology in Pune, Maharashtra (India). The technology, termed as Revolo will enable both existing and new vehicle increase fuel efficiency and engine performance, while decreasing greenhouse gas emissions. Under the agreement KPIT Cummins will license the plug-in hybrid technology to the JV, while Bharat Forge will manufacture the product. The technology will be introduced in the market within six months. The JV will supply the product for both the OE and aftermarket. Contracts: OEM/Brand Tata Toyota Mahindra Mahindra & Model Ace Innova Xylo Component Engine shaft, front axle beam, transmission parts Transmission gears Transmission gears
New Product Development Bharat Forge spent INR75.2m (USD1.7m, 31 March 2011) on research and development (R&D) in the financial year ended 31 March 2011, compared with INR28.5m (USD0.6m, 31 March 2010) in the previous year. The company conducts most of its R&D activities in-house. Bharat Forges R&D team with over 100 engineers has been working on various projects including developing technologies to minimise carbon footprint and reducing product weight which will be translated into lower energy consumption. Other than its in-house research activities, Bharat Forge sponsors six programs in German universities to develop technologies in its area of business. The company has recently received a patent for micro alloy steel while another patent is pending with the authorities.
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Financial Overview For the financial year ended 31 March 2011, Bharat Forge reported a 50.1% increase in net sales to INR50.9bn (USD1.14bn, 31 March 2011) compared with INR 33.3bn (USD739m, 31 March 2010) in the previous year. Higher sales were primarily due to the strong revival in performance in automotive business as a result of an increase in the global vehicle production during the year.
Both domestic sales and exports experienced growth due to continued momentum in the Indian market as well as recovery of commercial vehicle markets in Europe and North America. The domestic sales grew by 50.3% while exports grew by 72.6% over the previous financial year. During the financial year, the non-auto segment became the single largest business unit for the companys Indian operations. The non-automotive business units contribution to the stand-alone business increased from 30% in 2010 to 37% in 2011. Higher sales led the company to record a more than fourfold increase in profit before interest and tax from (PBIT) INR1.4bn (USD32.1m, 31 March 2010) to INR5.97bn (USD131.6m, 31 March 2011). Bharat Forge reported profit before tax (PBT) of INR.4.4bn against loss before tax in the previous fiscal of INR647m. The company concluded the year with a net profit of INR2.9bn (USD63.8m, 31 March 2011) compared to a net loss of INR634.2m (USD14.02m, 31 March 2010) a year ago. Going forward, Bharat Forges financial performance will be classified as components and capital goods segments. The components segment will comprise both auto and non-auto components businesses, while the capital goods segment will include the companys business in the recently diversified power sector. Year Net Sales (INRm) Profit before Interest and Tax (INRm)
5,974.2
Profit before Tax (INRm) 4,368.7 (647) 1,102.3 4,498.7 4,363.2 Profit before Tax (USDm) 96.2 (14.4) 21.1 112.7 100.4
Net Profit (INRm)
2011 2010 2009 2008 2007 Year
50,872.9 33,275.9 47,750.9 46,522.8 41,783.0 Net Sales (USDm)
2,899.1
1,444.8 3,734.5 5,766.9 5,551.6 Profit before Interest and Tax (USDm) 131.6 32.1 71.6 144.5 127.8
(634.2) 582.6 3,015.2 2,905.9 Net Profit (USDm)
2011 2010 2009 2008 2007
1,120.6 739.0 915.2 1,166.0 961.8
63.8
(14.0) 11.2 75.6 66.9
showed significant recovery in 2011. The company benefited from strong growth in vehicle demand in the domestic market during the year. Bharat Forge also gained from its recent focus in the area of non-automotive segments through winning new businesses. This is reflected in the growing share of non-automotive business in its sales which reached 25% during the year. The automotive sector remains the companys main business accounting for 75% of its sales during the year. However, the companys growth in the domestic market in fiscal 2012 has come under pressure amid moderating vehicle demand in India, caused by macroeconomic fundamentals, such as rising fuel prices, spiralling inflation and increasing cost of financing. But the company could take some comfort in the fact that the commercial vehicle segment, which contributes to 87% of its stand-alone sales, is still doing well. Bharat believes that its de-risk business model will help it continue recording growth despite unfavourable business environment prevailing in India. The company also expects strong exports and performance in non-automotive business to mitigate the impact
Outlook After a dismal performance in financial year 2010, Bharat Forge
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of slowdown in domestic vehicle demand. Meanwhile, Bharat Forge believes that the slowdown itself is a temporary aberration, as the medium to long term outlook of the Indian vehicle market continues to remain robust. Therefore, despite the slowdown in the domestic demand, the company continues to invest in capacity expansion in order to prepare itself for the next phase of growth.
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Bharat Gears
Gears, gearboxes, furnaces
Address Bharat Gears Limited Hoechst House Nariman Point Mumbai-400 021 India Tel: +91 22 2288 3180 Fax: +91 22 2535 1651 Internet: http://www.bharatgears.com Senior Officers Surinder P Kanwar, Chairman & Managing Director Sameer Kanwar, Joint-Managing Director Jagdeep Singh, Business Head, Aftermarket SK Mittal, Head, Material & Central Purchase Milind Pujari, CFO PC Kothari, Head, Finance & Accounts KK Deshpande, Head, OE Marketing & Business Development NV Srinivasan, Director, Technical Products Axle shafts, brass rings, crown wheel, differential cage, differential gears, furnaces, gear boxes, gearbox housing, heat treatment furnaces, pinions, ring gears, straight bevels, transmission gears, transmission shafts Plants India(2): Haryana, Maharashtra Sales Group: INR3.3bn (USD72.1m, 31 March 2011) (Year to 31.03.11) Employees Group: 29,570 (31 December 2009)
Bharat Gears is the largest gear manufacturer in India. The company makes a wide range of gears and heat treatment furnaces for the automotive industry. The company largely caters to commercial vehicles, farm machines and construction equipment.
Bharat Gears Limited (BGL) is promoted by Bharat Steel Tubes and Raunaq & Co. The company was incorporated in 1971 to manufacture automotive gears including spiral bevel, straight bevel, spur and helical and worm gears, gear boxes, forgings and continuous gas carburising furnaces. The company operates two manufacturing plants in India one located in Faridabad, Haryana and another in Thane in Maharashtra. The plants have annual capacity to produce 660,000 hypoid ring gear & pinion units, one million differential gear & crosses units and 3.2 million transmission gear units. The company organises its business into three operating divisions Gears, BGL Furnace and BGL Automotive Components. The Gear division deals in ring gears & pinions, transmission gears & shafts, differential gears and gear boxes. BGL Furnace makes batch and continuous heat treating furnace systems. The company has over 110 units of heat treating furnace systems in service at its customers in India. BGL Automotive Components segment supplies a diverse range of components including axle shafts, clutch, differential cages, driveline products, flywheel assemblies, propeller shafts components, steering components, steel wheel rims, turbo chargers and parts and U-J crosses. Bharat Gears has had a technical alliance with US-based AFC Holcraft for furnace manufacturing since 1983. Two years later, the company entered into a technical and financial collaboration with Germany-based ZF Friedrichshafen AG to manufacture gear boxes. In addition, Bharat Gears has a tie-up with Spicer India, a leading manufacturer and supplier of light-axle assemblies to major players in this sector. The company supplies to both automakers and tier one suppliers. Among automakers, Bharat Gears major customers include Ashok Leyland, Escorts, Hindustan Motors, JCB, John Deere, Mahindra & Mahindra, New Holland, TAFE, SML Isuzu and Tata Motors. The companys customers among tier one suppliers include Axle India, Dana, Eaton, Spicer India, Toyota Kirloskar Auto Parts and ZF. Recent Developments Corporate strategy Bharat Gears is primarily focusing on commercial vehicles and farm tractor segments of the automotive industry. In the passenger car market, Bharat Gears is a marginal player but the company has achieved some success with the contract to supply the Tata Ace four-wheeler pick-up program lately. While India remains its primary market, Bharat Gears is concentrating on growing its exports; mainly to the US. The company recorded a strong growth in demand for its products in financial year 2011, driven by recovery of commercial vehicles segment in India and the US, its two major markets. In India, the company also benefited from continuing government support to the agricultural sector and the removal of excise duty on tractors. Bharat Gears aims to have optimal manufacturing capacities that can allow it on the one hand to effectively serve the market during the periods of high demand, while on the other carry the company through difficult time. Therefore the company has been careful in adding capacities. However, in response to the expected surge in vehicle demand in India, the company is considering setting up its third manufacturing plant in India. The company has already purchased the requisite land for the plant in Satara, Maharashtra (India). However, the company is yet to come out with a detail expansion plans regarding total investment and capacity of the new plant.
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Managing costs is another major focus area for Bharat Gears. The company has utilised the period of low demand to look inward and streamline costs. The company continues to look for new ways to optimise operating costs. For example, Bharat Gears has converted the energy source for power at its Faridabad plant in Haryana (India) from diesel to piped natural gas (PNG). The company is also in the process of converting its furnaces from being based on Propane to relatively low-cost PNG. Investments In 2011, Bharat Gears is planning to set up its third manufacturing plant in India. The company has already purchased the requisite land for the plant in Satara, Maharashtra (India). However, the company is yet to come out with a detail expansion plans regarding total investment and capacity of the new plant. Financial Overview For the financial year ended 31 March 2011 Bharat Gears reported a 32.4% increase in net sales to INR3.3bn (USD72.1m, 31 March 2011) compared with INR2.5bn (USD54.7m, 31 March 2010) in the previous year. The company benefited from the strong growth in the Indian automotive market during the year, especially its target markets. During the financial year, commercial vehicles sales increased in India by 32.6% while the farm tractor segment recorded a 24% increase in sales compared with the preceding year. Higher sales led Bharat Gears to report a significant 51.2% increase in profit before tax to INR145.6m (USD3.2m) compared with INR INR96.3m (USD2.1m) in the previous year. The company recorded strong growth in earnings despite a steep hike in prices of raw materials, including steel. Bharat Gears witnessed a 35.8% increase in cost of materials to INR1.6bn (USD35.2m) over INR1.2bn (USD26.6m) in the previous financial year. The company posted a net profit of INR97.1m (USD2.1m), up 58.1% compared with INR61.4m (USD1.4m) in the previous financial year. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 3,305.1 2,462.4 2,385.3 2,360.0 1,969.4 Net Sales (USDm) 72.1 54.7 45.7 59.1 45.3 Prof before Tax (INRm) 145.6 96.3 55.0 147.5 117.2 Prof before Tax (USDm) 3.2 2.1 1.1 3.7 2.7 Net Profit (INRm) 97.1 61.4 40.4 100.8 87.8 Net Profit (USDm) 2.1 1.4 0.8 2.5 2.0
Outlook Bharat Gears expects strong growth in some of its business lines, driven by the continuing push by the government on developments in agriculture and infrastructure sectors. According to an estimate, tractor production in India is expected to increase from 4.2 million units currently to 7.2 million units by 2015. The company also expects production of construction equipment to grow from four million units to 10 million units. As a leading supplier of gearbox to these commercial vehicles and off-the road segment, Bharat Gears is well positioned to grow in coming years.
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Bharat Seats
Automotive seats
Address
Bharat Seats Limited, Plant No. 1 Maruti Udyog Joint-Venture Complex Palam, Gurgaon Road Gurgaon-122015 Haryana Tel: +91 124 2341 258/087 Fax: +91 124 2341 188 Internet : http://www.bharatseats.com
Bharat Seats is a major supplier of seat assemblies to Maruti Suzuki. The company is part of the Relan Group which also manufactures other components such as sheet metal, airconditioning body parts and exhaust systems for the automotive industry.
Bharat Seats was established as a three-party joint-venture between Suzuki Motor, Maruti Udyog, now Maruti Suzuki, and the Relan Group in 1986 to supply seating systems to Maruti Suzuki. The company later added headrests and other interior components such as moulded carpets to its product portfolio. In addition to Maruti Suzuki, Bharat Seats manufactures seats, frames and sheet metal components for Suzuki Motorcycle India, the two-wheeler unit of Suzuki Motor. The company operates three manufacturing plants in India, all located in Gurgaon, Haryana. Bharat Seats main plant is located inside the Maruti jointventure complex, the vendor park. Bharat Seats supplies mainly to Maruti Suzuki which has a 14.81% shareholding in the seating system supplier. The company also supplies its products to two-wheelers manufactured by Suzuki. In addition to automotive, Bharat Seats began supplying seats to India Railways in 2008. The company caters to the Indian market only and is not engaged in any exports.
Senior Officers
N D Relan, Chairman Rohit Relan, Managing Director Ajay Relan, Director Rajat Bhandari, Vice-President, Strategic Planning Sanjeev Kumar, Chief General Manager, Finance
Products
Automotive seat assemblies and headrests, floor carpets
Recent Developments
Plants
India (3): Haryana (3)
Corporate strategy Bharat Seats is diversifying its product portfolio with a goal to becoming a complete automotive interior supplier. The company is working on developing seating systems, carpet moulding, luggage carpet and other interior parts. The company has commissioned in-house designing and testing capabilities to reduce product validation time. In 2010, Bharat Seats entered into a technical alliance with Japan based INOC to produce extruded components for Maruti Suzuki. The company is setting up a manufacturing plant in Gurgaon, Haryana (India) to produce extruded components. The facility is expected to become operational in financial year 2012-13. In addition to diversifying its product portfolio, Bharat Seat is focusing on expanding its customer base. Up until a couple of years ago, the company was generating its entire sales from Maruti Suzuki. However, the company is gradually working to add more customers. Bharat Seats started supplying seating systems to Suzuki Motorcycles in 2006. The company has also expanded its customer base to non-automotive segments and is supplying seats to Indian Railways. Investment In 2009, Bharat Seats invested in an additional polyurethane (PU) line to produce head rest pads. The company also invested in an additional assembly line to produce car seats for the new Wagon R. Joint-ventures In 2010, Bharat Seats entered into a technical alliance with INOAC of Japan to produce extruded components for Maruti Suzuki. The company is setting up a manufacturing plant in Gurgaon, Haryana to produce extruded components. The facility is expected to become operational in financial year 2012-13. Bharat Seats has a technical alliance for seat assemblies with Japan-based Houwa Kogyo Co. Ltd. Contracts In 2010, Bharat Seats started supplying seats for Maruti Suzukis new
Sales
INR4.4bn (USD97.2m, 31 March 2011)
Employees
c.225 (31 March 2007)
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WagonR. In 2006, Bharat Seats commenced supplying seating systems for Suzuki Motorcycles.
New Product Developments In financial year 2011, Bharat Seats spent INR20m (USD440,550) on research and development (R&D),which was equivalent to 0.5% of the companys sales. The company is engaged in developing seating systems, moulded floor carpets and luggage carpet for Maruti Suzuki.
Bharat Seats has a technical collaboration with Houwa Kogyo Co. Ltd. Japan. The company has another technical alliance with Toyo Seats of Japan for localisation of seat lifting mechanisms, which are currently imported. In 2010, the company entered into an agreement with INOAC Corporation, another Japanese supplier to begin production of extruded components for Maruti Suzuki. In 2010, Bharat Seats started producing polyurethane pads with its new developed technology called Dual Hardness. The technology enhances comfort in the seating systems.
Certifications In 2009, the government of India recognised Bharat Seats Seat Testing Laboratory ISO / IEC -17025 / 2005 accreditation by NABL. Bharat Seats has been accredited with ISO/TS 16949 and ISO14001 status.
Financial Overview In the financial year ended 31 March 2011 Bharat Seats
reported a 31.2% increase in net sales to INR4.4bn (USD97.2m, 31 March 2011) compared with INR3.4bn (USD74.6m) in the previous financial year. The company benefited from increase demand for seating systems from its major customer, Maruti Suzuki, which registered a 24.8% increase in vehicle sales to 1.3 million units. Higher sales led the company to report a strong growth in earnings compared with the previous financial year. During the financial year, Bharat Seats more than doubled its profit before tax to INR 114.4m (USD2.5m) compared with INR52m (USD1.2m) in the previous year. The company concluded the financial year with net profit of INR82.3m (USD1.8m) over INR38.4m (USD0.8m) in the previous financial year.
The company has recorded strong growth in profitability on capacity expansion, research and development initiatives and various cost saving measures. However, the company profitability came under pressure due to expenses incurred on expansion and competent market conditions. However, the company expects its profitability to improve in the medium to long run. Year 2011 2010 2009 2008 2007 Net Sales (INRm) 4,410.9 3,360.6 2,202.7 2,002.5 1,766.9 Profit Before Tax (INRm) 114.4 52.0 42.3 48.0 37.6 Net Profit(INRm) 82.3 38.4 27.6 32.3 29.3
Year 2011 2010 2009 2008 2007
Net Sales (USDm) 97.2 74.6 42.2 50.2 40.7
Profit Before Tax (USDm) 2.5 1.2 0.8 1.2 0.9
Net Profit(USDm) 1.8 0.8 0.5 0.8 0.7
Outlook Bharat Seats continues to overly depend on Maruti Suzuki for its
sales. This is unlike other associate suppliers of the automaker who have successfully diversified their customer base. Although Maruti Suzuki continues to dominate the Indian automotive industry, still accounting for nearly half of the total sales in the passenger cars segment, the situation may change in
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coming years considering intensifying competition among automakers operating in India. In addition, the overdependence on one automaker for revenue could badly impact the suppliers business if the OEM customer suffers problems. For example, frequent strikes at the one manufacturing plant of Maruti Suzuki in 2011, which resulted in cumulative production loss of more than 80,000 vehicles, impacted several key suppliers businesses. However, suppliers such as Bharat Seat were more severely affected due to their over-dependence on the automaker for sales. Bharat Seats has diversified its customer base to some extent through supplying to Suzuki Motorcycle and Indian Railways. The company needs to do more in order to reduce its business risks in coming years. Although over-dependence on Maruti Suzuki for sales remains a major concern for Bharat Seats, the company is taking a positive initiative in the area of securing more business from the automaker through diversifying its product portfolio. Over the years, the company has added new components to its product offerings such as sheet metal parts and moulded carpets. The companys latest initiative to start production of extruded components is expected to open more sources for revenues.
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Bhushan Steel
Automotive steels
Address Bhushan Steel Limited F-Block, 1st Floor International Trade Tower, Nehru Place New Delhi- 110 019 India Tel: + 91 11 4229 7777/5555 Fax: + 91 11 2647 8750 Internet: http://www.bhushan-group.org Senior Officers Brij Bhushan Singal, Chairman Neeraj Singal, Vice-Chairman & Managing Director Nitin Johari, Whole-time Director, Finance Rahul Sen Gupta, Director of Technical P K Aggarwal, Whole-time Director, Commercial Products Alloy billets, colour coated sheets, hardened strips, high tensile steel strapping, precision tubes, spring steels, tempered strips Plants India (3):Maharashtra, Orissa, Uttar Pradesh Sales INR70bn (USD1.3bn, 31 March 2011) (Year to 31.03.11) Employees 5,326 (31 March 2011)
Bhushan Steel is the third largest secondary steel supplier in India. The company is the only steel supplier in the country which offers a comprehensive range of automotive grade cold-rolled (CR) steel. The company supplies its products to the automotive and white goods industries.
Bhushan Steel was established in 1987. The company operates three manufacturing plants in India located in Sahibabad, Uttar Pradesh, Khopoli, Maharashtra and Meramandoli in Orrisa. Bhushan Steels two manufacturing plants in Sahibabad and Khopoli cater to automotive clusters in the National Capital Region (NCR) and western India respectively. The company has currently 1.25 million tonnes per annum (mtpa) Cold-roll capacity, at its Sahibabad and Khapoli plants. Of this total the company supplies 0.60mtpa to the auto and white goods sectors and the remaining capacity is used for galvanised and other value added products. The company has established a 1.9mtpa hot-rolled steel at its integrated plant in Meramandoli in Orrisa. The company manufactures billets, colour coated sheets, hardened strips, hightensile steel strapping, precision tubes, spring steels and tempered strips. Bhushan Steel has technical tie-ups with Ebner (Austria), Kvaerner Clecim (France), Waldrich Siegen, Heinrich George, Man B&W, LOI Thermoprocess, SMS Demag (Germany), Fimi (Italy), BHEL, Mecon, RITES (all India), Hitachi (Japan) and Daniel Corus, (Netherlands). Bhushan Steel supplies steels to the automotive and white goods industries. In the automotive industry, the companys major customers include Ashok Leyland, Fiat, Ford, Hindustan Motors, Honda Motorcycle & Scooter India, Honda Siel Cars, Hyundai India, Kirloskar, LML, Mahindra & Mahindra, Maruti Suzuki, Tata Motors and Yamaha. Bhushan Steel also exports its products to markets such as Australia, Chile, Mexico, New Zealand, Philippines, Portugal, South Korea and Spain. Recent Developments Corporate strategy Bhushan Steel has been working on a three-pronged corporate strategy that aims to facilitate backward integration, diversify client base and introduction of higher value-added products. The company is aiming for an across-the-board presence in the steel industry which includes improving profit margins by means of this vertical integration exercise. The company has commissioned a manufacturing plant in Meramandoli, Orrisa (India) that manufactures hot-rolled coils which is used as raw the material for production of the value-added secondary steel. This is expected to help the company in backward integration, through securing supply of raw materials, and improve its profitability. The company has also set up a captive power plant at Orrisa plant which will ensure uninterrupted production at the plant. In addition, the company acquired a 60% stake in Australia-based Bowen Energy, which has mining and exploration rights of coking coal, another raw material used in the production of steel. This is further expected to reduce Bhushan Steels reliance on external source for raw materials. Bhushan Steel is ramping up its capacity in order to meet the expected surge in demand from its customers, including from the automotive industry. The company currently has 100% order book for auto and white good sectors and is not able to meet the additional requirement from the fast growing automotive industry. Bhushan Steel is investing in 0.45mtpa at a cold-rolled complex at its Orissa plant and 0.50mtpa electric resistance welded (ERW) API pipe at the Khapoli plant which should go online in financial year 2013. The company is also expanding its hot-rolled capacity at its Orissa plan which will increase its capacity to 4.4mtpa.
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Joint-ventures In December 2009, Bhushan Steel and Sumitomo Metal Industries agreed to form an agreement under which the Japanese steelmaker would buy a substantial stake in Bhushan Steel's mega steel project in Asansol, West Bengal (India). Sumitomo may buy 26-40% stake in the venture which would be considered as part fund for the investment. Bhushan Steel has estimated an investment of INR200bn (USD4.3bn) which would include INR50bn (USD1.1bn) for a 1,000 MW captive power plant. The project is expected to be completed by 2015. However, the companys project is having some difficulty acquiring land for the plant in West Bengal. In addition, the planned merger of Sumitomo with Nippon Steel has also complicated the matter given the latter has an agreement with Tata Steel, a competitor f Bhushan Steel. In December 2009, Bhushan Steel formed a technical know-how and marketing agreement with Sumitomo for its 2.2MT steel plant in Orissa. Sumitomo has provided a team of technocrats to supervise the optimal and smooth running of operations with special focus on quality. The company will take the surplus production and sell it under their brand name in the Indian and overseas market. Investments In 2010-11, Bhushan Steel established its second steel-processing facility at Khopoli in Maharashtra (India). In fiscal 2010-11, Bhushan Steel announced production capacity expansion at its facilities in Khopoli, Maharashtra and Meramandoli, Orissa. The company is adding 0.50million tonnes per annum (mtpa) of electric resistance welded (ERW) pipes and 0.45 mtpa of cold rolled products capacity. The company said that they are also planning to set up valueadded processing capacity of 1.8mtpa at Orissa plant which would include a pickling line coupled with tandem cold mill. The expansion is expected to be completed by fiscal year 2013. In fiscal 2010-11, Bhushan Steel began expansion at its steel plant in Orissa to increase capacity of hot rolled (HR) steel. The expansion will increase the total HR capacity to 4.40mtpa by October 2012. Certifications Bhushan Steel has been accredited with ISO 9002 and QS 9000 certifications. New Product Developments Bhushan Steel is working on introducing Galume value added steel in India. Financial Overview For the financial year ended 31 March 2011 Bhushan Steel reported a 24.4% increase in consolidated net sales to INR60.7bn (USD1.5bn, 31 March 2011) compared with INR56bn (USD1.2bn, 31 March 2010) during the same period a year ago. The company benefited from strong growth in orders from the automotive industry which recorded strong growth in vehicle production during the year. Higher sales led the company to report 19.8% increase in profit before tax (PBT) to INR13.8bn (USD303m) over INR11.5bn (USD255.1m) in the previous financial year. Bhushan Steel concluded the financial year with net profit of INR10bn (USD221.4m) compared with INR8.4bn (USD187.2m) in 2010. Geographically, sales from India amounted to INR63.4bn (USD1.4bn) an increase of 33.5% from INR47.5bn (USD1.1bn) in the previous year. Sales from outside India slightly declined by 1% to INR12.1bn (USD266.5m) compared with INR12.2bn (USD270.9m) in 2010. Year 2011 2010 2009 2008 2007 Net Sales (INRm) 69,707.3 56,032.9 49,793.0 42,572.7 38,681.6 Profit Before Tax (INRm) 13,757.0 11,485.0 5,642.3 5,389.7 3,723.7 Net Profit (INRm) 10,051.3 8,431.8 4,247.5 4,237.7 3,132.6
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Year 2011 2010 2009 2008 2007
Net Sales (USDm) 1,548.0 1,244.3 954.4 1,067.0 890.4
Net Profit (USDm) 221.4 187.2 81.4 106.2 72.1
Outlook Bhushan Steel is a major supplier of value-added steel catering to rapidly growing automotive and white goods industries in India. The company has plants close to the automotive hub in NCR and Maharashtra and caters to all major automakers and component suppliers in these two clusters. As a major supplier of steel, which is used as raw material in production of components as well as vehicles, the company is well positioned to expand with the expected growth of the Indian automotive industry. With starting production of hot-rolled coiled steel, the company has fulfilled its aim of becoming a complete steel solution supplier. This has helped the company to secure a supply of primary steel which is used as a raw material in the production of secondary steel.
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Birla Corporation
Automotive interiors
Address Birla Corporation Limited 2nd Floor,1, Shakespeare Sarani Kolkata 700 071 West Bengal India Tel: +91 33 6603 3300/ 3301/3302 Fax: +91 33 2288 4426 Internet: http://www.birlacorporation.com Senior Officers Harsh V Lodha, Chairman B R Nahar, Executive Director & CEO P K Chand, CFO Alok Kumar, Vice- President, Co-ordinator, Auto Trim Division Products Door trims, headliners, parcel trays, pillar trims, trims Plants India Auto trim division (3): Haryana, Maharashtra, West Bengal Sales Group:INR24.2bn (USD532m, 31 March 2011) (Year to 31 March 2011) Auto Trim : INR113.3m (USD2.5m) Employees Group: c.9,818 (2011)
Birla Corporation is part of the MP Birla Group with interests in automotive trims, cement and jute. The automotive trim business supplies natural fibre-based interiors trim for the automotive industry.
In 1995, the Auto Trim division of Birla Corporation began utilising additional jute for producing natural fibre-based interiors from Birla Corporation's Birlapur (West Bengal) facility. The company has incorporated one-step technology for using recyclable thermoplastic material. The company has an installed production capacity of 780,000 pieces per annum and produced 64,000 pieces in 2010. Birla Corporation operates three auto trim facilities in India, one each at Birlapur, West Bengal; Chakan, Maharashtra and Gurgaon, Haryana. While the Birlapur facility supplies largely to Hindustan Motors, the Gurgaon facility supplies to Maruti Suzuki and the Chakan facility supplies to manufacturers in the western region. The company supplies door trims to Hindustan Motors, ICML, Mahindra & Mahindra, Maruti Suzuki and Tata Motors. Recent Developments Corporate strategy Birla Corporation has been supporting the use of natural fibrebased interiors over plastic-moulded components, which help to considerably reduce weight, cost and environment problems. Birla Corporation is aggressively marketing its environment-friendly products to OEMs, especially the commercial vehicle manufacturers. Another reason for Birla Corporation's sustained effort is the fact that norms in Europe require manufacturers to ensure that at least 90% of the car is recyclable. Birla Corporation expects similar norms to be enforced in India. Joint-ventures Birla Corporation has a technical collaboration with Germany- based Empe- Werke to manufacture moulded jute fibre reinforced door trims. Contracts Birla Corporation supplies door trims to the Maruti Alto. Birla Corporation supplies door trims to the Tata Safari. The company supplies interiors trims for pillars, and parcel trays for Hindustan Motors Ambassador. Birla Corporation has been awarded a contract to supply door trims to the face-lifted Mahindra Scorpio. Birla Corporation supplies trims to the Hindustan Motors-Mitsubishi Lancer. New Product Developments Birla Corporation has developed a jute composite-based headliner for the HM Hindustan Motors Ambassador. Certifications Birla Corporation facilities are accredited with ISO 9002, QS 9000 certifications. Financial Overview In the financial year ended 31 March 2011, Birla Corporation witnessed a 1.4% decline in consolidated net sales to INR21.3bn (USD468.6m) compared with INR21.6bn (USD479m) in the previous year. Although sales declined marginally, the company witnessed a sharp fall in earnings during the financial year. Birla Corporation witnessed a 42.4% decline in profit before tax (PBT) to INR4.4bn (USD96.5m) over INR7.6bn (USD96.5m) in the previous year. The company concluded the financial year with net profit of INR3.2bn (USD70.5m), down 42.5% from INR5.6bn
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(USD123.8m) in the previous financial year. The Auto Trim division was adversely affected due to lack of orders from OEMs. The division manufactured 21,511 units of door, a substantial decline of 66% from the previous 64,416 units. In financial year 2011, the Auto Trim business unit along with others minor businesses generated sales of INR113.3m (USD2.5m) compared with INR139.4m (USD3.1m) in the preceding year. The business unit reported a segment loss of INR29.8m (USD656,419) over loss of INR34.3m (USD761,710) during the year. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 21,274.4 21,570.3 17,906.8 17,248.1 15,668.3 Net Sales (USDm) 468.6 479.0 343.2 432.3 360.7 Profit Before Tax (INRm) 4,381.1 7,610.4 4,365.4 5,507.8 4,609.4 Profit Before Tax (USDm) 96.5 160.0 83.7 138.0 106.1 Net Profit (INRm) 3,202.1 5,573.1 3,235.9 3,931.9 3,254.9 Net Profit (USDm) 70.5 123.8 62.0 98.5 74.9
Outlook Auto trim is not a major focus area for Birla Corporation, who has interests in other businesses such as cement and jute, which together account for 99.5% of its sales. It seems that the company is continuing with this business unit because it has some orders from local automakers including Hindustan Motors, which is a company run by GP-CK Birla Group. The Auto Trim business units inability to win new business from the automakers has resulted in very low level of capacity utilisation of 8.2% in 2010 indicating a major demand crunch at a time when the automotive market is seeing doubledigit growth. Although Birla Corporations offering has found response from certain premium automakers as they favour natural-fibre based interior over plastic-moulded component, the company has so far not been able to tap these opportunities.
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Birla Tyres
Automotive tyres, tubes and flaps
Address Birla Tyres Limited Birla Building, 7th Floor 9/1 RN Mukherjee Road Kolkata - 700 001 West Bengal India Tel: +91 33 2262 4355-7 Fax: +91 33 2262 4359 Internet: http://www.birlatyre.com Senior Officers B K Birla, Chairman US Asopa, CFO & Senior Joint-President, Finance RK Shah, Joint-President, Commercial Anoj Agarwal, Joint-President, Works Anupam Dutta, Joint-President, Technical Preveen Mehta, Vice-President, Sales Hemant Kaul, Vice-President, Marketing SC Sood, Vice-President, Commercial Arindam Gupta, Vice-President, Production Kanti Chaudhury, Vice-President, Production PK Mitra, Vice-President, Engineering Products Flaps, tubes, tyres Plants India (2): Odisha, Uttarakhand Sales Kesoram Industries: INR54bn (USD1.2bn, 31 March 2011) (Year to 31.03.12) Birla Tyres: INR36.1bn (USD794.9m, 31 March 2011) Employees Kesoram Industries: 14,602 (31 March 2011)
Birla Tyres is part of the B K Birla Groups flagship company Kesoram Industries. The company manufactures truck, rear tractor, light truck, passenger bias and radial tyres, tubes and flaps. The tyre business accounted for 62.7% of Kesorams sales in financial year 2011.
Established in 1991, Birla Tyres operates as a division of Kesoram Industries, the flagship company of the BK Birla Group. During the same year, the company set up its first tyre manufacturing plant in Balasore, Odisha (India) in collaboration with Pirelli Ltd. UK., a subsidiary of Italy-based Pirelli SpA. In addition to Balasore, Birla Tyres operates one manufacturing plant in Haridwar, Uttarakhand (India) These two plants together have a daily capacity of 823 metric tonne (MT) of tyres, tubes and flaps. Birla Tyre caters to both original equipment (OE) and the aftermarket. However, the company has stronger presence in aftermarket. Birla Tyres has built a strong domestic distribution network of 10 zonal offices, more than 170 sales depots and 3,200 dealers. In addition to the domestic market, the company exports 15% of its production of bus and truck tyres to more than 50 countries. The companys major exports markets are Bangladesh, Vietnam, Middle East, Africa, Philippines, Afghanistan, South America and North America. Recent Developments Corporate strategy In the past few years, Birla Tyres has significantly diversified its product portfolio, which was initially limited to the medium and heavy-duty commercial vehicle (M&HCV) segments. The company now caters to passenger cars and light commercial vehicle (LCV) segment. As the momentum is still dominant towards the commercial vehicle space owing to the consumption pattern of the Indian tyre industry with over 70% of the tyre shipments being cornered by commercial vehicles Birla Tyres has been making progressive investments to tap the rapid radialisation in the commercial vehicle segment. To capitalise on the growth potential, Birla Tyres has planned investments at its two facilities Balasore and Haridwar to increase production capacity of truck and bus radial tyres. The company invested INR8bn (USD178.2m) in the capacity expansion which increased daily production capacity at the two plants to 988 MT per day. Joint-ventures Birla Tyres has a technical tie-up with Pirelli, UK. Investments In July 2011, Birla Tyre announced plans to invest INR3.5bn (USD77.9m, 7 July 2011) and INR4.5bn (USD100.3m) at its Haridwar and Balasore facilities, respectively. The company will increase production of truck and bus radial tyres at Haridwar plant by 85 tonnes per day and passenger car radial tyres at Balasore plant by 80 tonnes per day. The capacity expansion completed in 2011. In June 2007, Kesoram Industries, Birla Tyres parent company, announced a INR7bn project to establish a greenfield manufacturing facility at Haridwar, Uttarakhand (India). The plant became operational in 2010. Contracts Birla Tyres supplies to Tata Motors on a just-in-time basis. New Product Developments Birla Tyres has added ZYNO DLX tyres to its DLX range truck tyres. The new tyre has a premium depth tread pattern for extra mileage and improved casing provides additional retreads.
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Birla Tyres included BT 339 Platinum truck tyre to its range. The tyre has an increased rubber volume with extra deep tread.
Certification Birla Tyres manufacturing facility is ISO 9001, ISO 14000 and QS 9000 certified. The company has also won the TPM excellence award from the Japan Institute of Plant Maintenance. Financial Overview In the financial year ended 31 March 2011, Kesoram Industries reported 14.1% increase in net sales to INR54bn (USD1.2bn, 31 March 2011) compared with INR47.3bn (USD1bn, 31 March 2010) in the preceding year. Higher sales wer4e driven by strong growth by Birla Tyres, through other businesses such as cement, rayon and chemical. Despite increase in sales Kesoram Industries suffered loss against profit in the previous financial year. The company reported loss before tax of INR 1.5bn (USD33.6m) against profit before tax (PBT) of INR4.7bn (USD105.6m) in the previous financial year. The company concluded the financial year with a net loss of INR2.1bn (USD46.3m) against net profit of INR2.4bn (USD52.7bn). Birla Tyres reported a 26.7% increase in sales to INR36.1bn (USD794.9m) compared with INR28.5bn (USD632.8m) in the previous year. The strong growth in sales was on the back of increased demand for tyres in the domestic market. However, the companys exports declined 12.1% from INR3.6bn (USD79.9m) to INR3.2bn (USD70.5m) in the previous financial year. Despite higher sales recorded during the financial year, the tyre business suffered from high cost of raw materials such as rubber, steel cord and oil. In addition, the company manufacturing operations at Balasore plant were disrupted for 18 days due to lock out while production at Haridwar plant was suspended due to floods. The business unit incurred segment loss of INR1.8bn (USD39.8m) over profit of INR2.7bn (USD60.9m) in the previous financial year. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 53,978.8 47,306.5 38,772.2 28,879.2 22,089.7 Net Sales (USDm) 1,189.0 1,050.6 743.1 723.8 508.5 Profit Before Tax (INRm) (1,523.4) 4,754.9 4,091.1 5,525.3 3,417.8 Profit Before Tax (USDm) (33.6) 105.6 78.4 138.5 78.7 Net Profit (INRm) (2,102.1) 2,373.4 3,787.4 3,833.5 2,656.8 Net Profit (USDm) (46.3) 52.7 72.6 96.1 61.2
Outlook Birla Tyres is one of the five tyre manufacturers in India after Apollo Tyres, MRF, JK Tyres and CEAT Tyres. These five domestic tyre makers together account for nearly 85% of turnover of the local tyre industry. However, high growth of the Indian automotive industry has encouraged several international tyremakers to enter the local tyre market. The global tyre makers such as Michelin, Bridgestone, Continental and Yokohama are gearing up for greater presence in the Indian tyre market through setting greenfield plants or expanding capacities at existing plants. This is expected to change the competitive landscape of the Indian tyre market in coming years. Tyre is the core business of Kesoram Industries which accounted for more than three-fifths of the companys total sales in financial year 2011. Compared to Birla Tyres, other rival tyremakers have made significant investments in the past two decades to expand capacities. As a result, other tyremakers have taken a significant lead over Birla Tyres in terms of growth. However, Kesoram Industries seems to have realised the high growth potential of its tyre business. Therefore the company is ramping up capacity including recently setting up a greenfield plant in North India. This is expected to help the company meet expected surge in demand from the Indian automotive industry.
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Bohra Rubber
Rubber components
Bohra Rubber supplies high-end extruded, moulded and speciality-assembled components for the automotive industry.
Bohra Rubber is the flagship company of the Bohra Group which has interests in oil processing and rubber component manufacturing. The group is also engaged in polymer processing and management of educational institutions. Bohra Rubber accounted for 77.7% of the Bohra Group sales in financial year 2011. The company manufactures a diverse range of extruded, moulded and assembled components. Bohra Rubber operates a manufacturing plant in Ballabhgarh, Haryana (India). As of 31 March 2011, the company had 220 employees. Bohra Rubber supplies extrusion products to AMW, Ashok Leyland-Nissan, Ashok Leyland-John Deere, JCB, International Motors, Mahindra & Mahindra, SML Isuzu, TAFE, Tata Motors and Volvo Eicher Commercial Vehicles. In addition, the company supplies to tier one supplies including Delphi Harrision, Delphi Packard, Delphi Thermal System, Denso Kirloskar, Fiem, Hi-Lex-Nippon, Indo Japan Limited, Lumax, Marelli Motherson, Showa India and Visteon India. Recent Developments Corporate Strategy: Bohra Rubber is planning to set up its second manufacturing plant in India, and is looking for a suitable site for plant in the Karnataka state. The strategic location of the state is expected to help the company supply its customers in both western and southern parts of the country cost effectively. The company currently caters to these customers through its Ballabhgarh manufacturing plant. The company also intends to set up its third plant in Gujarat in another two years (by 2014) to supply automakers and tier one suppliers who are setting up plants in the state, which has, in a relatively short time span, emerged as an automotive cluster. Investment In 2011, Bohra Rubber expanded its Ballabhgarh plant in Haryana (India) to 60,000 ft2 to double its shop floor area. The company now has an independent moulding shop floor. The company has accordingly expanded its compounding shop floor area at the plant. Certificates Bohra Rubber plant is accredited with TS16949 certification. Financial Overview In the financial year ended 31 March 2011 Bohra Rubber reported a 66.5% increase in sales to INR146.5m (USD3.2m, 31 March 2011) compared with INR88m (USD2m, 31 March 2010) a year ago. The company benefited from strong growth in orders from both OEMs and tier one suppliers. Bohra Rubber accounted for 77.7% of the Bohra Groups sales during the financial year. For the financial year ending 31 March 2012, the company is expecting a 46.7% increase in sales to INR215m (USD4.7m). Bohra Rubber is a privately owned company wholly-owned by the Bohra Group. Therefore, the company is not obliged to publish details of its financial performance. Outlook Bohra Rubber has recorded strong top line growth in the past three years with sales almost tripling from INR50.5m (USD1m) in the financial year 2009 to INR146.5m (USD3.2m) in 2011. The company expects to maintain its growth in financial year 2012 despite some moderation in demand from the passenger car segment. Bohra Rubber enjoys a diverse customer base, comprising automakers and suppliers. The company expects that any possible decline in orders from one segment will be offset by increased orders from other Address Bohra Rubber Private Limited Main Bazar Ballabgarh-121004 Haryana India Tel: +91 129 4062 692/693 Fax: +91 129 4062 695 Internet: http://www.bohrarubber.com Senior Officers Shailendra Bohra, Owner and Director, Marketing Amit Bohra, Director Sumit Bohra, Director Products Bellows, body and cradle mounts, door weatherstrips, dust caps, engine mounts, exhaust hangers, inner and outer beltstrips, secondary seals, quarter window weatherstrips, decklid seals, roof rail weatherstrip, glass run weatherstrips, windshield mouldings, hood-to-cowl weatherstrips, rubber bushes, rubber housings, strut mounts, suspension kits, transmission mounts Plants India: Haryana Sales INR146m (USD3.2m, 31 March 2011) Employees 220 (March 2011)
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segments of the automotive industry. However, the consistently high raw materials prices have impacted Bohra Rubbers margins, although the company does not provide details of its earnings. Bohra Rubbers extensively uses imported high quality polymer such as natural and synthetic rubber, and filler and processing oil. Prices of these raw materials have remained high in the past few years and the company has borne the brunt of high cost of production which has impacted its margins. Of late the strong depreciation of the rupee against major global currencies has also impacted its margins.
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Bosch India
Diesel fuel injection equipment, electronic systems, gasoline systems and spark plugs
Address Bosch Limited Post Box No. 3000 Hosur Road Bangalore - 560 030 Karnataka India Tel: +91 80 2222 2393/ 2299 2111 Fax: +91 80 2227 2728 Internet: http://www.boschindia.com Senior Officers Albert Hieronimus, Chairman V K Viswanathan, Managing Director Manfred Duernholz, Joint Managing Director Soumitra Bhattacharya, CFO, Alternate Director S Muralidharan, Vice-President, Aftermarket Products Air filters, auto electrical- starter motors and alternators, automotive relays and gear pumps, brake systems, clutch plates, diesel filter inserts, diesel fuel injection equipment, glow plugs, glow resistors, halogen bulbs, horns, hydraulic gear pumps, ignition coils, industrial equipment, lube oil inserts, miniature lamps, spark plugs, stop and tail lamps, V-belts, voltage regulators, wiper blades Plants India (13): 13 Manufacturing facilities across Gujarat, Karnataka, Maharashtra and Tamil Nadu Sales Bosch Group India: INR110bn (USD2bn, 31 December 2011) (Year to 31.12.11) Bosch Limited: INR80.2bn (USD1.47bn, 31 December 2011) Employees 25,000 (2011)
Bosch is one of the leading automotive suppliers in India. The company manufactures a wide range of automotive components, including safety systems, gasoline & diesel systems, energy & body systems and brake systems. In addition to automotive, the company caters to industrial technology and consumer and business technology.
Bosch has been present in India since 1953. Over 60 years, the company has emerged as one of the leading component suppliers in the country. Currently, the company operates 13 manufacturing plants and four development centres in India and employs 22,500 people. All three business units of Bosch Automotive Technology, Industrial Technology and Consumer and Business Technology have presence in the country. Automotive Technology is the largest business unit of Bosch in India. The company operates in Diesel Systems, Gasoline Systems, Chassis Brakes, Automotive Accessories, Car multimedia, Starters and Generators, Energy and Body Systems, Electrical Drives, Spark Plugs and Glow Plugs segments. Bosch supplies to all major automakers in India. The companys major customers in the country include Ashok Leyland, Eicher Motors, Ford India, Hyundai, Mahindra & Mahindra, Maruti Suzuki and Tata Motors. In addition to OEMs the company has strong presence in the aftermarket segment Recent Developments Corporate strategy Bosch continues to focus on strengthening its presence in India. In January 2012, the company announced its plans to invest INR30bn (USD596.3m, 31 January 2011) in India over the next three years (2014) to expand its operations and technologies. The company will invest in setting up new plants as well as expanding capacities at existing plants. In May 2011, Bosch, along with its joint-venture partner Igarashi Motor, is investing INR370m (USD8.1m, 31 May 2011) in a new manufacturing plant in Chennai, Tamil Nadu which will produce components such as wiper systems, engine cooling fan modules, air-conditioner blowers and electric window lift drives. The plant will be operational by the end of 2012. In addition, the company is currently investing in capacity expansion at its existing manufacturing facilities located in Nashik, Maharashtra; Jaipur, Rajasthan and Ahmadabad, Gujarat (all in India). The company has increased classic nozzle holder production capacity at its Nashik plant from 17,000 units a day to 26,500 units while DSLA nozzle capacity has been ramped up from 18,000 units a day to 33,000 units per day. Bosch has expanded production area at the plant by 33,000m2. The company is commissioning new hangers to expand capacity at Jaipur plant to add capacity. Bosch is also setting up a new plant in Ahmadabad to produce hydraulic valves, power units, control blocks and cylinders. The plant will have floor area of 37,000m2 and it is expected to be operational in the first half of 2012. Bosch is concentrating on leveraging strong software capability in India. The companys engineers in India are set to assume global responsibility in software engineering support for electronic control units (ECUs). Their development work will focus on ECU for both internal combustion engine (ICE)-powered vehicles and alternate drivetrain-powered hybrid and electric vehicles (HEVs). In February 2011, the company announced it would set up a development centre for powertrain electronics in India which will work with Bosch's Diesel and Gasoline Systems-Electronic Controls (DGS-EC) business in the country. Bosch is strengthening its presence in the aftermarket segment. In November 2011, the company announced plans to invest INR2.5bn (USD47.8m, 30
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November 2011) over the next three years. The company will invest in ramping up car service centres to 750 to 800 outlets from the current 500 outlets across the country. The company expects to generate sales of INR30bn (USD574m), up 50% over INR20bn (USD383m) in 2011. Joint-ventures In February 2008, Bosch formed a 51:49 joint-venture (JV) with Igarashi Motors India Ltd to produce and supply DC motors and systems for wiper, HVAC, engine cooling and window lift applications in India. The company commenced its operations from a leased location in Chennai, Tamil Nadu. However in May 2011, the JV announced it would invest INR370m (USD8.1m, 31 May 2011) in a new manufacturing plant in Chennai. The plant, spread on an area of 9,000m2, will produce vehicle components such as wiper systems, engine cooling fan modules, airconditioner blowers and electric window lift drives. The plant is expected to be operational by 2012 and create 305 jobs over the next three years. Investment In January 2012, Bosch announced plans to invest INR30bn (USD596.3m, 31 January 2011) in India over the next three years (2014) to expand its operations and technologies. The company will also invest INR1.4bn (USD25.9m) to support its research initiatives in the country for the next 10 years. In February 2011, Bosch announced plans to invest INR3bn (USD65.1m, 28 February 2011) to establish a development centre for powertrain electronics in India. The development team will work with Bosch's Diesel and Gasoline Systems-Electronic Controls (DGS-EC) business in India. The company plans to increase its headcount by around 800 across its development centres in Bangalore, Karnataka and Coimbatore, Tamil Nadu (both in India) within the next two years. In February 2010, Bosch Chassis Systems India inaugurated a new manufacturing facility and a technical centre in Chakan, near Pune, Maharashtra (India). The company invested INR600m (USD13m, 28 February) in the manufacturing facility which will produce anti-lock braking systems (ABS). Bosch invested INR370m (USD7.9m) in the technical centre which has 70 engineers. The technical centre will provide services such as design, development and testing to Indian automakers. Also, the company expects the centre will extend its services to several international automakers who seek cost-effective solutions for their low or medium volume requirements. In June 2009, Bosch announced plans to establish a manufacturing plant in Sanand, Gujarat (India) to supply Tata Motors low-cost car Nano. Bosch set up its plant in Vendor Park being set up by Tata for Nano. The company manufactures brake solutions, fuel injection systems, electronic control units (ECU), starter motor and generator for the Nano. The plant became operational at the end of 2009. In August 2008, Bosch announced plans to invest INR4.5bn (USD102m) in its manufacturing facility in Nashik, Maharashtra (India). The company plans to double the production of commonrail injectors to 1.3 million units per year with this investment spanning over the next two years. The facility currently produces 500,000 units every year. In August 2007, Bosch announced it would INR2.5bn (60.7m, 31 August 2007) to setup a facility in Coimbatore, Tamil Nadu (India). The facility became operational in 2009. The facility focuses on technologies such as electronic control unit (ECU) for diesel and petrol engines. It is also engaged in the development of portable navigation systems, semiautonomous parking systems and adaptive cruise control. Contracts Bosch supplies gasoline engine and security systems to Tata Nano from its Naganathapura plant in Karnataka (India). In July 2008, Bosch secured contract from Tata Motors to supply engine components for Indica and Indigo models. In 2006, Bosch began supplies of hydraulic systems to Maruti Udyog. Bosch supplies diesel commonrail system for the Hyundai Accent and Elantra models. New Product Development Bosch operates four development centres in India. In February 2011, the company announced it would set up a development centre for powertrain electronics in India which will work with Bosch's Diesel
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and Gasoline Systems-Electronic Controls (DGS-EC) business in the country. Bosch operates its largest development centre in Bangalore, Karnataka (India), which is its largest outside Germany, to provide end-to-end engineering and technology solutions. In May 2011, Bosch India announced that it was developing a new 0.7 L diesel engine for Tata Nano. The company also worked with Tata for the development of 623cc gasoline engine which powers Nanos petrol variant. The two-cylinder diesel engine is expected to provide fuel economy of 40km/litre, the highest by any diesel-powered vehicles in India. In January 2006, Bosch launched its range of engine cooling systems in India. The company commenced supplies from its Naganathapura plant in Banagalore, Karnataka by late 2006.
Financial Overview In 2011, Bosch Group, including Bosch Limited in which the parent company has a 71.18% stake, reported sales of INR110bn (USD2bn, 31 December 2011 compared with INR97.2bn (USD2.1bn, 31 December 2011) in 2010. In the financial year ended 31 December 2011 Bosch Limited generated sales of INR80.2bn (USD1.47bn, 31 December 2011), an increase of 19.7% over INR66.3bn (USD1.45bn, 31 December 2010) in 2010. In the automotive business, the company benefited from the introduction of a new base line of alternators. This helped the companys Starters and Generators division to record 63.1% increase in sales over the previous financial year. Boschs Diesel System business recorded 19.2% growth, primarily on strong demand from light commercial vehicle (LCV) and tractor segments. The companys Automotive Aftermarket business recorded a yearover-year increase of 15.2% in 2011. The company recorded a strong 22.3% growth in exports during the financial year. The companys exports crossed the INR10bn (USD183m) mark during the year supported by strong demand from export markets in Germany, China, Brazil and South Korea. Higher sales drove the companys profit before tax (PBT) to INR15.7bn (USD288.7m), an increase of 30.9%. The company concluded the financial year with net profit of INR11.2bn (USD205.9m), up 30.7% compared with a year ago.
Outlook Bosch continues to believe in the growth of the Indian automotive market and is investing in additional capacities to meet expected surge in vehicle demand. The company has built a strong presence in the country over the past six decades with very diverse presence in automotive technology. The company was a pioneer in introducing new safety technologies in India such as anti-locking brake systems (ABS). Bosch expects to gain from increasing awareness of automotive consumers in India in improving safety and reducing fuel consumption and emissions.
Bosch has set up extensive development facilities in India to cater to its global product development programmes, specifically on IT functions. The company continues to expand product lines which could be supported from its development centres in India.
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Brakes India
Braking systems and ferrous castings
Address Brakes India Ltd Padi, Chennai-600 050 Tamil Nadu India Tel: +91 44 2625 8161 Fax: +91 44 2625 7844 Internet: http://www.brakesindia.com Senior Officers Badri Vijayaraghavan, Executive Director, Marketing V Narasimhan, Executive Director, Foundry Division P Krishna Kumar, Divisional ManagerOperations Products Boosters, brake assemblies, calipers, clutch fluid, heavy duty brakes, radiator coolant SG castings & engineered plastic compounds, master cylinders, valves, hoses, wheel cylinders Plants India: Gujarat, Haryana, Jharkhand, Karnataka , Maharashtra, Tamil Nadu (5), Uttarakhand Outside India: Oman Sales INR27.1bn (USD596.3m, 31 March 2011) (Year to 31.03.11) Employees 4,200 (2008)
Brakes India, a company of the TVS Group, is a major supplier of brakes and castings products for automotive and non-automotive applications. The company generates sales of over 60% from the domestic OEM market, while the remainder comes from exports.
Brakes India Limited began operations in 1962 as a joint-venture between TVS Group and the UK-based Lucas Industries (now merged into TRW) to manufacture braking components for automotive and other applications. The company commenced exports of brake components in 1968 and currently exports to over 35 countries. The company broadly categorises its operations in two divisions: Brakes Division: manufactures brake products including, drum brakes for commercial vehicles, trailer brakes for exports, tractor brakes, master cylinder and booster assemblies, and wheel cylinder assemblies. The division operates seven manufacturing plants across the country and employs 2,840 people. In financial year 2011, the company generated 82% of total sales from the Brake Division. Foundry Division: produces permanent mould die-castings, grey iron and ductile castings using the Disamatic process. The Division contributed 18% of Brakes Indias sales in financial year 2011.
The company has an installed capacity of 9.5 million brake system per year and 80,000 tonnes per annum of ferrous castings. Brakes India supplies a major part of its Grey Iron and Ductile Iron castings to TRW, Meritor and Bosch. Brakes India exports its products, to both overseas vehicle manufacturers and replacement markets, including hydraulic brake and clutch cylinders, kits, seals, brake and clutch hoses, brake pads, calliper pistons and lined shoe assemblies for various passenger cars and commercial vehicles manufacturers. Brakes India supplies to both automakers and tier-one suppliers. The companys customers among automakers include Ashok Leyland, Daimler India, Eicher Motors, Escorts, Fiat India, Force Motors, Ford India, GM India, Hindustan Motors, Honda Siel Cars, Mahindra & Mahindra, Maruti Suzuki, SML Isuzu, TAFE, Tata Motors, Toyota Kirloskar and Volvo. The company supplies to major tier-one suppliers including Akebono Brake, Bosch, Meritor and TRW. Recent Developments Corporate strategy Brakes India is expanding its product portfolio with the help of its technical collaborator and joint-venture (JV) partner TRW Automotive. In July 2010, the US-based safety system supplier agreed to provide licence of slip control systems (SCS) technology to Brakes India. The licence is expected to help the Indian supplier to provide manufacturing and local engineering development services to customers in India. TRW has been exporting complete anti-lock brake system (ABS) and electronic stability control (ESC) units to India. However, the company believes that transferring the SCS technology will allow greater presence and more effective customer support through Brakes India. The company is investing in expanding capacity to meet increased demand from its customers. In 2009 the company established a new manufacturing plant in Jamshedpur, Jharkhand (India). The new plant enabled Brakes India to effectively supply Tata Motors. In the Foundry Division, the company has increased its capacity at its Oman facility to 36,000 tonnes per annum since its inception in March 2008. Joint-venture In July 2010, TRW had announced it would provide licence of slip control systems (SCS) technology to Brakes India. The licence will help Brakes India to provide manufacturing and local engineering development services to the customers in India.
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Investments In 2009, Brakes India established a new manufacturing plant in Jamshedpur, Jharkhand (India). The plantm spread over an area of 16,600ft2, manufactures brakes components for Tata Motors. In March 2008, Brakes India set up foundry facility in Salalah (Oman) to meet global customer demands. The production began in April 2008 with a capacity of 18,000 metric tonnes per annum (MTPA). The capacity has now increased to 36,000 MTPA by adding one more production line. In 2007, Brakes India commissioned a greenfield brake assembly facility at Uttarakhand for supplying to Tata Motors and Mahindra & Mahindra. Contracts In 2008, Brakes India started supplying brake assembly systems to Maruti Swift Dzire, Mahindra Xylo and Honda City. In 2007, Brakes India started supplying brake assembly systems to Toyota Corolla and Altis, Maruti Suzuki SX4 and Tata Ace. In 2006, Brakes India started supplying brake assembly systems to MarutiSuzuki Zen Estilo and Swift, and Honda Civic. In May 2006, Brakes India announced orders worth EUR9m (USD11.5m, 31 May 2006) for its foundry division from Bosch for fuel injection components. Also in May 2006, Brakes India announced orders worth EUR4m (USD5.1m, 31 May 2006) for its foundry division from Volvo Powertrain for engine components. Brakes India has the contract to supply 50,000 brake assemblies per annum to the Maruti-Suzuki Swift programme. Certifications Brakes India was accredited with ISO 9002 certification in 1992 for the foundry division and with ISO 9001certification in 1993 for the brake division. New Product Developments Brakes India Limited spends around 2% of its turnover for engineering and research and development (R&D) activities. The company employs more than 185 engineers in its R&D department. The company continues to spend 2% of its turnover on research and development (R&D) activities which would further help the company to keep up with the market demand. Financial Overview For the financial year ended 31 March 2011 Brakes India reported a 37.4% increase in sales to INR 27.1bn (USD596.3m, 31 March 2011) compared with INR19.7bn (USD437.5m, 31 March 2010) a year ago. The company reported net profit of INR1.8bn (USD38.8m) compared with INR1.2bn (USD25.8m) in the previous financial year. Brakes India is privatelyowned and therefore does not publish details of its financial performance. Outlook Brakes India is expected to continue recording high growth on the back of its strong relationship with the OEM customers in India. The company has been following its customers and setting up new plants near the latters assembly plants to continue serving effectively. To this end, Brakes India set up plants in Jharkhand and Uttarakhand. In addition, the company hopes to benefit from the recent transfer of SCS manufacturing technology from its JV partner TRW Automotive. This will help Brakes India serve the OE customers in India and enable it to further extend its service globally in the future.
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Bridgestone India
Tyres
Address Bridgestone Corporation 10-1, Kyobashi 1-chome, Chuo-ku, Tokyo 104-8340, Japan Tel: +81 33567 0111 Fax: +81 33535 2553 Internet: http://www.bridgestone.com Bridgestone India Private Limited Plot No. 5/4, 5th Floor Shalimar Onyx, Mirchandani Park Off. Andheri Kurla Road Sakinaka, Andheri (East) Mumbai-400 072 Maharashtra India Tel: +91 22 4249 6400 Fax: +91 22 4249 6460 Internet: http://www.bridgestone.co.in Senior Officers Masaaki Tsuya, CEO Hiromi Tanigawa, Managing Director, Bridgestone India H Gonzlez Mori, Director, Sales & Marketing, Bridgestone India Vaibhav Saraf, Senior Deputy General Marketing, Bridgestone India Products Tyres Plants India (2): Maharashtra, Madhya Pradesh Outside India: Argentina, Australia (2), Belgium (3), Brazil (4), Canada, China (6), Costa Rica, France, Hungary, Indonesia (2), Italy, Japan (21), Mexico (3), Poland (2), South Africa (2), Spain (3), Taiwan, Thailand (5), Turkey, US (14), Venezuela Sales Group: JPY2.9trn (USD39.1bn, 31 December 2011) India: NA Employees Group: 142,865 (December 2011) India: NA
Japan-based Bridgestone Corporation is among the leading suppliers of tyres and other rubber components for passenger cars, trucks and buses. The company is also engaged in selling raw material for tyres and providing automotive maintenance and repair services. Bridgestone India, the Indian subsidiary of the Japanese tyremaker, is a major tyre supplier in India.
Bridgestone broadly divides its business into two operating segments: tyres (accounted for 84% of 2011 sales) and Diversified Products (16%). Within the tyre segment, the company manufactures automotive tyres for passenger cars, buses and trucks. The tyre segment also caters to agricultural machinery, aircraft, industrial machinery, construction and mining vehicles sectors. Bridgestone India started its operation in 1996. The company established a manufacturing plant in Kheda, Madhya Pradesh (India) which became operational two years later. The company is setting up its second plant in Pune, Maharashtra which is expected to commence operations in 2013. Globally, Bridgestone operates 184 plants, 11 proving grounds and five technical centres. In 2010, the company generated 26% of its sales from Japan, 42% from the Americas, 13% from Europe and 18% from Other regions. Bridgestone supplies to all leading carmakers. The companys major customers in the global market include BMW, Chrysler, Daimler, GM, Fiat, Mitsubishi, Nissan, Suzuki, Toyota and Volkswagen. In India, the company supplies to Ford, Honda, Hyundai, Maruti Suzuki, Nissan and Toyota. Recent Developments Corporate strategy Bridgestone aims to become the worlds largest tyre and rubber company. The company has set financial goals of achieving return on assets (ROA) of 6% in 2012. The Japanese tyremaker also aims to realise an operating income margin of 7.5% in 2012 and further improve it by 50 basis points every year to reach 10% by 2016. To achieve its goal, the company is focusing on increasing sales of high value-added ultra-high performance (UHP) and speciality tyres, improving manufacturing efficiency, strengthening supply capacity and enhancing technology. In addition, the company is focusing on increasing its global presence. Bridgestone is investing in high-growth potential markets in Asia, Europe and Americas. In India, the company announced it would invest INR26bn (USD319.3m) to set up its second manufacturing plant in Chakan, near Pune in Maharashtra. The new tyre plant will produce passenger car radial tyres (PSR) and truck bus radial tyres (TBR) to meet growing demand for such tyres in India. The plant is expected to become operational in 2013. In addition, Bridgestone India invested INR1.7bn (USD22.1m) at its Kheda plant in Madhya Pradesh to commence production of truck and bus radial tyres. The company also invested INR2.6bn (USD 30m) to expand the plants production capacity 40% to 15,000 tyres per day. Joint-Venture In December 2008, Bridgestone signed a joint-venture agreement with Sundaram Industries to manufacture anti-vibration rubber for automobiles. Sundaram Industries, a part of TVS Group, headquartered in Tamil Nadu (India) entered into a technical assistance agreement and anti-vibration agreement with Bridgestone in 1996. The joint-venture helps the companies to expand their presence in India. Anti-vibration rubber used in the chassis and engine of an automobile helps to reduce vehicle noise and vibration. Investments In July 2011, Bridgestone commenced production of truck and bus radial tyres at its Kheda plant, in Madhya Pradesh (India). The company invested INR1.7bn (USD22.1m, 31 July 2011) to commence production of truck and
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bus radial tyres at the plant. The plant is expected to reach daily production capacity of 400 tyres per day by July 2012. In April 2010, Bridgestone announced plans to set up a manufacturing plant in Chakan, near Pune in Maharashtra (India). The company will invest INR26bn (USD319.3m, 30 April 2010) in the new tyre plant which will produce passenger car radial tyres (PSR) and truck bus radial tyres (TBR) to meet growing demand for such tyres in India. While the plant is expected to commence production of PSR by January 2013, TBR production is expected to begin in August 2013. By 2020, the company expects to produce 10,000 units of PSR and 3,000 units of TBR per day. In November 2009, Bridgestone announced it would invest INR2.6bn (USD30m, 30 November 2009) to expand production capacity at its Kheda plant by 40%. Following the completion of the expansion project, the plants capacity is expected to go up to 15,000 tyres per day. The planned expansion will create 300 new jobs at the plant.
Contract Bridgestone India supplies tyres to Nissan Sunny. Certifications Bridgestone Indias Kheda plant is accredited with ISO/TS 16949, ISO14001 and OHSAS 18001 certifications. New Product and Development Bridgestone spent JPY83.98bn (USD1.1bn) on research and development in financial year 2011, 1.4% less compared with JPY85.2bn (USD1bn) in the previous financial year. The company operates five R&D centres worldwide, located in Tokyo and Yokohama (Japan), Wuxi (China), Rome (Italy) and Akron, Ohio (USA). Financial Overview In the financial year ended 31 December 2011 Bridgestone reported a 5.7% increase in net sales to JPY3trn (JPY39.1bn, 31 December 2011) compared with JPY2.9trn (USD35.1bn, 31 December 2010) in the previous year. During the financial year the companys operating environment was affected by high raw material prices and appreciating yen against major currencies. The company performance also came under pressure, for a brief period, due to the devastating earthquake and tsunami in Japan in March 2011. Despite these unfavourable circumstances, the company managed to report a 14.9% increase in operating income to JPY191.3bn (USD2.5bn) over JPY166.4bn (USD2bn) in the previous financial year. The company concluded the financial year with net income of JPY103bn (USD1.3bn), up 4.1% over JPY98.9bn (USD1.2bn) in 2010. Segment wise, tyres business reported a 7% increase in sales to JPY2.5trn (USD32.8bn) while its operating income recorded a 21% increase to JPY185.4bn (USD2.4bn). The Diversified Products segment reported a marginal growth in sales to JPY500.5bn (USD6.5bn) while operating income declined by 57% to JPY5.8bn (USD74.9m). For the financial year ending 31 December 2012, Bridgestone expects a 7% increase in sales to JPY3.2trn (USD41.8bn). However, the company expects higher earnings growth driven by its continuing focus on improving manufacturing efficiency. For the full-year period, Bridgestone is expecting a 41% increase in operating income to JPY269bn (USD3.5bn) and net income of JPY168bn (USD2.2bn).
Years Net Sales (JPYm) Operating Income (JPYm) Net Income (JPYm) No. of Employees
2011 2010 2009 2008 2007 Years 2011 2010 2009
3,024,355 2,861,615 2,597,002 3,234, 405 3,390,218 Net Sales (USDm) 39,067 35,089 26,693
191,321 166,450 75,710 131,550 249,960 Operating Income(US Dm) 2,471.4 2,041.0 778.2
102,970 98,913 1,049 10,420 131,633 Net Income (USDm) 1,330.1 1,212.9 10.8
142,865 139,822 137,135 137,981 133,752 No. of Employees 142,865 139,822 137,135
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2008 2007
32,575 28,749
1,324.9 2,119.6
104.9 1,116.2
137,981 133,752
Outlook Within a relatively short span of 15 years, Bridgestone India has emerged as one of the major tyre suppliers to both original equipment (OE) market and aftermarket in the country. The company was one of the pioneers to introduce radial tyres in India and hence has benefited from the sharp increase in radialisation in the passenger car segment which has reached almost 100%. The truck and bus tyre segment, in which radialisation is around 20 to 22%, is expected to see strong growth in coming years. With this in mind, Bridgestone has set up a truck and bus radial production line at its Keda plant. In addition the companys upcoming Chakan plant will also commence production of radial tyres for trucks and bus. This is expected to help Bridgestone meet growing demand for truck and bus radial tyres in India. Globally, Bridgestone is undertaking several initiatives to achieve its goal of reducing raw materials use by half. The company aims to procure raw material from a wider base of suppliers globally, use more diverse materials and improve production accuracy. These steps are taken with the objective of keeping a tap on production costs and helping the company to achieve its operating income margin growth of 6% in 2012 and 10% by 2016.
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Caparo India
Chassis components
Address
Caparo House 103 Baker Street London, W1U 6LN United Kingdom
Caparo India is the Indian business arm of the UK-based Caparo Group which has diverse interests in steel automotive and general engineering products. The company operates a 75:25 joint-venture with Maruti Suzuki, Caparo Maruti, which is an associate vendor of the leading Indian automaker.
Caparo Group entered India in 1994 through forming a joint-venture (JV) with Maruti Suzuki India Limited (MSIL), a leading passenger vehicles manufacturer in the country. The JV, called Caparo Maruti, is a major supplier of sheet moulding components to the Indian subsidiary of Suzuki. The company currently operates three plants in Gurgaon and Bawal, both in Haryana and one in Halol, Gujarat (all in India). Maruti Suzuki owns 25% of Caparo Maruti. In addition to Caparo Maruti, Caparo India operates three other main subsidiaries in India Caparo Engineering, Caparo Financial Solutions and Caparo Energy. Overall, the company operates 25 facilities in India across Gujarat, Haryana, Jharkhand, Madhya Pradesh, Maharashtra, Rajasthan and Tamil Nadu, and has 5,000 direct and indirect employees. In addition to Maruti Suzuki, the company supplies most of the other automakers operating in India. The companys major customers include Ashok Leyland, Eicher, Force, Ford, GM, Hero MotoCorp, Honda Motorcycle & Scooter India, Honda Siel Cars, John Deere, Nissan, Piaggio, Royal Enfield, SML Isuzu, TAFE and Tata Motors. The company also supplies to some major tier one suppliers in India including Rane, Subros and Tata Johnson Control.
Tel: +44 20 7486 1417 Fax:+44 20 7224 4109 Internet: http://www.caparo.com India Caparo Maruti Limited Plot 7, Maruti Joint-Venture Complex Delhi- Gurgaon Road Gurgaon 122015 Haryana India Tel: +91 124 4318 100 Fax: +91 124 4016 829 Internet: http://www.caparomaruti.com Senior Officers
Swaraj Paul, Chairman Angad Paul, CEO, Caparo Group Rajesh Prasad, CEO and Country Head, Caparo India
Recent Developments
Corporate strategy Caparo India is investing in capacity expansion to meet expected surge in orders from its customers including from the automotive industry. The company an earmarked investment of INR500m (USD11m, 31 March 2011) in 2011, INR900m (USD19.8m) in 2012 and INR1bn (USD22m) in 2012. Caparo is expecting to reach a turnover of INR5bn (USD110.1m) in the financial year 2012. The parent company is targeting USD1bn from the automotive business over the next three to five years. Caparo is investing in additional capacity at its plants in Guragon and Bawal, Haryana (India), managed by Caparo Maruti to meet expected surge in demand from Maruti Suzuki as the latter introduces new models. The company is planning to invest INR300m to invest to ramp up stamping capacity at its Grugaon plant and INR450m at its Bawal plant to meet expected growth in orders from Maruti Suzuki. The company is also considering adding a paint shop and tubing portfolio at Bawal plant for Caparo Vehicle Product India Limited (CVPIL). The company will invest INR1.5bn over two years in the plant. Caparo India is working to provide end to end engineering solutions to its customers. The company has invested INR3.5bn in various manufacturing hubs of Tata Motors including at Jamshedpur, Jharkhand, Pune, Maharashtra and Sanand, Gujarat (all in India). In addition, the company has a forging division and aluminium die casting unit at Chennai, Tamil Nadu (India) along with the paint shop, engineering and tool unit. The company which has been a major supplier of body-in white (BIW) parts including door panels, floor panels, door inner, front members, and hood inners, is moving up the value chain to improve margins. The company is now shifting its focus on producing assemblies, chassis and braking systems as well as non-metal systems like aluminium castings, forgings, tubing and tooling. Caparo India is following a more integrative approach in order to gain from advanced technology at its European operations. For example the company have two forging units in Poland and the UK and is working to
Products
Chassis, cowl upper assemblies, dash, door assemblies, quarter inner assemblies, sheet metal components
Plants
India (25) across Gujarat, Haryana, Jharkhand, Madhya Pradesh, Maharashtra, Rajasthan and Tamil Nadu
Sales Caparo Plc: EUR1bn(USD1.4bn, 31 March 2011) Caparo India: INR5bn (USD110.1m, 31 March 2011) (year to 31.03.12) Employees
Group: 5,000 (31 March 2011)
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create synergies of a low cost centre with the forging facility in Chennai, Tamil Nadu (India). Acquisition In January 2007, Caparo Engineering India Private Limited (CEIPL) completed the acquisition of the Sheet Metal Business of International Auto Limited (IAL), a flagship company of RSB Group. IAL has sheet metal operations at Jamshedpur, Jharkhand and Pune, Maharashtra (both in India) with total installed capacity of 16,000 metric tonnes (MT). IAL is a leading supplier of sheet metal auto components to Tata Motors. The acquisition further strengthens CEIPLs presence in sheet metal business in India. The company already operates a sheet metal auto component plant at Pune, Maharashtra (India). The acquisition is also expected to strengthen CEIPLs relationship with Tata Motors. Joint-venture In April 2008, Caparo India signed a technical agreement with Hyundai Motors to manufacture fully assembles luxury buses in India. The two partners agreed to set up a manufacturing plant in southern India. The Korean automaker will provide the technical support and meet all regulations related to supply and manufacture of commercial vehicles in India. The buses manufactured by the alliance will be equipped with powerful and fuel-efficient Euro III/IV engines, air-wade suspension and ABS systems. Investments In January 2008, Caparo India announced plans to invest INR35bn (USD888.5m, 31 January 2008) to set up an automotive, engineering and aerospace components park in Nellore, Andhra Pradesh (India). Of the total the company will invest INR20bn (USD507.7m) in the first phase. The company has already acquired a 2,000 acre land from state government for the components park. The company will also create a special economic zone (SEZ) on 500 acres in this area besides concentrating on the domestic tariff area (DTA) for its manufacturing operations. The park will provide employment to over 10,000 people over the next 15 years. In October 2007, Caparo India inaugurated its new industrial complex in Sriperumbudur, near Chennai Tamil Nadu (India). The complex is built on 120 acres of land and houses a stamping unit, research and development (R&D) centre and tool room, an aluminium foundry and a forging unit. The company made an initial investment of GBP120m (USD247.6m, 31 October 2007). The complex is mainly engaged in supply of components to automotive industry. In August 2007, Caparo announced that it had acquired 70 acres of land in Bawal, Haryana (India) to set up six new engineering ventures for vehicle product division in India. The company plans to set up sheet metal stamping facilities. The company planned to set up a Steel Service Centre to offer services like cutting, blanking and slitting to suppliers with just-in-time (JIT) requirements and for a steel tube plant to be constructed to cater for the needs of the automotive and nonautomotive engineering industry. The new ventures will primarily supply to leading automakers in North India including Honda and Tata Motors. The company has earmarked a total investment of INR5.1bn (USD123.9m, 31 August 2007). The planned investment was expected to create 2000 new jobs. Contracts Caparo India supplies body structures for the Tata Nano. Caparo Maruti supplies chassis for Maruti Suzukis Omni van. Caparo Maruti supplies dash assembly components for Alto, Zen and Wagon R of Maruti Suzuki. The company supplies inner quarter assembly for Alto. Caparo Maruti makes complete doors for Chevrolet Tavera. Financial overview Caparo India is part of the UK-based Caparo Group which has a turnover of EUR1bn (USD1.4bn, 31 March 2011). The company is privately owned and therefore does not provide details of its financial results. Caparo India is expected to generate INR5bn (USD110.1m) in sales in the financial year 2012.
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country in the past decade, the company continues to depend on Caparo Maruti for growth. The JV with Maruti-Suzuki still accounts for more than 95% of Caparos sales in India. Caparo Maruti as an associate of Maruti-Suzuki, has benefited from the strong surge in vehicle production at the leading passenger vehicle manufacturers in the past two years. However, Caparo India is looking beyond Maruti Suzuki and has significantly expanded its customer base over the years. The company currently caters to most of the passenger cars and commercial vehicles operating in the country. Caparo India continues to receive business queries from new automakers. For example PSA Peugeot Citron which is setting up an integrated vehicle manufacturing plant in Sanand has approached Caparo for a quotation for skin panels and body-in-white (BIW) for its hatchback and sedan it is planning to produce in India.
Outlook Although Caparo India has diversified its presence in the
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Clutch Auto
Clutches and clutch components
Address Clutch Auto Limited 12/4, Mathura Road Faridabad-121003 Haryana India Tel: +91 129 2565 000 Fax: +91 129 2275 246 Internet: http://www.clutchauto.com Senior Officers Vijay Krishan Mehta, Chairman & Managing Director Anuj Mehta, Executive Director Products Angle spring clutches, cerametallic wet and dry clutches, clutch plates and friction discs, clutch discs, diaphragm and coil spring clutches, dual clutches, hubs, lever, pressure plates, rollers, springs and yokes, clutch cover assemblies, repair kits Plants India: Rajasthan Sales INR2.51bn(USD55.2m, 31 March 2011) (Year to 31.03.11) Employees c. 674 (2011)
Clutch Auto is the largest manufacturer and exporter of clutches in India. The company makes clutches for passenger cars and commercial vehicles. In addition, the company supplies to tractors, earthmovers and defence vehicles.
Founded in 1971, Clutch Auto produces a diverse range of clutches for both OEMs and the aftermarket. The company operates one manufacturing facility in India located in Faridabad, Haryana. However, in 2010, the company decided to shift the manufacturing plant to Bhiwadi in Rajasthan (India). The relocation is expected to be completed by end of 2011. The company supplies its products to two-wheelers, passenger cars and commercial vehicles. Clutch Autos major automotive customers include Ashok Leyland, Bajaj Auto, Escorts, Eicher, JCB, Mahindra & Mahindra, Maruti Suzuki, New Holland, Punjab Tractors, Sonalika Tractors, Tata, John Deere, Swaraj Enterprise and TAFE. In the aftermarket, Clutch Auto claims to have the largest network of distributors in India. The company generates nearly half of its sales from the aftermarket. Clutch Auto exports its products to about 40 countries worldwide. North and South Americas is the largest export market for the company accounting for about 85% of total exports. The companys other major export markets include Australia, Canada, Egypt, Indonesia, Iran, Italy, Malaysia, Pakistan, South Africa, Singapore, Sri Lanka, UAE and UK.
Corporate Strategy In 2010, Clutch Auto decided to relocate its manufacturing plant from Faridabad in Haryana to Bhiwadi in Rajasthan (both in India) in order to expand capacity. The company acquired 50,000m2 land in Bhiwadi, for INR150m (USD3.2m 31 January 2010). The new plant is expected to start operations by the end of 2011. The company is investing INR1bn (USD21.3m) in relocating the manufacturing facility. The new plant became operational in 2011. In February 2011, Clutch Auto announced a demerger plan. Under the plan, the company placed its auto component business and its ongoing technology development projects in a newly-formed company called CA Clutch Vision. The company has formed another company called CA Developers Limited to develop its plot in Mathura, where its former plant was located. CA Developers will be a subsidiary of CA Clutch Vision. The demerger is expected to allow the company to better focus on its main auto parts business. Clutch Auto is focusing on new product development to secure new business. The company is developing new products under the New Millennium Indian Technology Leadership Initiative (NMITLI) along with Council of Industrial and Scientific Research (CSIR), Department of Science and Technology, government of India. The project was started in March 2008 with an objective to significantly increase service life of a clutch for passenger cars, commercial vehicles and tractors in association with distinguished national institutes. The new products will be available at the companys new Bhiwadi facility for commercial production. Acquisition In January 2006, Clutch Auto acquired the clutch division of US based Pioneer Automotive Products for an undisclosed amount. Products of the acquired company are sold under the name of Pioneer Clutch Inc. Investment In January 2010, Clutch Auto acquired 50,000m2 land in Bhiwadi, Alwar, Rajasthan (India) for INR150m (USD3.2m 31 January 2010). The company is relocating its manufacturing plant from Faridabad,
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Haryana to the new location. The new plant was commissioned in 2011. Contracts In September 2010, Clutch Auto won two additional projects from Tata Motors. In August 2006, Clutch Auto won a contract worth USD5.5m from Turkey based Uzel. Clutch Auto has signed four long-term arrangements with Ashok Leyland. Additionally the company has signed an IPR confidentiality agreement with Ashok Leyland for a joint research program. The company supplies clutches to the Maruti Suzuki 800 and Omni programs.
New Product Developments Clutch Auto has indigenously developed its line of clutches. The company has an in-house research and development (R&D) centre. The company is lining up six new trademarks and about fifteen new patents. The company has already been allotted some patents by the USPTO.
Clutch Auto has developed new products to be supplied to Navistar. Clutch Auto is developing new products under the New Millennium Indian Technology Leadership Initiative (NMITLI) Scheme, along with the Council of Scientific & Industrial Research (CSIR), New Delhi, under the aegis of Ministry of Science & Technology, Government of India and many distinguished national institutes. The new range of products to be developed under this project will double the longevity of clutches and create altogether a different category of product, both in domestic and international arena. Clutch Auto, in association with Hindustan Aeronautics Ltd. (HAL), developed technology for Dual Sintered Buttons used on commercial vehicles clutches for domestic as well as overseas applications. The use of these buttons will significantly increase the clutch life. Clutch Auto, in collaboration with Hindustan Aeronautic Limited, has done the localization of Cerametallic Buttons. This development activity is being extended to local manufacturers, a major step in terms of containing cost of clutches both for domestic and international truck manufacturers. Clutch wear adjustment indicator: is a device to automatically indicate when the clutch needs wear adjustment. An inductive electrical sensor on the bearing cage is placed with a gap between the sensing surfaces, and when the top face of the housing falls beyond a predetermined limit, the sensor generates a signal that lights a bulb or horn in the driver cabin to indicate to him that the wear on the clutch disc needs to be readjusted. The company has applied for a patent for the product. 14-inch flat flywheel cast cover clutch: is a replacement for the stamped steel cover clutch. The product is a cast cover with ventilation louvers which helps to keep the clutch cool. A release sleeve retainer ensures alignment and concentric movement vis--vis release sleeve assembly results in lower clutch wear. The product can be used for Class 6 & 7 trucks & buses. Pre-damp high torque disc PDHT is a replacement for VCT-soft rate dampers and LTD clutch discs. The product is meant for contemporary trucks with higher torque capacity, which broadly includes 90% of the truck production. Engine cycles of low RPM engines are close to natural frequency of the powertrain, while operating close to the resonance levels. High oscillation attenuation is observed in the drive lines which, unless absorbed/arrested can cause severe vibration and in turn cause high wear and tear of drive line components. PDHT Disc absorbs engine cycles and torsional vibrations of the engine up to a fourtwist angle.
Certifications Clutch Auto has been accredited QS 9000 and TS 16949 status. Financial Overview In the financial year ended 31 March 2011 Clutch Auto reported a 9.2% increase in net sales to INR2.5bn (USD55.4m, 31 March 2011) compared with INR2.3bn (USD51.1m, 31 March 2010). The company reported profit before interest and tax (PBIT) of INR264.3m (USD5.8m), an increase of 16.7% over INR226.4m (USD5m) in the previous year. Clutch Auto reported
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profit before tax of INR97.6m (USD2.1m) over INR91.2m (USD2m) in the previous financial year. The company concluded the financial year with a 6.8% increase in net profit to INR89.6m (USD2m) compared with INR84m (USD1.9m) in the previous fiscal. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 2,505.1 2,299.8 1,974.5 2,169.8 2,350.7 Net Sales (USDm) 55.2 51.1 37.8 54.4 54.1 Operating Profit (INRm) 264.3 226.4 190.9 275.4 341.0 Operating Profit (USDm) 5.8 5.0 3.6 6.9 7.8 Profit Before Tax (INRm) 97.6 91.2 56.3 160.5 252.0 Profit Before Tax (USDm) 2.1 2.0 1.1 4.0 5.8 Net Profit (INRm) 89.6 84.0 44.6 134.7 209.6 Net Profit (USDm) 2.0 1.9 0.8 3.4 4.8
Outlook Clutch Auto is the only stand-alone clutch manufacturer in the world
and faces tough competition from global suppliers. However, the company is based in low-cost country India and enjoys relatively low manufacturing costs compared with its global rivals. The company also has a strong presence in aftermarkets which make it less dependent on the more volatile original equipment (OE) market. Clutch Auto is experiencing strong growth in orders and is finding it tough to meet sudden surge in demand. However, the planned relocation and capacity expansion at the upcoming Bhiwadi plant should help the company to reduce capacity constrain in coming years.
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Continental
Automotive systems and tyres
Address Continental AG P.O. Box 169, 30001 Hanover Germany Tel: +49 511 938 01 Fax: +49 511 938 81770 Internet: http://www.conti-online.com India Office Continental India Limited. NH-58, Meerut - Roorkee Road Modipuram - 250110 MEERUT (Uttar Pradesh) Senior Officers Elmar Degenhart, Chairman, Executive Board, Corporate Communications Wolfgang Schfer, Member of Executive Board, Finance Products Access control systems, chassis components, engine systems, electronic brake systems, fuel supply, hydraulic brake systems, LED light control, instrumentation and displays, interior modules, navigation systems, passive safety and advanced driver assistance systems, seat systems, sensors and actuators, transmissions, tyres, tyre information systems Plants India (11) Sales Group: EUR26bn (USD34.5bn, 31 December 2010) (Year to 31.12.10) Employees Group:148,228 (December 2010)
Continental is a leading automotive supplier of brake systems, chassis components, vehicle electronics, tyres and powertrain controls. The company focuses on manufacturing products which improve safety, drive dynamics and ride comfort. It is the second largest automotive supplier in Europe.
Continentals business is primarily segmented into two groups Automotive Group and Rubber Group. Automotive Group consists of Chassis & Safety (22.1% of 2010 sales), Interior (21.1%) and Powertrain (18%) divisions. The Rubber Groups business includes Passenger & Light Truck Tires (22.2%), Commercial Vehicle Tires (5.2%) and ContiTech (11.4%) divisions. In June 2011, Continental finalised a reorganisation effective from 1 August 2011 according to which the Passenger & Light Truck Tires (PLT) and Commercial Vehicle Tires (CVT) divisions were consolidated into one Tyres division. Nikolai Setzer will head the combined division. The Passenger and Light Truck Tires division consists of five business units, Original Equipment, Replacement Business - EMEA, Replacement Business The Americas, Replacement Business Asia-Pacific and Two-Wheeler Tyres. The division produces tyres for OEMs, replacement market and two-wheelers. The Commercial Vehicle Tires division manufactures tyres for trucks, industrial applications such as transportation, stack/lift, earth mover, multi-purpose and OTR applications such as for construction, mining and forestry. In 2010, Passenger and Light Truck Tires division generated 49% of the total sales from Europe (excluding Germany), 21% from Germany, 19% from NAFTA, 6% from Other Countries and 5% from Asia. In September 2008, Schaeffler acquired a 90.19% stake in Continental. Schaeffler intends to maintain a holding cap of 49.99%. Continental supplies to all major carmakers. Its major customers include BMW, Chrysler, Daimler, Fiat, Ford, General Motors Renault-Nissan and Volkswagen. Recent Developments Corporate strategy: Continental is expanding its tyre business globally through acquisitions and investments in emerging markets. In May 2011, the company acquired its outstanding stake in truck tyre joint-venture with Yokohama, GTY Tire. In July 2011, Continental acquired the subsidiary of Modi Rubber Ltd, Modi Tyres Company Limited (MTCL) in India. The company acquired the majority ownership in Compania Ecuatoriana del Caucho S.A. (ERCO) in July 2009 to strengthen its business in passenger, light truck and commercial truck tyres. Continental aims to achieve 25% of its sales from Asia by 2013. The company is expanding its presence in Asia to shift its production from high-cost regions. Continental announced it would invest more than EUR1bn (USD1.43bn, 13 May 2011) in Brazil, Russia, India and China (BRIC) countries. In India, the company entered the tyre market through acquiring Modi Tyres Company Limited (MTCL), the tyre business of Modi Rubber Limited in 2011. After the acquisition, Continental announced an investment of EUR50m (USD66.4m) at the Modipuram plant of the acquired company to ramp up production capacity of bias truck and bus tyres. In 2012, the company announced investment in the Indian plant to enter radial tyre segment which has been recording strong growth, driven by growing radialisation in the country. Acquisitions In July 2011, Continental completed the acquisition of Modi Tyres Company Limited (MTCL). The wholly-owned subsidiary has been named Continental Tyres India Ltd. The acquisition was valued at
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INR1.3bn (USD28.6m) which includes a payment of INR1.1bn (USD24.2m) for share acquisition and INR172m (USD3.7m) as noncompete fees. The acquired business will focus on production and distribution of tyres (both radial and bias) for buses, trucks and radial tyres for passenger vehicles. Continental signed an agreement with Modi Rubber Ltd to acquire a 100% stake in its subsidiary, MTCL in April 2011. Joint-ventures In November 2008, Continental Tyres and India-based Modi Tyre extended their previously formed technical joint-venture. Earlier, the jointventure was suspended with the closure of Modi Tyres facility in Modinagar, Uttar Pradesh (India). The Indian partner then invested INR3bn (USD62.4m, 6 November 2008) to restart the facility. Under the agreement, Continental did make any investments in the venture, while the tyres are marketed with Continentals brand name. Production at the facility resumed in December 2008, with an annual capacity of 1.1 million truck tyres and tubes. In June 2007, Continental Automotive Systems formed a 50:50 JV with India-based Rico Auto Industries and set up a facility in Gurgaon, Haryana (India). The facility has the capacity to produce one million brake actuation units, two million brake calipers, 1.5 million drum brakes and 0.5 million load sensing proportioning valves annually. Investments In January 2012, Continental announced plans to invest INR8bn (USD148.2m, 9 January 2012) in India over the next two years. Of the total planned investment, the company will invest INR5bn (USD92.6m) to ramp up its automotive electronics and enhance its research and development (R&D) capabilities. The company will invest EUR50m (USD63.5m) to enter the radial tyre segment. The company will launch radial tyres for both passenger cars and commercial vehicles from its Modipuram plant in Uttar Pradesh in India. Also, the company plans to invest INR1bn (USD18.5m) every year on electronics equipment to introduce new products and support new customers. In May 2011, Continental announced it would invest more than EUR1bn (USD1.43bn, 13 May 2011) in Brazil, Russia, India and China (BRIC) countries. In India it planned to manufacture tyres post the acquisition of Modi Tyres. In May 2011, Continental inaugurated the third phase of its technical centre based in Bangalore (India). The company added 17,000 ft2 of area which can employ 400 people. The move supports the companys strategy to expand in emerging markets. The centre develops automotive technology and provides software services for Automotive Group. In August 2010, Continental Automotive announced plans to set up two new facilities in India. One plant will manufacture complete dieselinjection systems and the other sensors for airbags. In January 2010, the company planned an expansion at the Bangalore facility (Indian) to increase the overall capacity to cater to the upcoming demand. They have invested INR4bn (USD86.8m, 7 January 2010) in Indian operations since 2007. In March 2009, Continental opened a new technical centre in India. The facility located at Bommanahalli, Bangalore will provide software services. The company has partnered with Siemens Information Systems Limited, KPIT Cummins Infosystems Limited and Wipro for developing and supporting multiple automotive engineering projects. The technical centre develops and tests engine management systems, digital tachographs and telematics systems. The centre currently employs 600 engineers and the company plans to increase the number by 20% every year with a planned investment of INR3bn (USD58m, 25 March 2009). In July 2008, Continental commenced operations at its manufacturing facility and research and development centre in Bangalore (India), the setup for which was announced in January 2008. The facility produces automotive electronics and caters to low-cost car segments in the emerging markets such as India and other Asian countries. The company made an investment of INR2.2bn (USD51.8m, 31 July 2008) in the facility. New Product Developments In 2010, R&D expenses climbed 6.9% to EUR1.45bn compared with EUR1.35bn in 2009. The R&D expenses accounted for 5.6% of sales compared with previous years 6.7%.
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Financial Overview For the financial year ended 31 December 2010, Continental sales increased 29.6% to EUR26bn (USD34.5bn, 31 December 2010) compared with EUR20bn (USD28.8bn, 31 December 2009) in the previous year. The companys earnings before interest and taxes (EBIT) stood at EUR1.9bn (USD2.6m) against a negative EBIT of EUR1bn (USD1.5bn) in 2009. Net income was EUR576m (USD763.3m) compared to a net loss of EUR1.6bn (USD2.4bn) a year ago. Geographically, Continental sales in Asia rose 49% to EUR4.2bn (USD5.6bn). Sales in Other Countries grew 41.7% to EUR1.4bn (USD1.9bn). For the fiscal 2011, Continental expects to increase its sales by 10% y/y to more than EUR28.5bn (USD37.8bn). Year 2010 2009 2008 2007 2006 Year 2010 2009 2008 2007 2006 Net Sales (EURm) 26,046.9 20,095.7 24,238.7 16,619.4 14,887 Net Sales (USDm) 34,516.0 28,801.6 23,425.5 24,461.3 19,640.4 EBIT (EURm) 1,935.2 (1,040.4) (296.2) 1,675.8 1,601.9 EBIT (USDm) 2,564.4 (1,491.1) (417.5) 2,466.5 2,113.4 Net Income (EURm) 576.0 (1,649.2) (1,077) 1,049.9 1,004.6 Net Income (USDm) 763.3 (2,363.7) 1,518.0 1,545.3 1,325.4 R&D Expenditure (EURm) 1,450.4 1,356.3 1,498.2 834.0 677 R&D Expenditure (USDm) 1,922.0 1,943.9 2,111.7 1,227.5 893.2 No. of Employee s 148,228 134,434 139,155 151,654 85,225 No. of Employee s 148,228 134,434 139,155 151,654 85,225
Outlook Continentals growth strategy by investing in low-cost regions is likely to help the company expand its presence and improve margins. Continental foresees high growth potential in the emerging markets of India, China, Brazil and Russia. Tyre sales in China are expected to increase 30% in 2011. The company with its strong presence in the country would be able to reap the benefits of the growth. However, rising raw material costs may jeopardise its growth prospects. Continental would be able to cope with the raw material prices by increasing tyre prices. Continental seems to benefit from the radialisation in India. However, it is Continentals auto component business which has the potential to attract the larger share of the announced investment in 2012. All six business units of the German supplier are present in India either through wholly-owned subsidiaries or joint-venture partnership with Indian suppliers. The company operates six manufacturing facilities in Bangalore, Manesar, Pune, Gurgaon, Sonepat and Kolkata (all in India). In 2011, Continental generated EUR200m (USD265.4m) from India. The company expects to grow in the Indian automotive market at a higher rate than its global operations.
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DCM Engineering
Automotive castings
Address DCM Engineering Limited Post Box No. 5 Ropar 140 001 Punjab India Tel: +91 1881 501 802/803 Fax: +91 1881 270 807 Website: http://www.dcmengg.com/ Senior Officers Dr Vinay Bharat Ram, Executive Chairman Sumant Bharat Ram, Vice Chairman Jai Kumar Menon, Managing Director S. Nagaraj, Assistant Vice-President, Production Sitanshu Pal, General Manager, Projects & Plant Engineering Vikas Girdhar, General Manager, Marketing & Sales Products Cylinder blocks, cylinder heads and housings Plants India (2): Punjab (2) Sales INR3.7bn (USD81.9m, 31 March 2011) (Year to 31.12.2011)
DCM Engineering, a company of the DCM Group, is a leading supplier of automotive castings. The company manufactures cylinder blocks, cylinder heads and housing for passenger cars and commercial vehicles.
DCM Engineering was established in 1977 as part of the DCM Group's engineering division. Later in 2004, it was spun off into an independent company. The company operates a grey iron foundry located near Ropar in Punjab with annual production capacity of 72,000 metric tonnes per annum (mtpa). The foundry manufactures cylinder heads, cylinder blocks and housings for the passenger cars, utility vehicles, commercial vehicles and tractors. The company has announced plans to set up its second plant near it first plant in Ropar, Punjab (India). DCM Engineering supplies its products to Ashok Leyland, Eicher Motors, Escorts, Force Motors, Hindustan Motors, GM, Hyundai India, JCB, Mahindra & Mahindra, Maruti Suzuki, SML Isuzu Mazda, Simpson & Co, and Tata Cummins. In addition to the domestic market, the company exports its products to GM Daewoo (South Korea), GM (US), Perodua Perkins Motors (Malaysia) and Hepworth Heating (UK). Recent Development Corporate strategy DCM Engineering is expanding its business to meet growing demand for its products from the domestic market. The company which has annual production capacity of 72,000 metric tonnes (mt) is investing in a new manufacturing plant to raise the capacity to 150,000mt. In June 2011, DCM Engineering announced plans to invest INR2bn to set up a new plant near its existing plant in Ropar, Punjab (India). The new plant is expected to commence production of castings from January 2013 with a planned capacity of 70,000 to 75,000 (mtpa). The plant will serve tractors and heavy commercial vehicles. The company had been considering a second plant for some time. In April 2008, the company disclosed its plan to set up its second plant in Chennai to serve its customers in southern India. But the company dropped the idea following the global economic slowdown. However, the strong growth in financial year 2011 drove DCM Engineering to revive its expansion plans, though the companys plant is now being established at its existing plant in northern India. During the year, DCM Engineerings supply fell short by over 7,000mt per month despite increase in total supply from 5,1473mt to 58,579mt. Volatility in the global market, combined with a lack of adequate capacity, is forcing DCM Engineering to focus more on the domestic market for growth. However, once the company ramps up its capacity through commissioning its second plant, it will renew its focus on exports. DCM Engineering is keen on resuming supplies to Perkins, a part of the Caterpillar group, marking a step ahead for exports. In the area of product development, DCM Engineering developed cylinder blocks made from compacted graphite iron (CGI) castings by using SinterCast process control technology in 2009. The product which offers weight reduction benefit has been shipped to a passenger and commercial vehicle OEM in India. The company has also hinted that the deal with international OEM is also expected to close. Investments In June 2011, DCM Engineering announced plans to set up a new unit near its existing facility in Ropar, Punjab (India) with an investment of INR2bn (USD44m, 30 June 2011). The plant is expected to commence production of castings in January 2013 with a planned capacity of 70,000 to 75,000 (mtpa). The plant will serve tractors and heavy commercial vehicles. In 2007, DCM Engineering installed automatic core making systems at an investment of INR200m (USD5m, 30 September 2007) at its plant in Ropar,
Employees
c. 1,700 (2011)
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Punjab (India). Contracts In October 2009, DCM Engineering announced that it had delivered compacted graphite iron (CGI) engine cylinder blocks to commercial and passenger vehicles OEMs in India. The company didnt disclose the name of the customer. The component developed SinterCast process control technology. The weight of the cylinder blocks varies from 88 to 386 lbs (40 to 175 kg). In March 2006, DCM won an order worth USD0.315m from GM to develop a V8 cylinder block called Bowtie. The cylinder block is for a sports car model being developed by GM. Certifications DCM is accredited with QS9000 certification and is currently implementing TQM. Financial Overview In the financial year ended 31 March 2011, DCM Engineering posted a 29.8% increase in sales to INR3.7bn (USD81.9m, 31 March 2011) compared with INR2.9bn (USD63.6m, 31 March 2010) for the same period in the previous year. There were no international sales during the period. However, in FY2010, the company exported components worth INR11.9m (USD264,268) The company witnessed a sharp increase of 24.5% in manufacturing and other expenses during the financial year to INR3.4bn (USD74.9m) over INR2.7bn (USD60m) a year ago. DCM Engineering reported a 16.5% decline in profit before tax (PBT) from INR281.5m (USD6.3m) to INR234.7m (USD5.2m). The company concluded the financial year with net profit of INR156.m (USD3.4m), a decline of 34.6% over INR210.8m (USD4.7m) in 2010. DCM Engineering expects to continue benefitting from strong demand of its products in India. The company is expecting to grow by 12% to 15%. Outlook DCM Engineering is witnessing a surge in demand for its products primarily from the domestic market. The company primarily caters to commercial vehicles and farm tractors which are performing reasonably well even in financial year 2012, when certain other segments of the automotive industry such as passenger cars and three wheelers are reporting decline in sales. However, the company sees this decline in demand in some segments of the Indian automotive industry as a short term aberration. DCM Engineering expects the Indian automotive market to grow at around 15% over the next five years. This is expected to create tremendous growth opportunities for local suppliers including DCM Engineering. The companys plan to set up a second plant is expected to help it meet the surge in demand in the coming years.
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Delphi TVS
Pumps, injectors, filters
Delphi-TVS is a joint-venture between Delphi Automotive and India-based TVS Group. The company is a major supplier of rotary fuel-injection systems in India.
Delphi-TVS is a 52:48 joint venture (JV) between Delphi Automotive (USA) and T.V. Sundaram Iyengar & Sons (India) established to produce diesel fuel injection systems in India. The JV was the first manufacturer to introduce Euro I, Euro II and Euro III- compliant rotary pumps in India. The company serves cars, multi-utility vehicles (MUV), sports utility vehicles (SUVs), commercial vehicles, off-highway, generators and industrial applications. The company operates three manufacturing plants in India, two of which are located at Mannur and Orgagadam in Tamil Nadu and one in Pantnagar, Uttarakhand. As of March 2011, the company had about 1,000 employees. Delphi-TVS supplies to Ashok Leyland, Fiat India, Ford India, Hyundai Motors India, Delphi, Hindustan Motors, JCB, Mahindra & Mahindra, Maruti Suzuki, Renault-Nissan, and Tata Motors. The company also supplies to its JV partner Delphi Automotive. Recent Developments Corporate strategy Delphi-TVS is investing in capacity expansion in India. The company, which operates three manufacturing facilities in the country, is investing INR3.5bn (USD74.7m, 31 January 2010) in setting up its fourth plant in Chennai, Tamil Nadu (India) to meet expected suge in demand. In January 2010, the company disclosed its goal to reach sales of INR10bn (USD213.4m) by financial year 2013. The company is developing low-cost products aimed at meeting the demand from domestic customers. For instance, the company has equipped its commonrail system with an electronic control unit (ECU) which is imported from the parent companys Singapore unit. The free-trade agreement (FTA) between India and Singapore paves the way for the company to reduce cost and deliver the final product cheaper when compared with its competitors. With this low-cost product, the company aims to win contracts from customers including Ashok Leyland. Delphi-TVS plans to diversify its operations into research and development (R&D) and develop products which comply with strict emission norms. The company is already developing products which meet Bharat IV emission norms. Further, the company has access to its parent companys technology to manufacture commonrail systems which comply with Euro 4, Euro 5 and Euro 6 emission standards for diesel engines. The company is preparing itself well in advance for its technological requirements so as to fulfill Euro 6 and Euro 7 standards as well. Investments In January 2010, Delphi-TVS announced that it was investing INR3.5bn (USD74.7m, 31 January 2010) to set up a fourth plant near Chennai, Tamil Nadu (India) to produce commonrail systems for diesel engines. This is in addition to the two existing facilities in the region. In January 2008, Delphi-TVS announced plans to invest INR5bn (USD127.2m, 8 January 2008) to expand the production and technical centre in Chennai, Tamil Nadu (India). Of the total investment amount, INR4bn (USD101.8m) is to boost production capabilities at two plants in Chennai, INR500m (USD12.7m) to ramp up the Chennai R&D operations and the rest to be invested in Pant Nagar, Uttarakhand (India). In November 2006, Delphi-TVS announced the setting up of a plant at Uttarakhand to supply diesel engine requirements of Tata Ace programme at a capital cost of INR400m (USD8.9m, 30 November 2006). Address Delphi TVS Limited Aalim Centre, 2nd Floor 82, Dr Radhakrishnan Salai Mylapore Chennai- 600 004 Tamil Nadu India Tel: + 91 44 2811 0063/ 0074 Fax: + 91 44 2811 5624 Website: http://www.delphitvs.com Senior Officers JS Chopra, President TK Balaji, CEO Products Diesel commonrail systems Plants India (3): Tamil Nadu (2), Uttarakhand Sales INR7.4bn (USD219.5m, 31 March 2011) Employees c. 1,000 (March 2011).
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Contracts In 2008, Delphi-TVS secured commonrail systems (CRS) contracts with Ashok Leyland, Daimler, Ford and Tata Motors. Delphi-TVS has a contract with Tata Motors to supply rotary fuelinjection systems for the Tata Indica platform and Sumo Grande. The company supplies CRDi system for the Tata Safari Dicor programme The company supplies Ford in UK and Peugeot in France. New products development Delphi-TVS operates a technical centre at Mannur, Tamil Nadu (India) which is equipped with additional facilities such as chassis dynamometer and commonrail engine test cell and test rigs. The development centre also has engine test cell with raw emission measurement, fuel system performance test rig, commonrail pump and injector calibrating rigs, endurance test rigs and environment test equipment. The centre also has access to Delphi technologies from across the globe. Certifications The company is certified with ISO/TS 16949 and ISQ 14000 status. Financial Overview In the financial year ended 31 March 2011, Delphi-TVS reported sales of INR7.37bn (USD162.3m, 31 March 2011), compared with sales of INR5.5bn (USD122.1m, 31 March 2010) in the previous year. DelphiTVS is a privately-owned company and does not publish detailed financial statements. Outlook The past two years have seen a significant increase in demand for diesel vehicles in India, especially since the Indian government deregulated petrol prices in June 2010. Since then oil marketing companies (OMCs) have been allowed to adjust petrol prices according to the international market price. This has resulted in sharp increase in price of petrol. However, the diesel price continues to be regulated by the government and has experienced less volatility. As a result the gap between prices of petrol and diesel has widened and this has fuelled the demand for diesel power vehicles. Automakers operating in India are scrambling to meet the sudden surge in demand for diesel vehicles through increasing output. This is a good trend for suppliers like Delphi-TVS who are major players in commonrail systems. Delphi-TVS has taken a substantial lead over its competitors by winning a diesel engine injection components contract from Tata Motors. Tatas Indica platform sales have been growing steadily and Delphi-TVS stands to gain through Tata. The company further stands to benefit from growth in the diesel vehicles market share as more and more automakers are offering diesel engines in cars. This is likely to help the company improve its financial performance and meet its goal of INR10bn (USD213.4m) in sales by financial year 2013.
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Delphi
Electronics, chassis, thermal and engine systems
Address Delphi Automotive Systems Pvt Ltd Technical Centre India, 5th Floor, Innovator Building, International Tech Park, Whitefield Road, Bangalore 560066 India Tel: +91 80 2841 2015 Fax: +91 24 0248 4403 Website: http://www.delphi.com Senior Officers Reji Varghese, President & Managing Director, Delphi India Majdi Abulaban, President, Delphi Asia Pacific Nambi Ganesh, Director, Technical Centre India Dominic Tan, Director, Product Engineering, Asia Pacific Products Air-conditioners, antennas, battery chargers, clusters, compressors, condenser assembles, DC-DC converters, engine management systems, evaporative emissions canisters, fuel modules, fuel pumps including modular reservoir fuel pump assemblies, heat exchangers, HVAC modules and systems, immobilsers, Li-ion battery packs & power boxes, lines & hoses, navigaction systems, powertrain cooling systems, start-stop systems, throttle bottles, traction inverters, wiring harnesses Plants India (3) Sales USD16bn (Year to 31.12.2011) India: NA Employees Group: 104,000 (2011) India c. 1,900 (2008)
Delphi Automotive Systems is a wholly owned Indian arm of Delphi. Delphi India complements Delphi's strong manufacturing network in the Asia-Pacific region.
Delphi has been present in India as a wholly-owned subsidiary since 1995. The company provides automotive solutions in the field of electrical distribution systems, fuel handling systems, exhaust systems, engine management systems, air-conditioning systems and suspension systems. Delphi supplies all three mainstream automotive segments including twowheelers, four-wheelers and commercial vehicles. Delphi operates three plants in India which are located at Dharuheda, Haryana; Gurgaon, Haryana and Greater Noida, Uttar Pradesh. The company also operates a technical centre in Bangalore, Karnataka and a jointventure with TVS named Delphi-TVS Diesel Systems Ltd in Chennai, Tamil Nadu (India). The company has been active on the exports front. Its export portfolio includes: gas charged shock absorbers, air-lift dampers, struts, drive shafts and drive shaft components, half shafts, steering columns and wiring harnesses. Delphi's Indian customers comprise Maruti Udyog, Hindustan Motors, Volvo and Telco. GM India, Fiat,
Recent Developments Corporate strategy Delphi India has gradually expanded its array of activities following a steep rise in the demand for automobiles in the country. The company which runs three plants in India is set to open a fourth one in Chennai, Tamil Nadu (India) to manufacture electronic components which are designed at its technical centre in Bangalore (India) and manufactured in Singapore. The decision to set up the facility in India will speed up the manufacturing process since the production will be shifted so as to be in close proximity to the develoment centre. Delphi has been operating in India since 1995 and invested USD200m in expansion related activities up until May 2010. The company plans to further grow and expand its sales in the country. Delphi Automotive Systems Pvt Ltd also secured three contracts to supply electronics components to small cars models in the country in 2010. Delphi India is laying strong focus on developing cost-effective solutions for its customers. For instance, Delphi India supplies instrument clusters for Tata Nano. The company claims that these are up to 30% cheaper than comparable products. The company also tripled its Indian technical centre lab space to 13,500ft2 in 2009. The expansion was undertaken to build an efficient technology network as the centre plays a vital role in providing embedded software support to the companys fastest growing product. Exports are a key area for the companys growth. Leveraging India's low cost of manufacturing and engineering capability, Delphi plans to grow its export and outsource research and development work. Joint-ventures In February 2006, Delphi formed a joint-venture with Roulunds Braking Systems SAS, to manufacture brake pads in India for global exports under the company- called Alliance Friction Technologies. Roulunds is a leading European supplier of original equipment (OE) and aftermarket automotive friction components.
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Investments In October 2009, Delphi expanded its technical centre located in Bangalore (India). The company has almost tripled the lab space to 13,500ft2, up from 4,000 ft2 and hired more employees. The centre is engaged in developing advance engineering applications including embedded software, mechanical engineering, product engineering design and other automotive engineering related fields. In July 2008, Delphi announced plans to open a facility in Chennai (India) to manufacture electronic and safety management system (EMS) products. The company invested INR300m (USD69.3m, 4 July 2008) which will initially produce instrument clusters and then move up with a range of products like air bags, seat belts, immobilisers and body computers (microprocessor-chip driven controls for a range of applications like wiper, headlamps and power windows). In April 2006, Delphi decided to invest USD10m over the following two years at its plant in Bangalore (India) to double the production capacity of half-shafts. The Bangalore facility also supplies to the companys European and North American operations. The increase in production capacity will support both local and global customers of the company.
Contracts In May 2010, Delphi Automotive Systems Pvt Ltd announced that it had won a contract to supply electronics components to three new small cars models in India. The company has not disclosed the name of the automakers and their models and other details. In 2008, Delphi started supplying driver information systems for Mahindra & Mahindras Ingenio model. Delphi supplies CRDi system to Tata Motors for the Safari Dicor model. The company won a contract from Maruti to supply suspension systems, air-conditioning and steering columns for the Swift model. Brands/OEMs Tata Mahindra Mahindra Mhaindra Renault & Model s Nano Xylo Logan Components Instrument cluster Instrument cluster Wiring Harness
Certifications Delphi India was certified with ISO 9002 certification in 1998. New Product Developments Delphi operates a technical centre in Bangalore, Karnataka (India) under the name-Technical Centre India (TCI). The centre established in 2000 is engaged in providing cost-effective technology and components development for small cars. These parts include electronic instrument clusters, immobilisers, controls for power windows and windshield wipers, and audio systems. The technical centre undertakes 15% of the development work for the Indian OEMs while the remaining 85% is catered specifically for the international automakers. The centre develops embedded software for Delphi's diesel common rail engine management systems and advanced mobile multimedia systems. The centre supports development programmes on gasoline powertrain, steering and braking control systems and has expanded its scope into product engineering. Further, design and engineering activities for fuel-handling systems and engine management systems are carried out. Delphi has lately been working on the development of web-based tools to automate engineering and business processes at Delphi Delco, Delphi's mobile electronics division. Financial Overview In the financial year ended 31 December 2011 Delphi reported a 16.1% increase in net sales to USD16bn over USD13.8bn in 2010. The company recorded strong growth in all regions. Delphi's sales increased in North America by 11% to USD5.1bn, in Europe, Middle East and Africa
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(EMEA) by 23.3% to USD7.3bn in Asia Pacific 13.2% to USD2.5bn and in South America by 5.2% to USD1.2bn. In addition to increased orders from its customers as a result of a surge in global vehicle production, the company benefited from favourable foreign currency exchange rates during the year. The company reported a 74.9% increase in its operating income to USD1.6bn over USD940m in the previous financial year. The company concluded the financial year with net income of USD1.1bn compared with USD 631m in 2010. All four operating divisions of the company recorded higher sales compared with the previous financial year. Powertrain Systems reported a 22% increase in sales to USD5bn, Electrical/Electronic Architecture Systems of 18% to USD6.6bn, Thermal Systems of 9% to USD1.8bn Electronic & Safety Systems of 8% to USD2.9bn. Delphi India is wholly-owned by Delphi Automotive. The parent company does not report its financial statements separately. Outlook Delphi India has well maintained its position in the domestic market since its inception in 1995. This can be seen from the new contracts wins, including the supplies to three small cars in 2010. Its contracts with Tata Motors, Mahindra & Mahindra and Maruti bear testimony to its focus. The continuing strong relationship with these OEMs and the recent contract win will help the company expand its sales in the near future. Continous focus on developing low-cost products will further stimulate the growth and help it win new contracts. The expansion of the technical centre will also help the company to cater to the growing demand for affordable technologies for the automobile sector worldwide. With Delphis plans to set up a unit in Chennai (India) it is set to tap the multibillion dollar electronic and safety management system (ESM) market, demand for which is expected to increase in the near future.
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Denso India
Electric motors, alternators and ECUs
Address Denso International India Private Limited Chimes, 61, Sector 44 Gurgaon-122003 Haryana India Tel: +91 124 4803 200 Fax: +91 124 4803 201 Internet: http://www.denso.co.in Senior Officers Yasushi Nei, Chairman and CEO, Denso International India Yoshitaka Kajita, Managing Director and COO Koji Shiga, Managing Director, Denso India Toshifumi Murayama, Denso Kirloskar Industries Hideto Naito, Denso Haryana Katsuyuki Oshaki, Denso Subros Thermal Engineering Centre India Products Alternators, blower motors, CDI, ECUs, engine cooling fans, fan washer pumps, flywheels, fuel gauges, fuel pumps, magnetos, power window, starter motors, ventilators, window washer, wiper motors Plants India (4): Haryana, Karnataka, Uttar Pradesh, Uttarakhand Sales Denso India: INR9.2bn (USD203.8m, 31 March 2011) (Year to 31.12.11) Employees c. 3,000 (2011)
Denso India is one of the largest suppliers of electric motors, alternators and electric control units (ECUs) in India. The company is a major supplier to Maruti-Suzuki.
Denso Corporation is present in India through a public company Denso India, in which the Japanese supplier has a 52.9% stake, and some other whollyowned subsidiaries. The company entered the Indian automotive market in 1984 through setting up a joint-venture with SRF India under SRF Nippondenso India Limited. The JV commenced production of electrical parts for passenger cars two year later. The companys name was later changed to Denso India Limited in 1996. In addition to Denso India, the parent company Denso operates three manufacturing subsidiaries and one technical centre and one engineering centre in India. All these subsidiaries including Denso India is managed by a holding company, Denso International India, based in Gurgaon, Haryana (India). Denso is also present in India through equity stakes in two major Indian suppliers, Subros and Pricol. In 1986, Denso entered into a three-party JV agreement with Suzuki Motors and Indias Suri family to supply airconditioners to Maruti Suzuki. The JV, Subros Limited, has emerged as the leading supplier of thermal systems to passenger cars and commercial vehicles in India. Besides, Denso entered into a technical agreement with major instrument cluster supplier Pricol in 1991. Six years later the company took a 12.5% equity stake in the Indian supplier. Denso Indias customers include Ford, Hero Honda, Hindustan Motors, Honda Motorcycles and Scooters, Honda-Siel Cars, Hyundai, Maruti Suzuki, Tata Motors, Toyota Kirloskar Motors and Yamaha. Recent Developments Corporate strategy Denso has stepped up its activities in India over the past two years. In January 2012, the company announced it will invest INR3bn (USD59.6m, 31 January 2012) to set up a new manufacturing plant in Gurgaon, Haryana. The new plant, which is expected to become operational at the end of 2013, will manufacture air-conditioning components like heat exchangers and various kinds of motors. The company, which operates one plant in Bangalore, Karnataka, is looking for land to set up another plant in southern India to cater to its automakers present there, including Ford, Hyundai and Toyota Kirloskar. The company is also focusing on introducing new products to supply its customers in India. In 2010 the company developed four heat exchangers for the Indian market. The company developed a new low-cost radiator, heater core, condenser and an evaporator, all manufactured from parts sourced from the local Indian market and on a single production line. The company is already supplying heat exchangers to Toyota Etios which went on sale in 2010. To support its customers in India, Denso is investing JPY3bn (USD35.8m, 30 September 2010) to set up a technical centre in Gurgaon, Haryana. The technical centre will develop automotive technologies for powertrains, electric and electronic systems, information and safety systems and small motors. This would help the company to collaborate better with its sales operations which would result in a faster response to customers demands. Denso has also set up an engineering centre in Noida, Uttar Pradesh, in partnership with Subros to begin design and development of car air-conditioning systems and other products in India. Joint-venture In June 2010, Denso entered into a joint-venture (JV) agreement with its long-term partner Subros. Under the agreement, the two companies established a company, Denso Subros Thermal Engineering Centre India
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Limited, to design car air-conditioning systems and other products. Denso will have a majority stake of 74% in the company while the remaining 26% will be with an Indian partner. The new JV is established at Subros Noida facility and has 40 engineers. The JV is expected to improve design and development capability of Subros to provide complete technical solutions in thermal business. The two partners plan to make an initial investment of INR136m (USD3m, 30 June 2010). Investments In January 2012, Denso announced plans to invest INR3bn (USD59.6m, 31 January 2012) to set up a new manufacturing plant in Gurgaon, Haryana (India). The new plant manufactures air-conditioning components like heat exchangers and various kinds of motors. Denso has acquired a 150,000m2 site for the plant which is expected to start operations by the end of 2013. In September 2010, Denso announced it would establish a technical centre in Gurgaon, Haryana (India) with an investment of JPY3bn (USD35.8m, 30 September 2010). The technical centre, Denso International India Pvt. Ltd. (DIIN), operates in collaboration with Denso Sales India Pvt. Ltd (DSIN). The new technical centre will develop automotive technologies for powertrains, electric and electronic systems, information and safety systems and small motors. The parent company of Denso plans to shift product development operations from Japan to the new technical centre in India. This will help in better collaboration with the sales operations which would result into faster response to customers demand. The technical centre became operational in 2011 and is expected to have 70 employees by 2015. Divestment In November 2011, Denso India decided to transfer its small motors business to Denso Haryana, another subsidiary of Denso for INR1.5bn (USD28.7m, 30 November 2011). Contracts Denso supplies heat exchangers to Toyota Etios. Denso India supplies electric motors for every Maruti Suzuki model. Denso India company supplies blower motors to Tata Motors. Denso Haryana supplies fuel gauges to Mark Auto and to other associate suppliers of Maruti. Denso Kirloskar supplies air-conditioners to Honda-Siel and Hindustan Motors for the Mitsubishi Lancer model. New Product Development Denso has established a technical centre in Gurgaon, Haryana (India). The centre is engaged in the development of technologies for powertrains, electric and electronic systems, information and safety systems and small motors. In January 2012, Denso displayed several advanced technologies at the 2012 Auto Expo held in New Delhi (India). The company introduced a full-colour, full-screen TFT liquid crystal instrumental cluster with nightview system. The system displays pedestrians or other obstacles in the roadway at night or under other poor-visibility conditions. Denso unveiled a new air-conditioning system that uses an ejector. Other products related to convenience include a remote touch controller which allows the driver to operate the car navigation system or the controls with little arm movement. In February 2011, Denso announced the development of four heat exchangers for the Indian market. The company developed a new low-cost radiator, heater core, condenser and an evaporator, all manufactured from parts sourced from the local Indian market and on a single production line. This has helped the company to significantly curtail production costs. The heat exchangers feature in the Toyota Etios, which was launched in India in December 2010.
Financial Overview Denso Corporation reported 5.4% increase in net sales to JPY3.1trn (USD37.7bn, 31 March 2011) in the financial year 31 March 2011, driven by increased vehicle production in North America and Asia. Higher sales led the company to report a 37.8% increase in operating income to JPY183.3bn (USD2.3bn) and 93.8% growth in net income to JPY143bn
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(USD1.3bn). Geographically, Denso reported positive sales volumes across all its regions except Europe where sales declined 2.4% to JPY401.3bn (USD4.8bn). The company's sales increased in Japan by 3.5% to JPY2.11trn (USD25.4bn), in North America by 13% to JPY536bn (USD6.4bn) and 22.2% in Asia and Oceania to JPY652.5bn (USD7.8bn), 4.3% in South America to JPY60.3bn (USD725.6m). The company does not separately disclose its sales in India. However the figure is reported to be around one-tenth of its sales in Asia and Oceania. Meanwhile, Denso India, which is publically listed subsidiary of Denso Corporation, reported net sales of INR9.2bn (USD203.8m, 31 March 2011) compared with INR7.4bn (USD163.5m, 31 March 2010). The company benefited from significant increased demand for its products from its customers who reported strong growth in vehicle production. However, the company witnessed a sharp increase in operating costs due to sharp increase in expense on raw materials, wages, depreciation and other charges. This led the company to record a sharp increase in earnings compared with the previous financial year. Denso India reported 81.9% decline in profit before tax (PBT) to INR51m (USD1.1m) compared with INR281.8m (USD6.3m) in the previous financial year. The company concluded the financial year with net profit of INR20.4m (USD0.5m), down 89.2% over INR188.9m (USD4.2m) in 2010. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 9,250.7 7,363.3 5,306..5 4,657.3 4,210.0 Net Sales (USDm) 203.8 163.5 101.7 116.7 96.9 Profit Before Tax (INRm) 51 281.8 286.2 428.2 440.2 Profit Before Tax (USDm) 1.1 6.3 5.5 10.7 10.1 Net Profit (INRm) 20.4 188.9 180.8 278.0 276.6 Net Profit (USDm) 0.5 4.2 3.5 7.0 6.4
Outlook Denso is shifting its focus to emerging markets to sustain its growth in the long term. The company has significantly strengthened its presence in the Chinese automotive market over the past two decades. The company is now concentrating on the Indian market, which is another high growth potential market in Asia. The company has so far had limited presence in India but the Japanese supplier is gearing up to play big role considering it is planning to more than double its sales by financial year (FY) 2015, over its sales in FY 2010. The company has enviable financial strength and technological capability to increase its presence significantly in the medium to long term.
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Endurance Systems
Alloy wheels, brakes, die-cast components, shock absorbers and transmission systems
Address Endurance Systems India Pvt. Ltd E-92, M.I.D.C. Industrial area Waluj, Aurangabad - 431 136 Maharashtra India
The Endurance Group is one of the leading suppliers of brake, suspension, transmission and aluminium die casting components. The company also manufactures alloy wheels for the automotive industry. In financial year 2011, the company generated 77.4% of its sales from India and the remaining 22.6% from overseas.
The Endurance Group began its business in 1985 in Aurangabad, Maharashtra (India) with the flagship company Anurang Engineering to produce aluminium die-casting products for the local two-wheeler major Bajaj Auto. Over the last two decades, the group has significantly diversified its customer base as well as its operations. The company organises its entire business in four units: Aluminium Casting: produces high and low pressure die-casting components, gravity die-casting products and alloy wheels. The company is the largest manufacturer of aluminium casting components in India. This is the largest business unit of the Endurance Group accounting for more than three-fifths of its sales. Transmissions: manufactures clutch assemblies for two and three wheelers, continuous variable transmissions (CVTs) and friction plates. Braking: makes hydraulic disc and drum brakes, master cylinder assemblies and brake shoes. Suspensions: produces shock absorbers for two- and three-wheelers, front forks for motorcycles, hydraulic and gas charged dampers, McPherson struts, gas springs for cars and light and heavy commercial vehicles.
Tel: +91 240 2564 595/582 Fax: +91 240 2569 703 Internet: http://www.endurancegroup.com Senior Officers
Naresh Chandra, Chairman Anurag Jain, Managing Director Satrajit Ray, CFO V. Subramanian, Senior Vice- President, Casting Divisions Ramesh Gehaney, Senior Vice- President, Proprietary Business Biswajit Choudhury, Vice -President, Aftermarket & Exports A.S. Bhalla, Vice-President, Operations - SBUCastings Business- Pune Sunil Kolhe, Vice-President, International Trade & Corporate Sourcing Dr. Mohan Godse, Vice-President, Product Development, Casting Vivek Kulkarni, CEO. Endurance Magneti Marelli Shock Absorbers (India) Pvt. Ltd.
Endurance Group's diverse Indian business is conducted through four companies: Endurance Magneti Marelli Shock Absorbers (India) which produces suspension products. High Technology Transmission Systems which produces clutch assemblies, friction plates and continuous variation transmissions. Endurance Overseas, the holding company for Endurance Fondalmec (Italy) which produces machining products. Amann Druckguss (Germany) which produces high pressure die casting and machining products.
Products
Aluminium die castings, alloy wheels, brake assemblies, brake shoes, clutches, clutch covers, clutch assemblies, continuously variable transmissions (CVTs), crank cases, cylinder heads, disc brakes, drum brake, front forks, friction plates, gas springs, gravity die castings, high pressure die castings, low pressure die castings, master cylinder assemblies, oil-pump housings, shock absorbers and struts, transmission housings
Endurance operates 19 plants, 16 in India and three in Europe. The company employed 4,287 people in 2010. The company has a diverse customer base comprising manufacturers of twowheelers, three-wheelers, passenger cars and commercial vehicles. The company major customers include Ashok Leyland, BMW, Bajaj Auto, Chrysler, Daimler, Fiat India, Ford India, Harley Davidson, Honda Motorcycle & Scooter India, GM, Hyundai India, ITEC, IVECO, John Deere, MAN, Mahindra & Mahindra, New Holland, PSA Peugeot Citron, Piaggio, Renault-Nissan, Royal Enfield, Suzuki Motors, Tata Motors, Volkswagen and Yamaha. In addition the company supplies to several leading tier one suppliers, such as Bosch, Getrag, Mahle and Tata Toyo.
Plants
India (16): Haryana, Maharastra (12), Tamil Nadu, Uttarakhand (2) Outside India (3): Germany (2), Italy
Sales
INR 32.1bn (USD707.1m, 31 March 2011)
Recent Developments
Employees
Corporate strategy Endurance is working to expand its product base. The company is investing in both product design and process technologies. In order to expand its product lines, the company has made selective acquisitions in Europe which has given it access to the technologies of the acquired companies. In addition, the company has entered into technical alliances with several global tier one suppliers such as Teksid, Wangfeng Auto, WP
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c. 4,287(31 March 2010)
Suspension and Akebono Brakes. The companys joint-venture with Magneti Marelli has significantly enhanced its ability to design shock absorbers for passenger cars and commercial vehicles. In addition to expanding product offerings, Endurance is focusing on process technologies to enhance the reliability and quality of its products. This is expected to reduce customer complaints, warranty claims and also significantly enhance customer satisfaction levels. Aftermarket is an important source of revenue for Endurance. The segment is not only less elastic to the volatility of demand as the original equipment (OE) market faces but this also offers a high margin. The company is increasing its presence in the aftermarket segment through expanding product portfolio of its aftermarket business from two- and three-wheeler shock absorbers and motorcycle front forks to include two- and three-wheeler clutches disc brake parts and passenger vehicle suspension products. In addition Endurance will continue its emphasis on growing exports as the company believes that it will allow it to establish new relationships with the OEMs in India and increase its domestic sales. Endurance has made firm plans to target the ASEAN and African aftermarket with its range of two- and fourwheeler suspension and brake products. Acquisitions In January 2009, Endurance increased its stake in Italy-based Fondalmec S.p.A from 51% to 100%. The company had acquired a 51% stake in the Italian supplier in 2007 for an estimated USD99m. Fondalmec has a machining plant and a die-casting plant in Turin (Italy). The company supplies its products to Fiat, GM, PSA Peugeot Citron and Renault. In January 2007, Endurance acquired Nuova Renopress of Italy for EUR23m (USD30m, 31 January 2007). Nuova Renopress is a supplier to Bosch, Continental and Honda. In December 2006, Endurance acquired 100% stake in Amann Druckguss of Germany for EUR42m (USD55m, 31 December, 2006). Aman Druckguss is a preferred supplier of speciality castings to customers like Daimler, MAN, John Deere, Porsche and Behr. In September 2006, Endurance acquired a 40% stake in the Italian front fork manufacturer Paioli Meccanica with whom it had arranged a technical alliance in 1997. Paioli Meccanica is also a leading manufacturer of front forks in Europe. Endurance has an option to increase its stake to 100%.
Divestment In August 2006, Endurance Group divested 15% stake in the holding company, Endurance Technologies, for a consideration of INR1.5bn (USD32m, 31 August 2006) in favour of Standard Chartered Private Equity Limited. The balance of the company is owned by the Jain family.
Joint-ventures In July 2008, Endurance entered into a Technical Assistance Agreement with Italy-based Teksid Aluminum to manufacture aluminum cylinder head castings by the Gravity Die Casting process. This agreement was a move towards Endurance entering into advanced aluminum castings. In June 2008, Endurance announced a 50:50 joint-venture with Magneti Marelli to manufacture shock absorbers in India and Thailand. The industrial facilities under the agreement are being created at Pune and Thailand. The company will focus specifically on design, production and marketing shock absorbers including semi-corner modules and gas springs for cars and commercial vehicles for OEMs and aftermarket in India and other Asian markets. The commercial production of fourwheeler struts/shock absorbers/gas springs for the Indian and the overseas market started at the plant in Pune in 2009. In 2008, Endurance entered into a Technical Assistance Agreement with WP Suspension, a subsidiary of KTM. In 2006, Endurance commissioned an R&D facility with its Italian partner for two-wheeler suspension applications. The facility was formed as a technical alliance and caters to European OEMs. The shock absorbers and front forks are sourced from Endurance run facilities in India.
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In 2003, High Technology Transmission Systems signed a joint-venture with Adler s.p.a. Italy to produce clutches. Adler holds 49% equity in the company while the balance is held by Endurance.
Investments In 2007, Endurance commissioned a global sourcing office for its supply requirements and a marketing office in Detroit, Michigan (US). In 2007 Endurance commissioned two new manufacturing plants in Pantnagar, Uttrakhand (India) for proprietary and castings. In 2007, Endurance commissioned its aluminium die casting unit at Chennai. The company supplies to several clients including Hyundai Motors, and Rane TRW. In 2006, Endurance announced the setting up of Endurance Far East Systems with a plant at Laemchambang in Thailands export promotion zone for production of suspension and brake systems for two- and fourwheeler aftermarket supplies in Africa and the ASEAN region at a capital cost of INR50m (USD1.15m, 31 March 2007). The plant was commissioned in September 2007. In 2006, Endurance commissioned five new units in India. This included one each in Manesar, Haryana; Aurangabad, Maharashtra; and three in Chakan, Maharashtra. The Manesar based plant caters to the needs of OEMs and other customers in the northern belt. The company has been supplying to Honda Motorcycle Scooter India facility in Manesar and Bosch facility in Jaipur from its Manesar plant.
Contracts Endurance has received USD20m worth of business for a Ford pick-up truck. Endurance has been supplying castings to Honda Motorcycle & Scooters India. Endurance has been supplying to various programmes run by Fiat India. Endurance is the largest supplier of castings to Mahindra & Mahindra. The relationship is particularly strong in case of five speed gearbox castings where Endurance holds a major chunk of M&Ms business. Globally, Endurance supplies front forks to Paioli Meccanica through a buy back arrangement and Yamaha in Spain and France. Yamaha has shown interest in sourcing its shock absorber requirements through Endurance. The company has also been supplying clutch assemblies and friction plates to global OEMs through Adler. Endurance supplies aluminium die casted components to Tata Motors and Hyundai Motors. Also, Endurance supplies aluminium die casted components for the Tata Indica platform. Endurance supplies gas filled shock absorbers for the Enfield Electra and Bajaj Pulsar. Endurance has also developed a shock absorber which can be used in both two-wheelers and four-wheelers
Certifications Endurance has received QS9000 certification for several of its manufacturing locations.
New Product Developments Endurance operates five R&D centres in India.

The company realigned its R&D activities in the 90s to help streamline products and localise borrowed technology according to the Indian conditions. The company has technical alliances with Adler, Akebono Brakes, Bassano Grimeca, Magneti Marelli, Paioli, Teksid, Wangfeng Auto and WP Suspension. Endurance developed flywheel housing for an Indian commercial vehicle manufacturer that resulted in weight reduction of nearly three kg. Endurance is seeking a patent for oil lock collar. Endurance systems has been granted a patent for its Dust seal washer. The group is seeking patents for its twin tube rechargeable canister type Oleo Pneumatic Shock Absorber. The company is also seeking patents for
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an improved oleopneumatic shock absorber for land vehicles. The company has designed and developed Hydraulic Shock Absorbers with externally adjustable damping force in rebound and compression. The company has developed and launched rechargeable type Gas Filled Shock Absorbers for two-wheelers, first time in India Endurance has come up with plastic canister shock absorbers which are inexpensive and can be fitted to scooters. Endurance has developed a spring-on-spring system.
Financial Overview In the financial year ended 31 March 2011 Endurance

Group reported sales of INR32.1bn (USD707.1m, 31 March 2011). The company generated INR28.8bn (USD546.9m, 31 March 2011) from the domestic sales and INR7.27bn (USD160.1m, 31, March 2011) from overseas sales. Endurance is a privately held company and does not publish its financial data. Year 2011 2010 2009 2008 2007 Sales (USDm) 729 513 314 324 326
Outlook Over the past few years, Endurance has significantly diversified its business from a two-wheeler castings provider to a multi-product supplier across the two-wheeler, passenger cars and commercial vehicles. The company has realised this with the help of some selective acquisitions and technical alliances with other suppliers which helped it to diversify its product lines.
During this period the company also reduced its dependence on Bajaj Auto which accounted for 51.4% of its 2010 sales compared with 95.1% in 2006. This reduced dependence is largely on account of sales to customers which were added through overseas acquisitions, Amann Druckguss and Fondalmec. Supplying to the OMEs in international markets offers an opportunity to Endurance when an international OEM sets up its manufacturing base in India, thereby giving the company advantage over other players. Endurance now counts almost all major automakers operating in India as its major customers. Aluminum is emerging as a preferred metal for global automakers in order to meet stringent regulations in the area of reducing fuel consumption and vehicle emissions. Endurance is well positioned to gain from this emerging trends of the global automotive industry as aluminum die-casting components continues to remain a major business area for the company, accounting for more than 60% of its sales.
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EXEDY India
Clutch disc assemblies and clutch cover assemblies
Address EXEDY India Limited Plot No L-4 MIDC Industrial Area Chikalthana Aurangabad, 431210 India Tel: +91 24 0248 4014 Fax: +91 24 0248 4403 Website: http://eil.exedy.com/ Senior Officers Mahesh B Kothari, Director & Executive Chairman Pradeep B Chinai, Managing Director Akira Hirai, Managing Director Products Automatic transmission parts, clutch cover, clutch disc, sports clutch, torque converter Plants India (2) Sales Group: INR2bn (USD44m, 31 March 2011) (31.03.2011)
EXEDY India, a subsidiary of EXEDY Corp is a leading supplier of clutch products and allied components for passenger cars, light commercial vehicles, heavy commercial vehicles. The company was formerly known as Ceekay Daikin Limited and changed its name to Exedy India Limited on 15 November 2010.
Ceekay Daikin was incorporated in 1973 and commenced production in 1977 after Exedy Corporation (Daikin) became a collaborator and an equity partner with a 32.12% holding. In June 2010, EXEDY raised its holding to 50.19% which later moved up to 69.14% in October 2010. In November same year, Ceekay Daikin changed its name to EXEDY India Limited. EXEDY India manufactures manual clutches for passenger and commercial vehicles (four- and three-wheelers) and one-way clutches for motorcycles. The company has one facility each in Aurangabad (Maharashtra, India) and Greater Noida (Uttar Pradesh, India). During fiscal 2010, EXEDY India produced 1.46 million units clutch discs, 1.32 million units of clutch covers and 1.02 million units of one way clutches, respectively. As of 31 March 2010, the company had an installed capacity of 2,200,000, 1,800,000 and 1,400,000 units per annum of clutch plate assembly, clutch cover assembly and one way clutches. EXEDY India Limited serves customers including AVTEC Ltd, GM India Private Ltd, Honda Siel Cars India Ltd, Maruti Suzuki India Limited, Tata Motors, Ltd, Swaraj Mazda Ltd, Toyota Kirloskar Motor Private Ltd and VE Commercial Vehicles Ltd.
Employees
Group: 814 (31 October 2010)
Corporate strategy In view of the increasing demand from automotive customers in India, EXEDY India expanded its production facilities and upgraded its infrastructure. The company had earlier decided against increasing production capacity, expecting the demand to subside. EXEDY India which exports to countries including Indonesia, Singapore, Srilanka, Australia and the US aims to further increase its exports. The move will help the company expand its array of offerings and at the same time contribute to sales. Like every other supplier, EXEDY India is also facing an increase in the prices of steel. In an attempt to cope with this, the company started sourcing non-critical press and machining supplies from vendors to rein in input costs. Acquisitions In May 2011, EXEDY Corp acquired the remaining 6.06% stake in EXEDY India Limited for INR64.9m (USD1.4m, 31 May 2011) in cash. EXEDY Corp already had a 69.14% stake in the company and a 24.8% stake is held by the Indian promoters of Exedy India. The acquisition of remaining 6.06% equity of Exedy India from public shareholders has led to delisting Exedy India from Bombay Stock Exchange. Investments In January 2012, Exedy Clutch India (ECI), a subsidiary of Exedy India received approval to establish a plant to manufacture multi-plate clutches, continuance variable transmission (CVT), clutch disc, clutch cover assembly and components for both two- and four-wheelers at Narasapur industrial area, in Karnataka (India). The approval was granted on 16 December 2011 and is valid for the next two years. In 2006, Ceekay Daikin announced plans an INR200m (USD4.5m, 31 December 2006) expansion of its Noida and Aurangabad facilities.
Recent Developments
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Contracts Ceekay Daikin supplies to the Honda Accord programme. The company also supplies to LCV programmes run by Tata Motors, Eicher Motors and Swaraj Mazda. OEM/Brand MarutiSuzuki Honda Toyota Model Alto, A-Star, Omni, Swift, Swift Dzire, SX4, Versa, Wagon R, Zen Estilo City Corolla Component Clutch assembly
Clutch assembly Clutch assembly
Certifications Both facilities run by Ceekay Daikin are accredited with TS 16949 status. The Uttar Pradesh facility also has ISO 14001 and OHSAS 18001 accreditation. Financial Overview During the financial year ended 31 March 2011, EXEDY India posted a 27.7% increase in sales to INR2bn (USD44m, 31 March 2011) compared with sales of INR1.6bn (USD35.5m, 31 March 2010) in 2010. Loss before tax for the period increased from INR11.2m (USD248,723) to INR65.3m (USD1.4m). The net profit figures also remained the same as loss before tax. Year 2011 2010 2009 2008 2007 Year Net sales (INRm) 2,056.4 1,609.5 1,070.2 1,025.4 919.8 Net sales (USDm) 45.2 35.7 20.5 25.6 21.1 Profit before tax (INRm) (65.3) (11.2) (73.8) (37.2) 46.3 Profit before tax (USDm) (1.4) (248,723) (1.4) (932,331) 1 Net Profit (INRm) (65.3) (11.2) (74.7) (26.6) 39.6 Net Profit (USDm) (1.4) (248,723) (1.4) (666,667) 911,567
2011 2010 2009 2008 2007
Outlook EXEDY India has been incurring losses since financial year (FY) 2008. The company is burdened by high cost of capital borrowing and interest payments which is negatively hampering its profits. However, focusing on the sales side of the figure, the company has shown a decent jump backed by the booming demand for vehicles in India. The increasing trend for sales is however expected to show a fall as the high interest rate and the surge in the prices of petrol has pushed down demand for vehicles in India after March 2011. Considering this, the companys move to strengthen its exports will help to counter the decrease in sales figure. Further, the outsourcing of non-critical operations has helped EXEDY India contribute positively to its operating profit. The company will continue to practise the purchasing strategy up until prices stabilize in the domestic country. Moreover, the majority ownership by EXEDY Corp will help the company gain technological expertise from its parent company and at the same time help it expand its customer base. For instance, Nissan could bring additional business for the company due to EXEDY corporations relationship with Nissan in Japan.
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Exide Industries
Batteries
Address
Exide Industries Limited Exide House, 59 E Chowringhee Road Kolkata 700 020
Exide Industries is a leading supplier of lead acid batteries in India. The company manufactures a broad range of batteries ranging from 2.5 ampere-hour (Ah) to 20,400Ah. The company supplies batteries two-wheelers and passenger cars. The company also supplies batteries to non-automotive sectors such as defence, railways, mining, hospitals, telecommunications, airlines signalling and computer hardware.
Formerly known as Chloride Industries, Exide Industries organises its business into three segments automotive, industrial applications, and submarines. The company's flagship automotive battery brands 'Exide' and 'SF' (Standard Furukawa) have a strong presence in the Indian market. The companys other brands include Chloride, Index, Dynex, SF Sonic, Jupiter and Conrex. The company operates seven manufacturing facilities in India three in Maharashtra, two in West Bengal, and one each in Haryana and Tamil Nadu. Exide has a technical alliance with Shin-Kobe Electric Machinery Co. Ltd., a part of Hitachi Group (Japan) for automotive batteries. The company's Taloja unit in Maharashtra has a technical collaboration with the Furukawa Battery Co. Ltd. (Japan) for automotive batteries. On 31 March 2011, the company had 5,151 employees. In financial year 2011, the company generated 94.8% of its sales from India and the remaining 5.2% from the overseas markets. The company has a domestic market share of 45% in Industrial, 72% in Automotive original equipment (OE) market and 73% in automotive aftermarket. The company has a 70% share in Organized Retail. Exide has a strong presence in the aftermarket with a network of approximately 4,000 dealers across India. In addition to the domestic market, Exide exports its products to Europe, Middle-East, Africa, South America, SAARC and ASEAN region. Exide customers include Ashok Leyland, Bajaj Auto, Cummins, Escorts, Fiat India, Force Motors, Ford India, GM India, Hero, Honda Siel, Hyundai India, Mahindra & Mahindra, Maruti Suzuki, New Holland Tractors, Swaraj Mazda, Tata Motors, Toyota Kirloskar India, Volkswagon Group and Yamaha. Recent Developments Corporate Strategy Exide is focusing on expanding capacities to meet increased demand from automakers. The company invested INR2.75bn (USD60.6m, 31 March 2011) in financial year 2011 in capacity expansion and has earmarked INR3.7bn (INR81.5m) for capital expenditure for 2012. The company is investing in ramping up capacities at its six manufacturing facilities to meet expected growth in demand. The company has also started operations at a new motorcycle battery manufacturing plant at Ahmednagar in Maharashtra (India). Exide is diversifying its product offering to the automotive industry. The company is working on lithium-ion batteries for use in hybrid and electric vehicles (HEVs) and electric motorbikes. The company has partnered with China-based Changxing Noble Power Sourcing Company Limited to produce Deep Cycling Electric Bike batteries for electric bike and scooters. Exide is developing batteries for stop-start micro-hybrid vehicles in collaboration with its Japanese technical partner Furukawa Battery Company. The company has recently developed Idle Stop-Start batteries for Mahindra & Mahindra. In addition, the company is exploring the possibility of developing and producing lithium-ion batteries for electric vehicles.
Tel: +91 033 2283 2120/ 33/ 36/50 Fax: +91 33 2283 2642 Internet: http://www.exideindustries.com Senior Officers
RG Kapadia, Chairman RB Raheja, Vice-Chairman TV Ramanathan, Managing Director & CEO PK Kataky, Director, Automotive G Chatterjee, Director, Industrial AK Mukherjee, Director, Finance & CFO
Products
Lead acid batteries
Plants
India (7): Haryana, Maharashtra (3), Tamil Nadu (1), West Bengal (2)
Sales
INR47.7bn (USD1bn, 31 March 2011) (Year to 31.03.11)
Employees
5,151(31 March 2011)
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Meanwhile Exide is focusing on increasing its presence in the replacement market. The increased presence in the aftermarket will help the company to reduce its dependence on the OE market. In addition, this is expected to improve Exides profitability as the replacement market offers greater margin than the OE market. Acquisitions In June 2008, Exide acquired a 51% stake in the Leadage Alloys India for INR350m (USD8.16m, 19 June 2008). The company hopes to benefit in terms of self-sufficiency in lead as well as gain better control over recycling of used batteries bought back from the market as part of regulatory framework for storage battery manufacture. The deal will also help Exide to have better control over the disposal of used batteries and plastics in a more environment friendly way In October 2007, Exide acquired Tandon Metals Pvt Ltd, a smelting company based in Pune, Maharashtra. Exide plans to scale up the companys smelting capacity for substituting lead imports. In 2000, Exide acquired 49% of shares in Associated Battery Manufacturers (Ceylon) Limited (Sri Lanka). Associated Battery was subsequently made a subsidiary of Exide. In 2005, Associated Battery Manufacturers (Ceylon) Ltd became a 61% subsidiary of the company.
Investments In financial year 2011, Exide invested INR2.75bn (USD60.6m, 31 March 2011) in capacity expansion at its facilities to meet surging demand. The company has earmarked INR3.7bn (INR81.5m) for capital expenditure for 2012. In 2008, Exide announced an INR1.8bn (USD 42.8m, 25 July 2008) expansion plan for capacity expansion of both automotive and industrial batteries.
Contracts In 2009, Exide started supplying batteries to Toyota Fortuner. In 2008, Exide commenced supplying batteries to Fiat Linea. In 2008, Exide started supplying batteries to GM Spark. In 2008, Exide started supplying batteries to Hyundai i20. In 2007, Exide commenced supplying batteries to Hyundai i10. In 2007, Exide commenced supplies to Mahindra Renault Logan programme. In 2006, Exide commenced battery supplies to Tata Ace. Also in 2006, Exide was awarded a contract to supply batteries to the GM Chevrolet Aveo programme in India. Exide is the OE supplier of batteries for Honda City, Honda Accord, Hyundai Santro, Hyundai Accent, Hyundai Sonata, Maruti Suzuki Wagon R, Mitsubishi Lancer, Tata Indica, Tata Indigo, Mahindra Scorpio and Bolero models. New Product Developments Exide spent INR97.7m (USD2.1m) on research and development in the financial year ended 31 March 2011. This was equivalent to 0.2% of the company sales. The company has a technical collaboration with Japan-based Shin Kobe Denki and Furukawa Battery Company. The company is working on the development of batteries for stop-start micro hybrid vehicles in collaboration with Furukawa Battery Company Limited Japan. Exide is also exploring the possibility of developing and marketing lithium-ion batteries for electric vehicle segment. Exide has recently developed Idle Stop Start batteries for Mahindra & Mahindra. The company has also developed batteries for Toyota Fortuner, and Maruti Suzuki Alto. In 2007, Exide entered into a pact with research organisation Atraverda Ltd of UK for the joint development of bi-polar technology to produce smaller and lighter environmentally friendly batteries. In 2006, Exide developed a range of ultrasonically sealed zeromaintenance batteries adapted to Indian service conditions. Also in 2006, Exide was granted an international patent for a vented type leak resistant motorcycle battery.
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In 2005, Exide developed new batteries for fitment in Mahindra Scorpio, Hyundai and Toyota Qualis models. The company also developed batteries for OE supplies to Tata Motors and Ashok Leyland. In the same period, Exide developed batteries for CNG/LPG powered three-wheelers in the replacement market. The range was later extended with batteries for diesel powered three-wheelers. Exide commenced production of thin tubular standby batteries at the Haldia (West Bengal) plant in 2V HR containers to improve cost competitiveness. Exide Industries has developed a 200Ah battery.
Certification Exide Industries has been accredited with ISO 9001, QS9000 and ISO 14001 certification by RWTUV. Its plants Hosur (Karnataka), Chinchwad (Maharashtra) and Taloja (Maharashtra) plants have been certified with TS 16949 certification.
Financial Overview In the financial year ended 31 March 2011 Exide
Industries reported a 19.8% increase in consolidated net sales to INR47.7bn (USD1bn, 31 March 2011) compared with INR39.8bn (USD845.2m, 31 March 2010) in the previous year. Strong growth in demand from the automotive industry led the company to record higher sales during the year. The company recorded a 24% increase in sales in automotive batteries while industrial batteries sales grew at a relatively moderate 16%. In addition the company reported increase in exports of industrial batteries of 40% compared with the previous financial year, while exports of automotive batteries increased by 16%. The company reported profit before tax of INR9.6bn (USD210.8m), up 8.6% compared with INR8.8bn (USD195.8m) in the previous financial year. Exide reported an increase in profit before tax despite 33.2% increase in expenses on materials consumed during the financial year to INR28.1bn (USD619m). Higher profit was mainly driven by availability of lead and lead alloys from the companys two captive lead smelters, favourable foreign exchange translation and continuing focus on controlling costs. The company concluded the financial year with a net profit of INR6.2bn (USD136.3m), up 25.4% compared with INR4.9bn (USD109.6m) in the previous financial year. Year 2011 2010 2009 2008 Year 2011 2010 2009 2008 Net Sales (INRm) 47,660.8 39,788.6 34,048.7 29,798.3 Net Sales (USDm) 1,049.8 883.6 652.6 746.8 Profit Before Tax (INRm) 9,572.5 8,817.3 4,522.8 3,898.5 Profit Before Tax (USDm) 210.8 195.8 86.7 97.7 Net Profit (INRm) 6,188.2 4,935.2 1,914.9 1,643.7 Net Profit (USDm) 136.3 109.6 36.7 41.2
Outlook As a leading supplier of lead acid battery in India, Exide has
benefited from the surge in demand from the automotive sectors, and has been ramping up capacities at its facilities. High growth potential of the Indian automotive market is resulting in the entry of several new companies. This is expected to result in an increase in competition among the battery suppliers in coming years. Cheap imports, mainly from China, are further expected to intensify the competition. In an attempt to stay ahead of the competition, Exide is investing in R&D capabilities. The company is also diversifying into new areas such as batteries for hybrid and electric vehicles. The continuing high price volatility of lead, the main raw material used in the production of battery, is a major concern for Exide. This not only results in
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increase in cost but also uncertainty in procurement. The company is working to mitigate the high price impact through various efforts to increase production from its captive smelters.
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Faurecia
Exhaust systems
Address Faurecia 2, rue Hennape 92735 Nanterre Cedex France Tel: +33 1 7236 7000 Fax: +33 1 7236 7007 Internet: http://www.faurecia.com India Office Faurecia 86/1 Kumbalgodu Industrial Area, Phase II, Mysore Road, Bangalore, Karnataka - 560 074 India Senior Officers Yann Delabrire, Chairman & CEO Frank Imbert, CFO Arnaud de David-Beauregard, Executive VicePresident, Group Strategy Development Bruno Montmerle, Executive Vice-President, Group Strategy Development Patrick Koller, Executive Vice-President, Seating Products Group Christophe Schmitt, Executive Vice-President, Interior Systems Product Group Jean-Marc Hannequin Executive VicePresident, Exhaust Systems Product Group Products Emission control technologies, interior systems, seating Plants India(6): Gujarat, Haryana, Karnataka, Maharashtra, Tamil Nadu (2) Outside India: Argentina (4), Belgium, Brazil (10), Canada, China (5), Czech Republic (5), France (40), Germany (22), Hungary, Italy, Luxembourg, Mexico (9), Morocco, Netherlands (2), Poland (8), Portugal (8), Romania (2), Slovakia (8), South Africa (5), South Korea (2), Spain (21), Sweden, Thailand, Tunisia, Turkey (2), UK (3), US (18) Sales Group: EUR16.2bn (USD20.9bn, 31 December 2011) (Year to 31.12.11) Employees Group: 84,179 (December 2011)
Faurecia, owned by PSA Peugeot-Citron, is the leading manufacturer of exhaust systems in the global market. The company also manufactures automotive seating, interiors, exhaust systems, front-end modules and safety modules. PSA Peugeot Citron holds 57.43% shares in Faurecia.
Faurecias operations are divided into two business segments: Interior Modules: Automotive Seating (accounted for 30.7% of sales in 2011): seats Interior Systems (22.5%): cockpits, instrument panels, door modules and panels, and acoustic & soft trims. Other Modules: Emission Control Technologies (35.7%): catalytic converters, decoupling elements, diesel particular filter (DPF) system, exhaust heat recovery system (EHRS), fabricated manifolds and light weight mufflers, self actuated valves for exhaust systems. Automotive Exteriors (11%): front-end modules, exterior equipments (bumpers, front end carriers and engine cooling systems) and safety modules. After the acquisition of EMCON Technologies, Faurecias Exhaust Systems business was changed to form Faurecia Emissions Control Technologies. The group is ranked number one in the manufacturing of exhaust systems. In total, the company has 238 production facilities in 33 countries globally, employing 84,179 people. In 2011, Faurecia generated 14.1% from France, 24.3% from Germany, 23.6% from Rest of Europe, 20.7% from North America, 4.5% from South America, 10.9% from Asia and 1.7% from the rest of the world. In India, Faurecia operates six manufacturing plants of which two are located in Chennai, Tamil Nadu and one manufacturing plant each in Bangalore, Karnataka; Sanand, Gujarat, Manesar, Haryana and Pune, Maharashtra. In addition, it has one research and development (R&D) centre in Bangalore, Karnataka and one design and development centre in Pune, Maharashtra. Faurecia has manufacturing presence in Emission Control Technology and Automotive Seating business units. Faurecias Emission Control Technologies business operates in India through a joint-venture with Anand Group formed in 1997. The JV was originally formed between the Anand Group and ArvinMeritor. But in 2007, ArvinMeritor sold its Emission Control Business unit to Faurecia. Faurecias biggest customers, PSA Peugeot Citron and Volkswagen, contributed 16.6% and 25.3% of the companys total 2011 sales. Other major customers include BMW, Chrysler, Daimler, Ford, Hyundai, Renault Nissan and Toyota. Recent Developments Corporate Strategy In November 2011 Faurecia increased its medium-term guidance expecting sales of EUR20bn (USD26.7bn, 30 November 2011) by 2015 compared with the previous forecast of EUR16bn (USD22bn) in 2014. The strong growth is based on a portfolio of contracts under development that represent sales of approximately EUR34bn (USD45.3bn) over their lifetime. The company also expects an operating margin of between 5% and 6%, a return on capital employed (ROCE) in excess of 25%, and a ratio of net debt to earnings before interest, tax, depreciation and amortisation (EBITDA) below 0.5. The company will focus mainly on expansion in the international market to meet its medium-term financial goals. Faurecia expects to grow rapidly in Asia, especially in China where it is expecting to see sales double to EUR4.9bn
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(USD6.5m) by 2015 and South Korea, as well as in North America where sales will be boosted by a wider range of customers. Another key market in Asia region for Faurecia is India, where the company has recently strengthened its presence. In January 2010, Faurecia acquired Yutaka Autoparts Pune Private Limted which manufacturers exhaust system components. The acquisition strengthened the companys manufacturing presence in Emission Control Technologies in India. In addition, Faurecia bought the complete ownership of its joint-venture (JV) Taco Faurecia Design Centre (TFDC) located in Pune, Maharashtra (India). Acquisitions In August 2010, Faurecia Emission Control Technologies India, a subsidiary of Faurecia acquired Yutaka Autoparts Pune Private Limted, a manufacturing company of Japan-based Yutaka Giken. The acquired company operates a manufacturing plant in Pune, Maharashtra (India) which manufactures exhaust manifold, converter assembly, silencers and brake discs for automotive applications. The financial details of the acquisition were not disclosed. In January 2010, Faurecia bought complete ownership of its joint-venture (JV) Taco Faurecia Design Center (TFDC) located in Pune, Maharashtra (India). With this, TFDC became a wholly-owned subsidiary of Faurecia. The company was established in 2004 as a result of a 50:50 JV deal with Taco Auto Comp System. The centre works for several research and development (R&D) and design centres located in 10 countries, primarily for the company's Vehicle Interior business unit. Investments In January 2008, Faurecia announced plans to set up a new manufacturing plant near New Delhi in India. The plant will produce seating mechanisms and will cater mainly to the requirements of Maruti Suzuki India Limited. In 2007, Emcon India, now owned by Faurecia announced the setting up of its engineering and development center in Bangalore at a capital cost of USD 600,000. New Product Developments In the financial year to 2011, the company spent EUR759.6m (USD983.5m) on R&D, compared with EUR689.1m (USD927m) in 2010. Faurecia has 38 R&D and technical centres and about 4,000 research employees worldwide. Financial Overview For the financial year ended 31 December 2011 Faurecia reported a 17.4% increase in sales to EUR16.2bn (USD20.9, 31 December 2011) compared with EUR13.8bn (USD18.3m, 31 December 2010) as sales increased across all business groups and regions. The companys revenue also benefited from the sales reported by the acquired business of Angell-Demmel (consolidated in January 2011) that amounted to EUR117.4m (USD152m) and the seat systems facility in Madison (US) that was acquired in April 2011, which contributed EUR108.3m (USD140.2m) to the total sales. The companys operating income increased 42.6% to EUR650.9m (USD842.8m) compared with EUR455.6m (USD612.9m) in the previous year while net income was up by 84.1% to EUR371.3m (USD480.7m) against EUR201.7m (USD271.3m) in the previous year. Year Sales (EURm) 16,190.2 13,795.9 9,292.2 12,010.7 12,660.7 Sales (USDm) 20,963.9 18,559.6 Operating Income (EURm) 650.9 455.6 (91.7) 91.2 121.1 Operating Income (USDm) 842.8 612.9 Net Income (EURm) 371.3 201.7 (433.6) (574.8) (237.5) Net Income (USDm) 480.7 271.3 R&D Expenditure (EURm) 759.6 689.1 493.2 613 268.6 R&D Expenditure (USDm) 983.5 927 No. of Employees 84,179 75,676 58,414 61,357 69,713 No. of Employees 84,179 75,676
2011 2010 2009 2008 2007 Year
2011 2010
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2009 2008 2007
12,270.5 18,964.9 16,881.5
(121.1) 144 161.5
(572.6) (907.6) (316.7)
651.3 967.9 358.1
58,414 61,357 69,713
Outlook Over the past few years Faurecia has followed a mix of both organic and inorganic routes to strengthen its global presence. Following some big ticket acquisitions such as Plastal and EMCON Technologies, the company is acquiring small companies and assets such as Johnson Controls seating plant in Madison, Mississippi and Fords Automotive Component Holding (ACH) plant in Saline Michigan (US). In addition, the company is investing in capacity expansions in Asia and other markets to strengthen its global presence. Faurecia has significant presence in India. The company is expected to benefit from the market re-entry of its parent automaker PSA Peugeot Citron in India announced in 2011. The French automaker is investing EUR650m (USD883.8m, 30 September 2011) in an integrated plant in Sanand, Gujarat which will have initial capacity of 170,000 units a year which could be increased in the future.
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Federal Mogul Goetze

Pistons and piston rings
Address Federal-Mogul Goetze (India) Limited 10th Floor Tower B, Paras Twin Towers Sector-54, Golf Course Road Gurgaon -122002 Haryana India Tel: +91 124 478 4530 Fax: +91 124 429 2840 Website: http://www.federalmogulgoetze.com/ Senior Officers K.N. Subramaniam, Chairman Jean Humbert Louis de Villardi de Montlaur, President & Managing Director Dan Brugger, Whole-time Director, Finance & CFO Andreas Kolf, Executive Director, Opeartions Swapan Gayen, Head, Information Systems Vinod Hans, Head, Original Equipemnt Sales Madhur Aneja, Aftermarket Sales Alok Manaktala, Head, Supply Chain Management Products Crank pins, cylinder liners, gudgeon pins, light metal castings, pistons, piston pins, piston rings, sintered metal products, valve train components, synchroniser hub, oil pump rotor and gears Plants India (5) Punjab, Karnataka , Rajasthan, Tamil Nadu, Uttarakhand Sales INR9.5bn (USD208.5m, 31 December 2010) (Year to 31.12.2010) Employees 4,501 (December 2010)
Federal-Mogul Goetze is India's largest manufacturer of pistons and piston rings. The company makes a diverse range of piston rings and pistons varying from 30mm to 300mm diameter. The company supplies to all major two-wheelers, three-wheelers, passenger cars and commercial vehicles.
Federal Mogul Goetz started as Goetze India in 1954 as a joint-venture between Germany-based Goetzewerke Friedrich Goetze and the Escorts Group. The company began with a manufacturing plant in Patiala, Punjab (India) to produce piston rings and cylinder liners. The company later expanded its product offering and added manufacturing plants in Bangalore, Karnataka; Bhiwadi, Rajasthan and Udham Singh Nagar, Uttarakhand. The company also set up a new manufacturing plant in Chennai, Tamil Nadu which became operational in 2011. Meanwhile, the companys ownership also underwent some changes. In 2006, Federal Mogul increased its stake in the company from 25.4% to 50.1%. The US supplier also changed the name of the company to Federal-Mogul Goetze (India) Limited. Later in 2009 the parent company raised its stake in the Indian subsidiary from 50.1% to 74.98%. Federal-Mogul Goetze classifies its business into two segments OEM and aftermarket. The company produces a range of sintered metal products for a range of engine and automotive applications such as valve train parts, transmission parts, lubrication pump parts and other engines. The company also produces structural parts such as timing pulleys, gears and thrust plates. Federal-Mogul Goetze sells its pistons and piston rings range of products under the brand name Goetze, while its sintered products are sold under the brand name Brico Goetze. Federal-Mogul Goetze has currently one subsidiary Goetze TPR (India) which is engaged in manufacturing steel rings for bi-wheelers. The company enjoys a diverse customer base and it caters to two-wheelers, three-wheelers, passenger cars, sports-utility vehicles (SUVs), tractors, light commercial vehicles (LCVs) and heavy commercial vehicles (HCVs). FederalMoguls major customers include Ashok Leyland, Bajaj Auto, Eicher Motors, Escorts, Fiat India, Force Motors, Hero MotoCorp, Hindustan Motors, Mahindra & Mahindra, Royal Enfield, SML Isuzu, Tata Cummins, Tata Motors, TVS Motors and Yamaha. In addition to the domestic market, the company exports its products to several international markets. Rcent Development Corporate strategy Federal-Mogul Goetze is focusing on its core business in area of powertrain components such as pistons and piston rings. In addition, the company is concentrating on light metal castings and sintered metal products. This strategy has led the company to hive its non-automotive business. In 2010, the company sold its stake in its wholly-owned subsidiary, Satara Rubbers & Chemical, to Akme Projects. The subsidiary manufactured rubber. Meanwhile, the company is strengthening its presence in its core business. In September 2011, the company announced its plans to establish a new manufacturing plant in Chennai, Tamil Nadu (India) to produce brake friction materials for the original equipment (OE) and aftermarket segments for automotive, and also for construction, railway and industrial customers. Focusing on the product development side, Federal-Mogul Goetze is developing lightweight components which have gained attention in the last few years mainly because of the improved fuel-consumption. The demand for these components will further increase as strict emission norms come into force.
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Investments In September 2011, Federal-Mogul Goetz announced that it was investing USD15m to set up a new plant in Chennai, Tamil Nadu (India). The plant, spread on an area of 38,000m2, will produce brake friction materials for the original equipment (OE) and aftermarket segments, for automotive, construction, railway and industrial customers. The plant became operational in 2011. In 2009, Federal-Mogul Goetze expanded capacity at its existing plants in Bangalore, Karnataka and Patiala, Punjab (both in India). The company invested INR680m (USD14.5m, 31 December 2009) in the expansion process. The company also upgraded its machinery at both these plants. Divestments In April 2010, Federal-Mogul Goetze sold its entire investment in the shares of Satara Rubbers & Chemical, its wholly owned subsidiary to Akme Projects. Certifications Federal Mogul Goetzes facilities in Bangalore, Rajasthan and Patiala, Punjab are TS 16949 and ISO 14001 certified, while the Bhiwadi facility is TS 16949 certified. New Product Development Federal Mogul Goetz spent INR24.9m on Research and Development (R&D) in 2010, which was equivalent to 0.3% of total sales. The company is focusing on the development of components which help engines meeting improved performance in terms of fuel consumption, friction and oil consumption. The company is also working on the development of components for engines meeting emission legislations. Financial Overview In the financial year ended 31 December 2010 Federal Mogul Goetz reported an 18% increase in consolidated net sales to INR8.9bn (USD196.4m, 31 December 2010) compared with INR7.6bn (USD161.7m, 31 December 2010) in the previous year. The companys strong growth during the financial year was driven by increased demand from both OEMs and aftermarket. In addition, the company benefited from exports which increased 17.2% to INR621.9m (USD13.4m) compared with INR530.5m (USD11.3m) in the previous financial year. Despite growth in sales the company recorded decline in earnings primarily due to sharp increase raw material prices which increased by 39.6% to INR2.9bn (USD63.7m) compared with INR2.1bn (USD44.8m) in the preceding year. Federal Mogul Goetz witnessed a 6.5% decline in profit before tax (PBT) to INR713.9m (USD15.7m) compared with INR763.8m (USD16.3m). The company concluded the financial year with net profit of INR399.9m (USD8.8m) compared with INR545.2m (USD11.6m) in the previous year. Year 2010 2009 2008 2007 2006 Year 2010 2009 2008 2007 2006 Net Sales (INRm) 8,946.2 7,583.8 6,934.7 6,228.3 4,510.4 Net Sales (USDm) 196.4 161.7 139.5 157.9 102.2 Profit Before Tax (INRm) 713.9 763.8 88.5 (99.8) 6.4 Profit Before Tax (USDm) 15.7 16.3 1.8 (2.5) 0.1 Net Profit (INRm) 399.9 545.2 (17.1) (170.2) (44) Net Profit (USDm) 8.8 11.6 (0.3) (4.3) (1)
Outlook After taking over the management control of Goetze India, FederalMogul is in a better position to leverage its technological expertise, professional management and global distribution network. The company is also optimistic about receiving more orders from US based automakers operating in India. There is also a high probability of catering to the parent companys global requirements through outsourcing from bases in India. However, given the current demand scenario, international supplies will depend on cost
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competitiveness which is vulnerable to a host of dynamic external factors. Federal-Mogul Goetze enjoys a wide customer base which will help it sustain its business in cyclical downturns in the automotive industry. The company caters to all segments of the Indian automotive industry including twowheelers, three-wheelers, passenger cars, utility vehicles and commercial vehicles. In addition to OEMs the company has a strong presence in the aftermarket which acts as a buffer-zone during periods of slowdown.
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Fenner India
Automotive belts, oil seals, power transmissions
Address Fenner India Limited Khivraj Complex II 5th Floor, 480, Anna Salai Nandanam, Chennai 600 035 Tamil Nadu India Tel: +91 44 2431 2450 Fax: +91 44 2434 9016 Website: http://www.fennerindia.com Senior Officers Raghupati Singhania, Chairman VP Singhania, Managing Director AN Ravichandran, President & Director C Suresh Kumar, VP, Sales & Marketing M Balakrishnan, Senior VP, Operations V Abraham, VP, Technology & Development Raj Menon, General Manager, Exports Products Belts, clutches, couplings, gear boxes, oil seals, oil seals, poly v- belts, pulleys, raw edge cogged belts, shaft mounted speed reducers, taper-lock bushes, timing belts, vbelts, variable speed drives Plants India (5): Andhra Pradesh (3), Tamil Nadu (2) Sales INR 4.9bn (USD107.9m, 31 March 2011) (Year to 31.12.11) Employees c. 2,810 (31 March 2008)
Fenner India, a part of JK Group, is a leading supplier of belts, oil seals and power transmission products catering to the requirement of both automotive and industrial sectors. The company caters to both original equipment (OE) market and aftermarket.
Fenner International, the earlier owner of Fenner India, started its operations in India in 1929 as a trading company. In 1955, the company set up its whollyowned subsidiary in India as Fenner Cockill Limited. The name of the company was changed in 1975 to Fenner India Limited. In 1987, JK Group acquired Fenner India. The company operates five plants in India, of which three are located in Tamil Nadu and two in Andhra Pradesh. In Tamil Nadu, Fenner India operates two plants in Madurai and one in Chennai. While the Madurai facilities manufacture belts and oil seals, the Chennai plant is involved in the production of oil seals and moulded rubber products. The companys plants in Hyderabad produce power transmission accessories as well as belts and oil seals. Fenner India has a diverse customer base. The company supplies to Ashok Leyland, Force Motors, GM, Hindustan Motors, Mahindra & Mahindra, Maruti-Suzuki, Tata Motors and Volkswagen. The company also supplies to major tier one suppliers including American Axle & Manufacturing, Bosch, Dana, Delphi-TVS, Eaton, Rico Auto, Schaeffler, Timken, TRW, Visteon and ZF India. In addition, the company exports its products to more than 50 countries across the world. Recent Developments Corporate strategy Fenner India aims to sustain a compound annual growth rate (CAGR) of 30% in coming years. In order to support its growth plans, in October 2011, the company announced it would invest INR3bn (USD60.7m, 31 October 2011) over the next three four years in capacity expansion, research and development (R&D) and testing capabilities. In the past three years Fenner India recorded CAGR of 25%. The companys strong growth during this period was driven by significant demand in the domestic market and surge in exports. Over the past two years Fenner India has invested INR1.2bn (USD24.3m) in capacity expansion. The company is also looking towards several selective acquisitions to complement its organic growth. Fenner is currently evaluating four companies. The company intends to increase its sales and hopefully exceed its target of doubling sales by 2015 compared with its 2010 sales level. Like other Indian suppliers, Fenner India is keen on expanding its exports as a way to expand its sales. The company has entered some new exports markets in the recent past including North and South America and South-East Asian countries. The company also supplies its components to Asia-Pacific and west Asia. In a bid to distinguish its products from competitors, Fenner launched a range of new products under the brand name "JK Pioneer" which includes engine mounts, centre joint rubbers and suspension bush kits for commercial vehicles and passenger cars in the automotive Segment Investments In October 2011, Fenner India announced plans to invest INR3bn (USD60.7m, 31 October 2011) over the next three four years. The company will invest in capacity expansion, research and development (R&D) and testing capabilities. In 2009, Fenner India opened a manufacturing plant in Chennai, Tamil Nadu (India) which produces belts. The company has decided to invest USD7m in the facility by 2012 with plans to additional machines at the
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facility. In March 2007, Fenner India invested INR1bn (USD23m, 31 March 2007) in a bid to expand its production. The investment included expansion of the companys two manufacturing units in Madurai, Tamil Nadu (India). The company invested INR500m (USD11.5m) in the Nilakottai facility and INR200m (USD4.6m) in the Kochadai facility. In February 2006, Fenner India announced the opening of two new facilities in India; one in Chennai, Tamil Nadu (India) and the other in Hyderabad, Andhra Pradesh (India). While the plant in Chennai manufactures oil seals, the Hyderabad plant makes raw edge cogged and multi-rib belts. The company made a total investment of INR400m (USD9m, 28 February 2006) in the project INR250m (USD5.6m) in the Hyderabad facility and INR150m (USD3.4m) in the Chennai facility. This was part of the companys expansion drive and upgrading its existing facilities.
Certifications Fenner India plants are accredited with ISO 9001:2000, ISO 14001:1996 ISO/TS16949:2002 and OHSAS ISO18000 quality certificates. Financial Overview In the financial year ended 31 March 2011 Fenner India reported a 28.9% increase in consolidated net sales to INR4.9bn (USD107.9m, 31 March 2011) compared with INR3.8bn (USD84.4m, 31 March 2010) in the previous year. The company benefited from strong demand in the domestic automotive markets. Higher sales led the company to report a net profit of INR488m (USD10.7m), 29.4% up compared with INR377m (USD8.4m) in the previous financial year. Fenner India is a privately owned company of JK Industries. Therefore the company does not publish the details of its financial performance. Outlook Over the years, Fenner India has successfully added rubber and rubber metal bonded components to its product portfolio, thereby expanding its array of offerings. The company is likely to retain its leadership in both automotive belts and in oil seals businesses in India after increasing its focus, by divesting its conveyor belt business followed by expansions in the core business. Fenner India stands to benefit from the growing penetration of international automakers and suppliers in India. Considering the rising scope of automotive activities in the country, the company hopes to win new contracts in the near future. The production ramp-up plans further support the companys strategy to expand its sales.
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Fiem
Automotive lighting equipment & mirrors
Address
Fiem Industries Limited Plot No.1915, HSIIDC Rai Industrial Estate Phase-V, Distt. Sonepat Haryana-131029 India
Fiem Industries is one of the major suppliers of automotive lighting and signalling equipment in India. The company also supplies rear view mirrors and sheet metal components for the automotive industry. In financial year 2011, the company generated 96.8% of its sales from India.
Fiem started as a lighting equipment manufacturer and then diversified into rear view mirrors. Over the years the company has emerged as a major supplier of lighting and mirrors to the automotive industry through its eight plants based in three clusters and a tax free zone in India. The company employs around 1,200 people. The company generates 95% of its revenues from OEM sales. Feim supplies mainly to two-wheeler, passenger car and commercial vehicle customers in India and exports through buy-back arrangements with its joint-venture partners. Fiems OEM customers include Ashok Leyland, Bajaj Auto, Eicher Motors, Escorts, Fiat India, Force Motors, GM, Hero Motors, HMT, Honda Motors and Scooters India, Hyundai India, Kinetic, LML, Mahindra & Mahindra, Majestic Auto, New Holland, Scooters India, Sonalika, Skoda, Swaraj Mazda, TAFE, Tata and TVS.
Tel: +91 130 2367

902/905/906/907/910/911 Fax: +91130 2367 903 Internet: http://www.fiemindustries.com
Senior Officers
J K Jain, Chairman and Managing Director Anchal Jain, Full-time Director Seema Jain, Full-time Director Kashi Ram Yadav, Full-time Director, Manufacturing Operations, North India J S S Rao, Full-time Director, Manufacturing Operations, South India
Recent Developments
Products
Auxiliary lamps, cable harness assemblies, exhaust pipes, fog lamps, frame assemblies, head lamps, interior lamps, light emitting diode (LED) lamps, mirrors, mudguards, petrol tanks, plastics and sheet metal components, rear combination lamps, reflex reflector, sheet metal components-complete frame assembly, side indicator lamp, silence cover, stands, warning triangle, tail lamps, work lamps
Corporate strategy Fiem is investing in new capacity as well as expansion of existing capacities in India to meet expected surge in demand from both twowheeler and four-wheeler segments. In March 2011, the company established a new plant in Tapakura in Alwar, Rajasthan to exclusively supply Honda Motorcycle and Scooter India and Honda Seil Cars. Fiem will manufacture plastic moulded parts, which is a new product line for the company. The company also commenced production at another greenfield plant in Rai in Sonepat, Haryana. The new plant manufactures automotive lighting products for four-wheelers industry. In addition, Fiem is investing in modernisation of its Kundli plant which will result in capacity expansion. The company is entering into several key alliances to diversify its product offering for the automotive industry. In 2008, Feim entered into a technical assistance agreement with the Spanish company BATZ S. Coop to manufacture complete pedal box assembly. The company has also a technical alliance with Korea Air Conditioners for the production of automotive radiators, heating elements and air-conditioning systems. Joint-Ventures In July 2010, Fiem signed a Memorandum of Understanding (MoU) with Japan-based Ichikoh Industries to set up a joint-venture (JV) for manufacturing automotive lighting and signalling equipment. The JV caters to the four-wheeler businesses in northern and eastern India. The company has also signed another MoU with Ichikoh to form another strategic alliance to acquire the two-wheeler automotive lighting business in the global market. In April 2008, Fiem signed a licence and technical assistance agreement with the Spanish company BATZ S. Coop to manufacture complete pedal box assembly for GM. In September 2006, Feim signed a memorandum of Understanding (MoU) to establish a 60:40 JV with Korea Air Conditioners Ltd for the production of automotive radiators, heating elements and air-conditioning systems with 50% buy-back commitment. The JV has its manufacturing facility in Hosur, Karnataka. Also in September 2006, Fiem signed an MoU with ZADI Divisione Fanaleria CEV Spa, Italy, for a 60:40 JV to manufacture and supply
Plants
India (8): Rajasthan, Haryana (2), Himachal Pradesh, Karnataka, Rajasthan, Tamil Nadu (3)
Sales
INR4.3bn (USD93.9m, 31 March 2011) (Year to 31.03.11)
Employees
Group: 1,200 (31 March 2011)
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locking systems. Investments In July 2010, Fiem announced plans to establish its eighth plant at Industrial Area Tapukara, Alwar in Rajasthan, exclusively for its customer, Honda Motorcycle and Scooter India Pvt. Ltd and Honda Seil Cars. The plant became operational in March 2011. In March 2007, Fiem commenced construction work for a new plant in Rai Industrial Area in Sonepat in Haryana. The plant became operational in July 2010. It manufactures automotive lighting products for the fourwheeler industry. In 2006, Fiem established an Export Oriented Unit (EOU) at Hosur in Tamil Nadu for supply of mirror plates to Ichikoh Industries. The Japanese supplier provides technical assistance to the Indian partner. Also in 2006, Feim announced the setting up of a plant at Nalagarh (Himachal Pradesh) to service tractor and two-wheeler manufacturers. The plant became operational in January 2007.
Contracts In 2011, Fiem commenced supplies to Tata Motors. In 2007, Fiem won an order from Yamaha India. In 2006, Fiem commenced supplies of auto mirror plates to Ichikoh Industries, Japan from its Hosur based Export Oriented Unit.
Certifications Fiem Industries has been accredited with ISO 14001:2004, ISO/TS 16949:2002, ISO 9001:2000, QS 9000, ISO 9002 and COP compliance for RDW, Netherlands for E-marked products.
Research and Development: Feim invested INR7.3m (USD16,080) in research and development (R&D) in the financial year 2011 over INR4.5m (USD9,993) a year ago. However, R&D as percentage of sales continues to remain extremely low at 0.2% of sales. The company has set up its in-house R&D unit at its Rai plant in Sonepat, Haryana (India).
Financial Overview In the financial year ended 31 March 2011 Fiem reported a 44.2% increase in net consolidated sales to INR4.3bn (USD93.9m, 31 March 2011) compared with INR2.9bn (USD65.7m, 31 March 2010) in the previous year. The strong growth in the companys sales was driven by increased demand from its customers in the domestic market, led by a 27% surge in vehicle production during the financial year.
Despite strong growth in sales the company reported a marginal decline in profit before tax (PBT) to INR154.9m (USD3.4m) over INR156.6m (USD3.5m) in 2010. The companys profitability during the financial year was adversely impacted mainly due to loss on settlement of currency forward contract during the financial year. The company concluded the financial year with net profit of INR110.6m (USD2.4m) compared with INR105.7m (USD2.3m) in 2010. On standalone basis, Feim reported a 41.8% increase in net sales to INR4.2bn (USD91.1m) compared with INR2.9bn (USD65.3m) in the preceding year. The company recorded profit before tax (PBT) of INR157.8m (USD3.5m), marginally up by 0.6% compared with INR156.8m (USD3.5m). Feim concluded the financial year with a net profit of INR114.3m (USD2.5m) over INR107.5m (USD2.4m). The company generated sales of INR3.3bn (USD72.7m) from Automotive Lighting, Signalling Equipment and Parts, INR590.1m (USD13m) from Rear View Mirrors, Prismatic Mirrors & Mirror Plates, INR158.3m (USD3.5m) from Sheet Metal Parts, INR79.2m (USD1.7m) from Moulds and INR43m (0.9m) from Other Miscellaneous Items. Year 2011 2010 Net Sales (INRm) 4,265.3 2,958.6 Profit Before Tax (INRm) 154.9 156.6 Net Profit (INRm) 110.6 105.7
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2009 2008 2007
2,192.9 1,772.9 1,683.3
78.9 142.3 155.8
46.1 93.4 135.5
Year 2011 2010 2009 2008 2007
Net Sales (USDm) 93.9 65.7 42.0 44.4 38.7
Net Profit (USDm) 2.5 2.4 0.9 2.3 3.1
Outlook Fiems strategy of diversifying its product lines is expected to help it

to have a more balanced portfolio, in term of its exposure to two-wheelers and four-wheeler segments, and a broadened customer base. The diversification is also expected to help Fiem find new avenues of sales, though the company generates about 75% of its sales from Automotive Lighting and Signalling Equipment business. This will eventually enable the company to cross the INR5bn (USD110m) mark in sales over the next two to three years as far as revenue is concerned. The company is also expecting more orders from its overseas customers which would help to increase its exports. Also the strategic co operation agreements that it has inked with Ichikoh Industries should help it to increase its global presence further as well as add to its technical expertise.
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Gabriel India
Ride control products
Address Gabriel India Limited th 29 Milestone Pune Nasik Highway Village Kuruli, Taluka Khed Pune- 410501 Maharashtra India Tel: +91 2135 610 700/757 Fax: +91 2135 261200 Internet: http://www.gabrielindia.com Senior Officers Deepak Chopra, Chairman Arvind Walia, Managing Director Manoj Kolhatkar, Joint-Managing Director Alok Agarwal, Vice-President, Finance CS Subramanian, Director Marketing, OEDomestic & Exports Amitabh Srivastava, GM & Head, Aftermarket, Domestic & Exports Products Front forks, front struts, shock absorbers Plants India (6): Haryana, Himachal Pradesh, Madhya Pradesh, Maharashtra (2), Tamil Nadu Sales INR9.6bn (USD211.8, 31 March 2011 ) (Year to 31.03.2011 ) Employees 2,500 (March 2011)
Gabriel is the flagship company of the Anand Group, one of leading auto-component majors in India. The company is amongst the leading manufacturers of ride control products. The company serves the OEM, replacement and export markets.
Gabriel India was established in 1961 as a joint-venture between Anand Automotive and Gabriel (USA) to manufacture shock absorbers. The company latter diversified its product portfolio and now produces a wide range of ride control products. Gabriel supplies its products to two-wheelers, three-wheelers, passenger cars, utility vehicles and commercial vehicles. In addition, the company supplies to Indian Railways. The company operates six manufacturing plants in India located in Gurgaon in Haryana, Parwanoo in Himachal Pradesh, Dewas in Maharashtra, Nashik and Pune in Maharashtra and Hosur in Tamil Nadu. These manufacturing facilities have combined capacity to produce 21 million shock absorbers and struts, and 2.7 million front forks. The company also operates three research and development (R&D) centres located in Pune and Nasik and Hosur. Gabriels plants in Pune and Gurgaon cater to passenger car segments. The Pune plant manufactures suspension products, while the plant in Gurgaon produces gas-charged shock absorbers mainly for Maruti Suzuki. This facility also delivers suspension products to the European platforms of Suzuki's models. The company serves commercial vehicle manufacturers through plants in Dewas and Pune. The company supplies to most of the automakers operating in India. Some of the passenger vehicles customers which Gabriel serves are Fiat, Ford, GM, Hindustan Motors, Hyundai, Mitsubishi, Mahindra & Mahindra, Renault, Maruti-Suzuki, Tata Motors and Toyota. In the area of commercial vehicles, the company supplies products to Ashok Leyland, Eicher Motors, Force Motors, Mahindra & Mahindra, Swaraj Mazda and Tata Motors. Corporate strategy Gabriel India continues to focus on strengthening its domestic presence by gearing up its investment activities to meet surging demand from its customers. The company invested INR550m (USD12.1m, 31 March 2011) in capacity expansions and quality improvement during financial year 2011 and has earmarked INR1.5bn (USD33m) for the next two to three years to strengthen output, improve quality and reserach and development Part of the investment will be directed towards fulfilling the new contracts secured which includes suuplies to Maruti-Suzuki India Ltd (MSIL) for the Alto, Wagon R, and SX 4 diesel models. The company has secured a contract to supply Hondas Brio and Toyotas Corolla Altis diesel versions. In the international markets, the company has added OEMs including Volvo and Daimler to its customer base and has got a letter of intent (LOI) from Nissan seeking its intentions to procure parts from Gabriel. Gabriel India is setting up a new manufacturing plant in Sanand, Gujarat (India) to supply Tata Nano. The company is a major supplier of front struts and rear shock absorbers for Tatas ultra cheap small car. Having a manufacturing plant near the customers assembly plant will help the company reduce its logistics cost. In addition to new plant at Sanand, Gabriel has undertaken expansion work at its Khandsa, Gurgaon,Haryana (India) facility which mainly supplies Maruti-Suzuki India Ltd (MSIL). In the area of commercial vehicles Gabriel already supplies to top three players in India Tata, Ashok Leland and Mahindra & Mahindra. The company has prepared itself well in advance to meet the growing demand from commercial vehicle OEMs by expanding its Parwanoo facility in 2010. The company also plans to make its Dewas plant the hub for exports of commercial vehcile products.
Recent Development
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Gabriel plans to invest INR300m (USD6.6m) in research and development activities from 2011 to 2014 to enhance its technological expertise and develop new products. The company has completed development programmes for Volkswagens Vento, Polo and Fabia with deliveries to begin in June 2012. Other activities, including improving the material flow of the Chakan facility, were undertaken with the sole intention of eliminating material movement and improving the quality of the product. Investments In 2010, Gabriel India set up a manufacturing plant in Sanand in Gujarat (India) to supply Tata Nano. In 2010, Gabriel India expanded capacity at its plants in Hosur, Tamil Nadu and Parwanoo, Himachal (both in India) for commercial vehicle business. The company also expanded capacity at its Khandsa plant in Gurgaon, Haryana (India) which mainly serves Maruti-Suzuki India Ltd (MSIL). In 2009, Gabriel India established an aluminium casting facility at its Chakan plant in Pune, Maharashtra (India). The facility manufactures outer tubes which are used in front forks. In November 2008, Gabriel India inaugurated a manufacturing facility in Parwanoo, Himachal Pradesh (India). The facility manufactures shock absorbers for commercial vehicles and two-wheelers, struts for passenger cars and front forks for motorcycles. The plant employs 217 people.
Contracts In 2011, Gabriel India secured a contract to supply Hondas new compact car Brio. This allowed the company to become a supplier to Honda cars. In 2011, Gabriel India started supplying to Toyota Corolla Altis Diesel model. In 2011, Gabriel India completed development activities for Volkswagen Polo and Vento and Skoda Fabia. The company will commence supply in 2012. In 2010, Gabriel India won contracts from several automakers both in the domestic as well as in international markets. Maruti-Suzuki India Ltd (MSIL) extended the contract with the company by supplying for Wagon R, SX4 diesel and Alto models. In the international markets, the company has added OEMs including Volvo and Daimler to its customer base and has a letter of intent (LOI) from Nissan seeking its intentions to procure parts from Gabriel. In 2010, Gabriel India secured a contract to supply piston rods to Mandos plant in Chennai, Tamil Nadu (India). The company is producing the components at its Khandsa plant in Gurgaon, Haryana (India). In February 2006, Gabriel India signed a supply contract with US-based ArvinMeritor, to supply ride control modules and components for OEMs and aftermarket. Arvin Meritor holds a 15.6% equity in the company. 100% shock absorber requirement of Tata Motors in the SUV segment. The company supplies front and rear struts for the Tata Indica model.
New Product Developments Gabriel incurred total expense of INR51.3m (USD1.1m, 31 March 2011) on research and development (R&D) activities in the financial year ended 31 March 2011. The R&D was equivalent to 0.5% of the companys sales during the financial year. The company intends to invest INR300m (USD6.6m) in various R&D activities by 2014 to upgrade existing skills and capabilities and also in the development of new products and processes. Gabriel India has an R&D centre for four wheelers at Chakan near Pune, Maharashtra, (India) and for two- and three-wheelers in Hosur, Tamil Nadu (India). The company also has a product validation centre at its Nashik facility in Maharashtra (India). The company has technology tie ups with partners including Kayaba Industry Co. Ltd, (Japan) for developing struts for Toyota Corolla Altis, Toyota Innova, and various models of Maruti including Alto, Wagon R and SX4. KYB Suspensions, Europe, SA a wholly owned subsidiary of Kayaba Industry provided technology for Ford Fiesta and Mahindra Renault Logan and Hyundai Santro for 2012 model year vehicles.
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The company has developed the following new products in recent years: In 2010, Gabriel developed ALL-Disc design for passenger cars. The product provides greater consistency in damping forces. In 2010, Gabriel developed a new range of bores for commercial vehicles. The product is under validation for shock absorbers. In 2010, Gabriel announced that it had developed load adaptive damping (LAD) which ensures smooth ride. The product was successfully tested on three different customer vehicles. Financial Overview In the financial year ended 31 March 2011 Gabriel India recorded net sales of INR9.6bn (USD211.8m, 31 March 2011), an increase of 37.8% compared with sales of INR6.9bn (USD153.2m, 31 March 2010) in 2010. The companys sales in the domestic market increased 36.2% to INR9.3bn (USD204.8m) comapred with INR6.8bn (USD152.1m) in the previous financial year. Meanwhile Gabriel Indias exports more than doubled to INR292m (USD6.4m) over INR126.1 (USD2.8m) in 2010. Higher sales led the company to report a 67.7% increase in profit before tax (PBT) to INR590.8m (USD13.1m) compared with INR352.2m (USD7.8m) in the previous financial year. The company concluded the financial year with net profit of INR453.4m (USD9.9m) over INR240.4m (USD5.3m) in 2010. Year 2011 2010 2009 2008 2007 Net Sales (INRm) 9,617.0 6,974.0 5,202.5 4,674.9 5,612.6 Profit Before Tax (INRm) 590.8 352.2 72.3 123.6 981.5 Net Profit (INRm) 453.4 240.4 56.1 76.5 731.1
Year 2011 2010 2009 2008 2007
Net Sales (USDm) 211.8 154.8 99.7 117.2 129.2
Profit before tax (USDm) 13.1 7.8 1.4 3.1 22.6
Net Profit (USDm) 9.9 5.3 1.1 1.9 16.8
Outlook Gabriel continues to win new business from a diverse group of customers, including contracts from Maruti Suzuki, Volvo and Daimler. The company which experienced around 38% sales growth in the financial year 2011 anticipates sales to grow further backed by new contracts secured in 2010. Several global automakers are setting up plants in India. As a leading supplier of ride control products Gabriel India is well positioned to grow in the coming years. Gabriel India has set a target to achieve sales of USD1bn by 2012. Considering the series of capacity expansion undertaken since 2010 and the planned investment announced by the company through to 2013, Gabriel is well positioned to achieve its sales traget. The company expects a 45% increase in exports in financial year 2012, in view of the new orders received from Renault Iran, Gabriel Colombia, and Venezuela and Yamaha.
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GKN Driveline India

Constant velocity joints, drivelines and sideshafts
Address GKN Driveline India Plot No. 270 Sector-24, Faridabad-121005 Haryana India Tel: + 91 129 409 1100 Fax: + 91 129 223 0580 Internet: http://www.gkndriveline.com Senior Officers DV Kapur, Chairman Ravindra Ojha, Managing Director Mansoor Anwar, Director DP Mehta, Director Products Constant velocity joints (CVJs), driveline parts, driveshafts, geared power transmission products, propshafts, sideshafts Plants India (4): Haryana (2), Maharashtra, Tamil Nadu Sales INR5.9bn (USD130.1m, 31 December 2010) (Year to 31.12.2010) Employees 1000 (2011)
GKN Driveline India is a susidiary GKN Driveline, the worlds leading supplier of driveline components. The Indian subsidiary manufactures driveline, constant velocity joints (CVJ) and sideshafts.
GKN Driveline has been present in India since 1985. The company operates three manufacturing plants in the country located at Dharuhera and Faridabad in Haryana; and Oragadam, Tamil Nadu. The company is a market leader in the front-wheel driveshaft axle assembly (DAA) in India. In addition the company is setting up its fourth plant in Pune, Maharashtra to serve its customer based in the western part of the country. GKN Driveline Indias parent company GKN Driveline generated 3% of 2010 sales from India. The Indian subsidiary supplies to several customers including Fiat, Ford, GM, Honda, Hyundai, Mahindra & Mahindra, Maruti Suzuki, Tata Motors, Toyota Kirloskar, and Volkswagen. Recent developments Corporate strategy GKN Driveline continues to strengthen its presence in India. In June 2011, the company commenced construction work for a new plant in Pune, Maharashtra to produce constant velocity joint (CVJ) systems and trans-axle solutions for its local customers. The upcoming plant is strategically located near the company's key customers such as Fiat, GM, Tata and Volkswagen, in the western region of the country. The plant is expected to be operational by 2012. In addition, in 2010 GKN Driveline decided to invest INR1bn (USD21.3m, 31 January 2010) to ramp up capacities at its existing production facilities in India. The company also agreed to set up a forging plant at its Orgadam facility in Tamil Nadu with an investment of INR500m (USD10.6m). The plant commenced production in 2011. As part of the expansion in the Indian automotive industry, the company is looking to enter the differential business. The company currently deals in the constant velocity joint (CVJ) systems in India. GKN Driveline is currently discussing the differential business potential customers in the Indian market. Investments In June 2011, GKN Driveline broke ground on a new manufacturing facility in Pune, Maharashtra (India) to produce constant velocity joint (CVJ) systems and trans-axle solutions for its customers in the country. The company will invest INR1.3bn (USD28.6m, 9 June 2011) to establish the facility spread over an area of 8,000m2. Employing more than 200 people, the facility is expected to be on stream by September 2012 with an annual production capacity of more than 600,000 units of CVJ system. This could be further expanded to 1.2 million units if required. It will also produce differentials for the companys trans-axle solutions. In January 2010, GKN Driveline announced that the company will invest INR1bn (USD21.3m, 31 January 2010) by 2012 to expand existing production capacity to meet surging demand. The company will also invest INR500m (USD10.6m) in setting up a forging plant at its Orgadam facility in Tamil Nadu (India). The facility became operational in November 2011. In February 2008, GKN Driveline opened a manufacturing facility at Oragadam, near Chennai, Tamil Nadu (India). The plant replaced GKN Drivelines plant in Gummidipoondi, whose production was transferred to the new facility. The facility manufactures sideshafts, supplied mostly to OEMs based in the southern India. The company invested INR1bn (USD25m, 29 February 2008) in the new facility. GKN Driveline further invested INR320m (USD8m) in the facility in the same year to expand its production from 660,000 drieshafts per annum to 1.8 million units a year in 2010.
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Contracts GKN Driveline supplies driveshafts to Tata Nano and Indica Vista. GKN Driveline supplies driveshafts to Volkswagen Polo. GKN Driveline supplies driveshafts to Mahindra & Mahindra Xylo GKN Driveline supplies driveshafts for the Toyota Corolla Altis. GKN Driveline supplies to Swift and Zen Estilo models. GKN Driveline supplies to the Hyundai Santro and Accent models. Certifications GKN Driveline India's Faridabad, Haryana (India) plant is accredited with ISO 9002 certificate. All plants of the company have been awarded the QS 9000 and TS 16949 certificates. Financial Overview In the financial year ended 31 December 2010, GKN Driveline India reported net sales of INR5.8bn (USD127m, 31 December 2010), marking a 32.4% increase compared with INR4.4bn (USD93.1m, 31 December 2009) in 2009. The companys operating profit increased 27.7% from INR663.7m (USD4.1m) to INR847.9m (USD18.6m), while the profit before tax (PBT) was up 36.9% to INR547.1m (USD12m) over INR399.5m (USD8.5m) in the previous financial year. The company posted net profit of INR366.8m (USD8m) compared with INR290.7m (USD6.1m) for the same period in the corresponding year. For the financial year 2011, GKN Driveline expects to post sales of INR7bn (USD153.6m, 31 December 2010) in the fiscal year 2011 and anticipates sales to grow to INR10bn (USD219.5m) by 2015.
Year 2010 2009 2008 2007 2006
Net Sales (INRm) 5,785.3 4,368.0 4,217.8 3,307.7 2,918.1
Operating profit (INRm) 847.9 663.7 625.6 601.0 566.9
Profit before tax (INRm) 547.1 399.5 394.7 440.8 429.2
Net profit (INRm) 366.8 290.7 256 280.5 275.4
Year
Sales (USDm) 127.0 93.1 84.8 83.9 66.1
Operating profit (USDm) 18.6 4.1 12.6 15.2 12.8
2010 2009 2008 2007 2006
Profit before tax (PBT) (USDm) 12 8.5 7.9 11.1 9.7
Net profit (USDm) 8 6.1 5.1 7.1 6.2
Outlook GKN Driveline recorded annual growth of more than 15% in the past five years in India. The company expects the country to continue recording strong growth in the medium to long term. GKN Driveline will continue to invest in new capacity to meet the expected surge in demand for its products from automakers operating in India. GKN Driveline has maintained its market leadership in driveline products with access to critical technology from its parent company. As the demand for vehicles is robust in India, the companys plan to expand production levels will drive the companys profitability level in the near future. Going forward, the company will continue to post robust top-line growth on the back of healthy volume growth following the invetsment activities line-up through 2012.
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Goodyear India
Tyres and rubber products
Address
Goodyear India Ltd st Plot 8, 1 Floor ABW Elegance Tower Commercial Complex, Jasola New Delhi- 110025 India
Goodyear India is the Indian subsidiary of the US-based Goodyear Rubber & Tyre Company. The Indian unit manufactures and sells tyres for most applications including passenger cars, commercial vehicles and farm tractors. The parent company holds a 74% stake in the Indian subsidiary.
Goodyear has been present in India since 1922 when the US-based parent company established Goodyear Tyre and Rubber company (India) Ltd for trading in tyres and other rubber products. In 1961, the Indian subsidiary was converted into a public limited company and its name changed to Goodyear India Ltd. Over 35 years later in 1997, Goodyear established a 50:50 jointventure with CEAT under the name South Asia Tyres (SAT) to manufacture steel radial tyres at its Aurangabad (Maharashtra) facility. Soon the JV ran into trouble and Goodyear bought CEAT's entire share in the company and made it a wholly-owned subsidiary. In February 2010, Goodyears parent company Goodyear Tyre & Rubber Company extended an offer to acquire the remaining 26% stake in the Indian subsidiary. Goodyear India applied to be delisted from the Stock Exchange in June same year. However, the company remained listed as the offer failed due to weak response from investors. Presently, Goodyear operates two manufacturing plants in India, one located in Ballabgarh, Haryana and another in Aurangabad, Maharashtra. The company has about 976 employees. The companys customers include Eicher, Escorts, Ford India, Maruti Suzuki, Punjab Tractors, TAFE and Tata Motors. In addition to the domestic market, the company exports tyres to Australia, Bangladesh, Germany, Guatemala, Kenya, Morocco, New Zealand, Pakistan, Saudi Arabia, Sri Lanka, and United Arab Emirates.
Tel: +91 11 4747 2727 Fax: +91 11 4747 2715 Internet: http://www.goodyear.co.in Senior Officers
Pierre Eric Cohade, Chairman, President, Goodyear Tyre & Rubber, Asia-Pacific Rajeev Anand, Vice- Chairman and Managing Director Yashwant Singh Yadav, Executive Director Jean Philippe Lecerf, CFO and Executive Director JS Gujral, Vice President, Farm and Commercial Business Rajiv Lochan Jain, Director Brad Lakhia, Alternate Director
Products
Tyres, tubes and rubber products
Plants
India (2): Haryana, Maharashtra
Recent Developments
Corporate strategy Goodyear is primarily focusing on passenger vehicle and farm tractor segments in India. The company is expanding its product line in these two segments which have been recording strong growth over past few years. In February 2011, Goodyear India introduced the Assured Fuel Max tyre for passenger vehicles which delivers a 4% higher fuel efficiency and 15% higher mileage than conventional tyre technology. The tyre would be used for Fiat Punto and Linea, Volkswagen Polo, Honda Accord and Toyota Camry. In the tractor segment, the company launched Vajra Super tyre to cater to the agricultural sector. The tyre sports abrasion resistant features protect it from onfield wear and tear and punctures. The company was a pioneer in introducing tubeless radial tyre technology in passenger car segment in India. Goodyear is working to expand its radial tyre presence to the commercial vehicle segment. The company is developing the manufacturing capabilities to enter the large truck and bus radial (TBR) tyres market and is testing out its global range for Indian road conditions tyres, after which they will be launched in 2011. In April 2011, Goodyear India entered into a strategic alliance with Bharat Petroleum Corporation (BPCL) to introduce branded retail Goodyear Wheelcare outlets at select BPCL petrol pumps across India. Goodyear will be offering discounts on services like wheel alignment & balancing to the customers visiting these outlets as an inaugural offer. The company aims to offer its customers a full spectrum of car and tyre related services under one roof. Investments In March 2006, Goodyear India invested INR 800m (USD17.9m, 28 March 2006) in its Aurangabad facility in Maharashtra. This investment increased its annual capacity by 25% to 1.8m tyres units. In 2004, Goodyear India received funds from parent Goodyear Tyre &
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Sales
INR15.1bn (USD277.6m, 31 December 2011) (Year to 31.12.11)
Employees
c. Group: 976 (2010)
Rubber Company (USA) which were extended as External Commercial Borrowings (ECBs). The funds were used to repay high cost working capital loans from banks. This led to a reduction in interest cost. Contracts Goodyear India supplies radial tyres for passenger cars to Maruti Suzuki. Goodyear India supplies tyres to many leading auto brands in India such as Hyundai i10, i20, Ascent and Santro Xing; GM Chevrolet Aveo U-VA, Maruti Suzuki Wagon R, Estilo, Swift and SX4; Ford Fiesta and Figo; Honda Civic, Skoda Octavia and Toyota Corolla. Goodyear India has the contract to supply cross-ply tyres for commercial vehicles to Tata Motors. Goodyear imports tyres to fulfil Tata's contract.
Certification Goodyear India is accredited with ISO/TS 16949:2002 certification.
New Product Developments

In February 2011, Goodyear launched its latest tyre Assurance Fuel Max in India with fuel saving technology that provides a 4% more fuel efficiency and 15% higher mileage than conventional tyre technology. The company is presently supplying the tyres to Fiat Punto and Linea, Volkswagen Polo, Honda Accord and Toyota Camry. In December 2009, Goodyear introduced the farm tyre, Vajra Super, to cater to the agricultural sector. The product was mainly aimed at south and west India. The tyre has been loaded with abrasion resistant features to protect it from on-field wear and tear and punctures. In April 2009, Goodyear announced the launch of its new tyre 'DuraPlus' for the passenger vehicle segment in the domestic market. The tyre features an advanced carbon-based tread compound to offer higher resistance to frictional wear, further contributing to long tread life and increased mileage. It also provides improved fuel efficiency, precise handling and increased comfort. The tyres will be available in different sizes for popular vehicles like Hyundai Santro Xing, i10 and Accent; Maruti Suzuki Wagon R VXI, Zen Estellio VXI; and GM UV-A. The company also launched the commercial tyres Timber King, CTD 21, and Duraco Hi-Miler in 2009. In 2008, Goodyear launched Goodyear Assurance, a passenger tyre made with Dupont KEVLAR. In October 2006, Goodyear launched the Excellence series a new collection of l luxury passenger car tyres designed with the ultimate 3 Zone Technology and ECO-Sil Silica Tread Compound' Technology
Financial Overview In the financial year ended 31 December 2011 Goodyear

India reported a 16.7% increase in net sales to INR15.1bn (USD277.6m, 31 December 2011) compared with INR13bn (USD284.8m, 31 December 2010) in the previous year. Despite strong growth in sales, the company witnessed decline in earnings during the financial year amid still-high raw materials prices and increase in other expenses such as wages. The company reported profit before tax of INR962.4m (USD17.5m) compared with INR1.1bn (USD24.3m) in 2010. Goodyear India concluded the financial year with net profit of INR645.9m (USD11.8m) compared with INR748.1m (USD16.4m) in the previous fiscal. Year 2011
2010 2009 2008 2007
Sales (INRm) 15,134.3

13,143.3 10,199.7 9,326.7 9,002.7
Profit Before Tax (INRm) 962.4

1,109.2 1,114.1 523.1 647.5
Net Profit (INRm) 645.9

748.1 730.9 321.9 402.3
Year 2011
2010 2009 2008 2007
Sales (USDm) 277.6

288.5 217.5 187.6 228.3
Profit Before Tax (USDm) 17.5

24.3 23.8 10.5 16.4
Net Profit (USDm) 11.8

16.4 15.6 6.5 10.2
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Outlook Goodyear India expects its two targeted market segment passenger vehicles and tractors to record strong growth in coming years. Although passenger vehicle sales moderated in 2011 after two years of strong growth, this is widely believed to be a short term rough phase and the industry is projected to record strong growth in the medium to long term. According to estimates by the Society of Indian Automobile Manufacturers (SIAM), the passenger vehicle sales in India are projected to reach nine million units by 2020 compared with around three million units in 2010.
In the tractor segment the company expects growth to be driven by higher level of agricultural modernisation, increased usage of tractors for non-farm applications and rapid pace of infrastructure development. Persistently high costs of raw materials remain a concern for all tyre manufacturing across the world and Goodyear India is no exception. Like other tyremakers the company has tried to respond to this through rising unit sales price of tyre. However there is a limit to that as well. Goodyear is dealing with rising raw material prices by introducing innovative products and expanding its customer base. Low cost imported products are also a challenge and the company is focusing on bringing the best technology to its customers in order to counter this threat.
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Guru Nanak Auto

Transmission components
Address
Guru Nanak Auto Enterprises Ltd. GT Road Jamalpur Punjab-144 635 Tel: +91-1826-270111/262301 Fax: +91-1826-270003/262306 Internet: http://www.gnaent.com
Guru Nanak Auto (GNA) Enterprises is a major supplier of forging and machining auto components for transmissions of commercial vehicles and sports utility vehicles. The company supplies its products mainly to Europe and North America.
Established in 1946, GNA manufactures brakes, cam shafts, clutch shafts, drive shafts, half shafts, hollow spindles, kingpins, output shafts, planet carrier, rear axle shafts, track bars, torsion bars, WB spindles, yoke shafts. Additionally, the company serves other industries such as railways, aerospace, oil & power, defense and marine. The company supplies its products to OEMs and components suppliers such as Tata Motors, ArvinMeritor, Ford, Maruti Suzuki, Eicher Motors Ltd, Swaraj Mazda Ltd, Toyota Kirloskar Auto Parts, Mahindra & Mahindra, Spicer India Ltd, Automotive Axles, International Cars & Motors and MLR Motors. Corporate strategy The company has increased its production capacity for technology-intensive small or stub components with the installation of new equipment at its facilities. In 2008, the company established a production facility in Chakan, Pune (India) to expand its domestic operations. GNA plans to pursue inorganic growth to expand its geographical presence and customer base. Investments In November 2007, GNA announced plans to set up a 16,000ft2 rear axle shafts unit at Chakan, Pune (India). The plant was established in 2008. Infrastructure GNA operates three manufacturing facilities in India. Of these, two (Bundala and Jamalpur) are in Punjab and one (Pune) is in Maharashtra. The company has a total installed forging capacity of five million components annually. GNA employs a cold extrusion route to manufacture rear axle shafts. The cold extrusion comes with Online Stress Alligner and in-house seven tank surface treatment for easy flow of material. Currently, the company has two presses of 250 and 350 tonnes which are capable of delivering 1.2 million components a year. The Bundala plant covers an area of 75,000m2, Jamalpur plant is spread across an area of 20,000m2 while the Pune facility is built on an area of 22,000m2. The company has developed 470 types of rear axle shafts ranging from 3-50 kilograms since its inception. Certification GNAs manufacturing units have been accredited by Underwriters Laboratories Inc. (UL), Melville, NY, USA, which has certified the company's facilities for QS 9000 & ISO 9002. Testing & validation GNAs design centres are equipped with CAD/CAM software coupled with state-of-the-art tool room and testing facilities. With short development cycles and high-quote-to-order ration, the company ensures fast turnaround on cost estimates.
Senior Officers
Jagdish Singh, Chairman & Managing Director Gurinder Singh, CEO & Joint Managing Director
Recent Developments
Products
Brakes, cam shafts, clutch shafts, drive shafts, half shafts, hollow spindles, kingpins, output shafts, planet carrier, rear axle shafts, track bars, torsion bars, WB spindles, yoke shafts
Plants
Bundala, Jamalpur, Pune
Sales USD55m (est. 2011) Employees

1,050
Financial Overview The company is private and is not obliged to furnish financial information. However, GKN is expected to have sales of about USD55m in 2011. Outlook According to Automotive Components Manufacturers of India,
Indias exports of transmission and steering components together are expected to be between USD26m and USD29m by 2020. This offers a significant opportunity to GNK and presents a positive outlook for the company. GKN would be able to tap a substantial share of the amount as it is one of the largest
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exporters of auto components from India to developed markets across the globe. Moreover, the company will also capitalise on the growing domestic market where it supplies to both domestic and international OEMs.
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Halonix
Lamps
Address Halonix Ltd 59-A, Noida Special Economic Zone Phase-II Gautam Budh Nagar, Noida Uttar Pradesh 201 305 India Tel: + 91 120 401 2222 Fax: + 91 120 256 2943 Website: http://www.halonix.co.in Senior Officers Raj Krishan Sahgal, Chairman Rajesh Kochhar, Managing Director Sanjeev Kashyap, CFO, Company Secretary Rakesh Zutshi, Director, Sales & Marketing Susanta Kumar Niogi, Executive Director Manish Chaturvedi, General Manager Marketing Products Halogen lamps Plants India (5): Uttar Pradesh (3), Uttarakhand(2) Sales INR4.2bn (USD91.5m, 31 March 2011) (Year to 31.03.11) Employees 2,470 (March 2011 )
Halonix is a major supplier of halogen lamps to the automotive industry. The company also manufactures halogen lamps for general lighting purpose.
Halonix, formerly known as Pheonix Lamps, was incorporated in 1991 as a joint sector company with Pradeshiya Industrial & Investment Corporation of UP Ltd (PICUP), a state government financial organisation in technical and financial collaboration with Japan-based Phoenix Electric Co. Ltd (PEC) and Soei Tusho Co. Ltd (SOEI). In 2006, UK based private equity firm Actis acquired a 65% stake in the company from founding promoter family. Two years later, the company was renamed Halonix. The company broadly organises its operations into two business units: Automotive Business and General Lighting Business. Overall Halonix has four products lines: general lighting, luminaires, light emitting diode (LED) application and automotive. The general lighting products include compact fluorescent lamps, fluorescent lamps, high-intensity discharge lamps, halogen lamps and incandescent bulbs. Luminaires products includes indoor and outdoor lighting and caters to residential, retail, industrial projects, hospitality sector, public lighting and government tenders. The companys LED application products include home lighting systems, street lighting systems and Alnitak. Halonixs Automotive product range includes H4 and HS1and H6M (M5), H8/H9/H11 and 9000 Series lamps. The company provides halogen lamps for two- and three-wheelers, passenger cars, commercial vehicles and off-road vehicles. The company offers standard lamps, xenon blue, all-season, dark blue and blue white lamps. Halonix operates five plants in India of which three are located in Noida, Uttar Pradesh and one each in Dehradun and Haridwar, both in Uttarakhand. As of 31 March 2011, the company had 2,470 employees. In the domestic market Halonix supplies to Bajaj Auto, Force Motors, GM, Hyundai, Mahindra & Mahindra, Maruti Suzuki, TVS Motors, Tata Motors and Volvo. In addition, the company supplies to tier one suppliers including Hella, Lucas TVS, Lumax, Minda and Neolite. In addition, Halonix exports its products to more than 75 countries including Australia, Japan, China, Middle East, South-East Asia and Europe. Europe is the largest export destination for Halonix, with the strongest demand coming from Germany. Recent Development Corporate strategy Halonix has focused on establishing itself as a leading supplier of halogen lamps despite facing some challenges related to newer technologies. However, with improved demand for higher-end products and easier access to production technologies, the company commenced manufacturing operations for high-intensity discharge (HID) lamps in 2008. The company also commenced tail lamp manufacturing business in 2009. The company, which primarily focuses on the automotive lighting business, witnessed a surge in the demand for halogen bulbs in financial year 2011. Though the sales of the automotive business were up 13.3% during the financial year, the company faced the capacity shortage of halogen lamps which impacted its supplies to its customers. Halonix is taking the necessary initiative to ensure steady supply of components and started three new production lines in 2010. Halonix has developed a strong presence in the automotive business in international markets including Latin America and the Middle East. The company has also garnered significant sales from European and North American aftermarkets by supplying replacement headlamps, as demand for these surged due to the enforcement of international Day Light Running
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norms a few years ago. The company is now keen on expanding its presence in the US and China. For the US region, Halonix plans to expand production of 9,000 series halogen bulbs in the country. Further, the company plans to raise the headlamps capacity from 60 million units per annum in FY 2011 by around 25 million units a year by 2013. The move will support its growth strategy for exports in Europe which constitutes an important market for the company. In India, the company had a 70% market share of domestic OEMs in 2010. The lamps produced in India are approved by Automotive Research Association of India (ARAI). The growing penetration of the foreign automakers is further opening new doors for the company. For instance, Renault-France has approved the companys product line for its India project. The company has also secured contracts from three OEMs based out of Europe of which it has not disclosed the identity. Joint-ventures Halonix India has a technical and financial tie-up with Japan-based Phoenix Electric Co. Ltd (PEC) and Soei Tusho Co. Ltd (SOEI). Contracts Halonix has the contract to supply headlamps for the Tata Nano. Halonix supplies H8 LED lamps for the Maruti Suzuki Swift and Swift Dzire models. Certifications Halonix has been accredited with ISO 9001:2000, TS 16949:2002, ISO 14001:2004 and OHSAS:18001 status. New Product Developments Halonix added new automotive products named H13, Long Life, Night Vision and Xtra Performance to its portfolio. Financial Overview In the financial year ended 31 March 2011 Halonix reported a 4.1% decline in consolidated net sales of INR4.2bn (USD91.5m, 31 March 2011) compared with INR4.4bn (USD95.8m, 31 March 2010) in 2010. Of the total sales, the company generated INR3bn (USD66.1m) from the domestic market, while the remaining INR1.2bn (USD26.4m) came from outside India. The decline in sales led Halonix to incur loss during the financial year, though considerably less than the previous financial year. The company reported loss before tax of INR113.5m (USD2.5m) compared with loss of INR200.1m (USD4.4m) in 2010. Halonix also reduced net loss during the financial year to INR101.1m (USD2.2m) over INR199.8m (USD4.4m) in the previous financial year. Halonixs sales in Automotive Business increased 13.3% to INR2.5bn (USD55.1m) compared with INR2.2bn (USD48.9m) in the previous financial year. The business unit reported earnings before interest, depreciation and taxes (EBDIT) of INR530.4m (USD11.8m), up 7.4% compared with INR493.9m (USD10.9m) for the same period in the corresponding year. However, the companys sales in General Lighting Business fell 12.8% to INR2.2bn (USD49.5m) compared with INR2.6bn (USD57.7m) in 2010. Despite decline in sales the business unit reduced loss before interest, depreciation and taxes from INR216.4m to INR203.3m. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 Net Sales (INRm) 4,187.8 4,369.4 3,840.6 3,566.5 2,778.3 Net Sales (USDm) 92.2 95.8 73.6 Profit Before Tax (INRm) (113.5) (200.1) 32.2 519.3 290.4 Profit Before Tax (USDm) (2.5) (4.4) 0.6 Net Profit (INRm) (101.1) (199.8) 16.3 480 314.7 Net Profit (USDm) (2.2) (4.4) 0.3
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2008 2007
89.4 64.0
13.0 6.7
12.0 7.2
Outlook Halonix continues to remain under pressure as reflected in its financial performance. At a time when most of the Indian suppliers gained from increased demand and reported strong improvement both in top and bottom line in 2011, the company reported marginal decline in sales, though it significantly cut its loss compared with a year ago. As it appears, the company is yet to recover fully from the economic slowdown of 2008 and 2009. Demand for automotive lamps is tied to the new vehicle sales and aftermarket consumption. While new registrations are growing at a slower than anticipated rate in the financial year 2012, demand from the aftermarket has remained steady. Halonix expects to win business from new automakers that are entering the Indian automotive market. Further its exports to the aftermarket in North America and Europe are expected to remain steady. Halonix has started capacity expansion plans in order to meet the increasing demand from its current customers. The company also commercialised three new production lines in 2010 which will help it further expand its business with new customers.
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Harita Seating
Seats
Harita Seating is a major supplier of seating systems to a wide range of vehicles. The company provides seating solutions to the two-wheelers, three-wheelers, passenger cars and commercial vehicles. The company also supplies to off-the-road vehicles.
Harita Seating Systems was established in 1986 as a joint-venture, Harita Grammer Limited, between the TVS Group and Germany-based Grammer AG. In 1997, operations of Roloforms Polymer were merged with Harita Grammer Ltd. When Grammer faced poor economic conditions, the TVS Group bought out its share in the venture in 2002. Following the acquisition of Grammers stake, the companys name was changed from Harita Grammer to Harita Seating Systems. The company operates five plants in India which are located in Chennai and Hosur, Tamil Nadu; Pune, Maharashtra; Solan, Himachal Pradesh and Bengalore, Karnataka. Harita supplies to both automakers and tier one suppliers. The companys OEM customers include Ashok Leyland, Eicher, Ford, Hyundai, Mahindra &Mahindra, Tata Motors, Toyota Kirloskar and Volvo. Haritas customers among tier one suppliers include Lear, Tata Johnson Control and Toyota Boshoku. Recent developments Corporate strategy Harita Seating has benefited from the overall buoyant demand for vehicles in India over the past ten years. The company has expanded its presence in the bus and tractor markets. While initial technology came from Grammer, Harita Seating has developed its own research and development (R&D) capability. The company has its own R&D centre which has helped it reduce lead time to develop and launch new products in the automotive market. Harita Seating has initiated design and development of both heavy and light duty truck seats for commercial vehicles. The company has developed mechanical suspended driver seats for commercial vehicles. The company is now focusing on development of high-end seats for commercial vehicles. In addition, the company is concentrating on development of seating systems for commercial vehicles and tractors to improve safety and comfort level of drivers. Like many other suppliers, Harita Seatings margin has come under pressure amid sharp increase in prices of raw materials such as such as steel, foam, plastics, vinyl and rexines. While the company has been able to settle commodity related price increase with the majority of customers, it is continuing negotiations with the remaining customers. Acquisitions In October 2008, Harita Seating acquired Polyflex, a manufacturer of cold cure moulded polyurethane foam. The acquisition includes Polyflexs plants in Chennai, Tamil Nadu and Bangalore, Karnataka, the movable assets of Polyflexs plan in Pune, Maharashtra and its fabrication unit, Polyflex Engineering. The engineering division is engaged in manufacturing and supplying automotive seat frames. The financial details of the deal were not disclosed by either company. Joint-ventures In August 2008, Harita Seating formed a joint-venture (JV) with F S Fehrer Automotive in India to manufacture polyurethane moulded foam pads for seats and plastic components for the Indian automotive market. The new company named Harita-Fehrer Ltd is based in Chennai and became operational 2008. The JV produces complete vehicle seats for commercial vehicles and buses. Harita Seating owns 51% in the JV, while the remaining 49% lies with Fehrer. The company has transfered its twoAddress Harita Seating Systems Ltd Jayalakshmi Estates, 5th Floor No. 29 (Old No.8), Haddows Road Chennai 600006 Tamil Nadu India Tel: + 91 44 2827 2233 Fax: + 91 44 2825 7121 Website: http://www.haritaseating.com Senior Officers H Lakshmanan, Chairman A G Giridharan, President V Thiagarajan, General Manager- Finance Products Seats, bus interior trims Plants India (5): Himachal Pradesh, Karnataka, Maharashtra, Tamil Nadu (2) Sales INR2.25bn (USD49.6m, 31 March 2011) (Year to 31.03.11)
Employees
Total: 334 (31 March 2011)
264
wheeler seats and foaming business to Harita-Fehrer. Investments In 2006, Harita Seating Systems commenced production of seats for OEMs and other clients at a greenfield facility at Nalagarh, Himachal Pradesh. Also in 2006, Harita Seating Systems added bus interior and trim production line at its Hosur plant in Tamil Nadu. Certifications Harita Seating Systems is accredited with ISO 14001-2004 status. New Product Developments Harita Seating spent INR35.1m (USD0.8m, 31 March 2011) on research and development (R&D) in the financial year ended 31 March 2011. This was equivalent to 1.5% of the company sales in the financial year. During the year, the company developed some new products including seats for heavy and light duty commercial vehicles and mechanical suspended driver seats for commercial vehicles. Further, the company is focusing on the development of seating systems for commercial vehicles to improve safety and comfort level of drivers and to develop high-end seats for commercial vehicles. Financial Overview In the financial year ended 31 March 2011 Harita Seating Systems reported a marginal increase in net sales to INR2.25bn (USD49.6m, 31 March 2011) compared with INR2.23bn (USD49.6, 31 March 2010) a year ago. The company recorded a sharp increase of 92% in exports to INR214.7m (USD4.7m) compared with the previous financial year. The companys performance came under pressure due to a 9% increase in expense on raw materials during the year to INR180.4m (USD39.7m). Harita Seating suffered a sharp increase in loss before tax to INR58.4m (USD58.4m) over loss of INR10m (USD22, 207) in the previous financial year. The company concluded the financial year with net loss of INR51.0m (USD1.1m), against a net profit of INR881,000 (USD19,564.7) in the preceding year. The company suffered loss during the financial year due to lack of adequate capacity in the vendor base, causing unprecedented air freight to export customers based in the US. Poor vendor capacity also impacted the companys component delivery to domestic customers leading to penalties. The situation was further worsened by a steep hike in prices of raw materials such as steel, foam, plastics, vinyl rexines which could not be transferred to the customers. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Sales (INRm) 2,250.4 2,235.6 1,962.5 1,910.5 1,554.7 Sales (USDm) 49.6 49.6 37.6 47.9 35.8 Operating Profit (INRm) 14.8 60.4 (36.6) 123.9 97.7 Operating Profit (USDm) 0.3 1.3 (0.7) 3.1 2.2 Profit Before Tax (INRm) (58.4) (10.0) (79.1) 95.3 90.1 Profit Before Tax (USDm) 1.3 (0.2) (1.5) 2.4 2.1 Net Profit (INRm) 51.0 0.9 (89.2) 64.1 58.3 Net Profit (USDm) 1.1 0.01 (1.7) 1.6 1.3
Outlook Harita Seating has enjoyed a strong market presence in the seating systems business of commercial vehicles and tractors. This segment of the automotive industry is recording strong growth in demand following the global economic slowdown. The growth momentum is expected to continue in India as the government reinforces its focus on the development of infrastructure. As a major seating systems supplier of commercial vehicles and tractor segment, Harita Seating is well positioned to grow in coming years.
265
Hi-Tech Gears
Gears and transmission components
Address
Hi-Tech Gears Limited 14th Floor, Tower - B Unitechs Millennium Plaza Sushant Lok-I, Sector - 27 Gurgaon Haryana India
Hi-Tech Gears is one of the major suppliers of engine and transmission components in India. The company also makes precision forging and power transfer unit (PTU) shafts for the automotive industry. In addition to automotive, the company has interests in engineering, software and robotics.
Hi-Tech Gears was founded in 1986 as a single source supplier to former Hero Honda, now Hero MotoCorp. The company began operations two years later. Currently, Hi-Tech operates three manufacturing plants in India, of which two are located in Bhiwadi in Alwar, Rajasthan and one in Manesar, Gurgaon, Haryana. In March 2011 the company had 1,600 employees. The company has annual capacity to produce 4.5 million precision forgings and machining, 1.5 million timing gears, 0.5 million transmission gears and shafts, and 0.3 million PTUs. In addition Hi-Tech Gears has annual capacity to produce 18 million transmission gears and shafts for motorcycles and scooters. The company has had a technical tie-up with Kyushu Musashi since 1992. Four years later, Hi-tech Gears entered into another strategic alliance with Getrag Corporation which was converted into a 50:50 joint-venture (JV) in 2004 called Getrag Hi-Tech Gears. Hi-Techs major customers include two-wheelers, passenger cars and commercial vehicles manufacturers. The company supplies its products to Ashok Leyland, Bosch, Caterpillar, Cummins, Daimler, Eicher, Fiat, Ford, Getrag, Cummins, Hero Honda, Hindustan Motors, Honda Scooter & Motorcycle India, Honda Siel Cars, Mahindra & Mahindra, Maruti Suzuki, Meritor, New Holland, Royal Enfield, TAFE, Tata, TVS, Volvo and Yamaha Motors. The company exports about 22% of its sales from exports.
Tel: + 91 124 4715 100 Fax: + 91 124 2806085/ 89 Internet: http://www.hitechgears.com Senior Officers
Deep Kapuria, Chairman Pranav Kapuria, Managing Director Anuj Kapuria, Executive Director Vijay Mathur, General Manager, Finance
Products
Engine sprockets, power take-off unit for offhighway vehicles, precision forgings & precision machine parts, timing gears, transmission gears & shafts, wheel hub, wheel spindles
Plants
India (3): Haryana, Rajasthan (2)
Recent Developments
Corporate strategy Hi-tech Gears will continue to focus on the growing Indian automotive market and exports. Given high medium- to long-term growth potentials of the domestic market, the company invested in a new manufacturing plant near its existing plant in Bhiwadi, Rajasthan (India). The new plant became operational in 2011. The company is also concentrating on expanding its customer base. Hi-Tech Gears is negotiating with several new customers. In addition, the company is focusing on expanding its international presence. Hi-Tech Gears has secured new business in UK and Brazil. The company has also reported significant increase in exports to the US. In addition, the company continues to focus on technological changes to keep abreast of various developments and be responsive to customer and market requirement. Hi-Tech has acquired newer gear finishing technologies. In addition, the company is investing in better inspection and testing infrastructure to improve product quality. Investments In August 2010, Hi-Tech announced that is setting up another facility in Bhiwadi in Rajasthan with an investment of INR500m (USD10.73m, 12 August 2010). The company has already spent 50% of the planned amount and will spend the rest by before end-2011. The plant became operational in 2011. In 2005, Hi-Tech invested approximately INR 450m (USD10.28m, 31 March 2005) in its new plant in Manesar, Haryana (India). The plant produces timing gears and export requirements.
Sales
Employees
c. 1600 (March 2011)
266
Certifications In January 2010, Hi-Techs Manesar plant in Haryana won The Shingo Silver Medallion award. In January 2010, Hi-Tech Gears Group and its plant in Bhiwadi, Rajasthan and Manesar, Haryana (both in India) won the Japan Institute of Plant Maintenance certificate for Total Productive Maintenance (TPM) Excellence. Hi-Tech has been accredited with TS 16949, OHSAS 18001, ISO 14000 and ISO 9001 certificates.
Financial Overview In the financial year ended 31 March 2011, Hi-Tech

Gears recorded net sales of INR4.2bn (USD93.6m, 31 March 2011), an increase of nearly 31.7% compared to INR3.2bn (USD71.7m, 31 March 2010) in 2010. Higher sales of the company were driven by strong performance in both the domestic market and exports.
The company reported a sharp increase of 84% in exports to INR900.3m (USD19.8m) compared with INR488.9m (USD10.9m) in the previous financial year. The strong growth in exports was driven by increased international presence in key overseas markets in the US, Europe and Latin America. The company reported a 68.1% increase in profit before interest and tax of INR602.9m (USD13.3m) compared with INR358.6m (USD7.9) in the previous year. Profit before tax increased by almost 95.1% to INR526.7m (USD11.6m, 31 March 2011) from INR269.9m (USD6m, 31 March 2010) the previous year. Net profit for the year increased by 96.3% to INR350.4m (USD7.72m, 31 March 2011) compared to INR178.5m (USD3.96m, 31 March 2010) in 2010. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 4,249.3 3,226.9 2,947.8 2,845.0 2,696.3 Sales (USDm) 93.6 71.7 56.5 71.3 62.1 Operating Profit (INRm) 602.9 358.6 214.8 266.2 225.1 Operating Profit (USDm) 13.3 7.9 4.1 6.7 5.2 Profit Before Tax (INRm) 526.7 269.9 118.8 153.6 134.5 Profit Before Tax (USDm) 11.6 6.0 2.3 3.8 3.1 Net Profit (INRm) 350.4 178.5 76.9 98.2 83.3 Net Profit (USDm) 7.7 3.9 1.5 2.5 1.9
Outlook Hi-Tech Gears has positioned itself in technology demanding areas

such as engine and transmission components. In this segment, the company faces tough competition from the global powertrain component suppliers. However, the companys ability to produce components at reasonable costs in India has helped it to win business from major automakers, not only in the domestic market but also in the overseas markets.
Although sales of passenger vehicles moderated in India in financial year 201112 due to various unfavourable macroeconomic factors such as continuing high inflation, increasing fuel prices and growing cost of financing, the commercial vehicles and two-wheeler segment continues to do well. The company is witnessing an increase in demand for transmission components in the commercial vehicles. Being one of the major players in the transmission component segment in India, Hi-Tech is well positioned to grow. Hi-Tech Gears new upcoming plant in Bhiwadi will produce transmission component for both passenger cars and commercial vehicles.
267
Imperial Auto
Fluid transmission products
Imperial Auto is one of the leading suppliers of fluid transmission products in India. The company manufactures rubber hoses and assemblies, and metal tube assemblies for twowheelers, three-wheelers, passenger cars, commercial vehicles and off-the-road (OTR) vehicles. In addition, the company supplies its products to major tier one engine manufacturers.
Imperial Auto was established in 1969 to manufacture low-pressure fuel hose assemblies. One year later, the company commenced supplying to local automakers operating that time including Fiat, Hindustan Motors, Kirloskar, Mahindra & Mahindra and Tata Motors. Presently, the company operates more than 22 manufacturing plants across India. The companys plants are located in Faridabad, Haryana; Sanand, Gujarat; Bangalore, Karnataka; Talegaon, Maharashtra; Pithampur, Madhya Pradesh; Lucknow, Uttar Pradesh and Rudrapur, Uttarakhand. The company employs 3,000 people. Imperial Auto supplies its products to both automakers and tier one suppliers. Among automakers, the companys major customers are AMW, Ashok Leyland, Bajaj Auto, Caterpillar, Fiat, GM, Hero MotoCorp, Hyundai, JCB, John Deere, Mahindra & Mahindra, New Holland, Nissan, Piggiao, SML Isuzu, TAFE, Tata Motors and Toyota. Among tier one suppliers, the companys major customers include Bosch, Caterpillar, Cummins, Delphi TVS, Kirloskar, Suzuki Powertrain and Tata Cummins. In addition, Imperial Auto exports its products to automakers and suppliers in several overseas markets. Among automakers the company supplies to GM in Australia, Germany, Poland, South Korea, Spain, Thailand, the UK and the US; Piaggio in Italy and Triumph Motorcycles in Thailand and the UK. The company also supplies to engine suppliers such as Caterpillar in the US; Cummins in Brazil, China, Mexico, the UK and the US; Fiat Powertrain in Brazil, John Deere in France and the US and Navistar in Canada, Mexico and the USA. Recent Developments Corporate Strategy: Imperial Auto has been focusing on expanding its product offering through entering into strategic joint-ventures with several international component suppliers. In September 2010, the company formed a JV with Italybased Allevard Rejna Autosuspensions, a company owned by Sogefi Group, to produce stabilised bars and torsion bars for passenger cars and utility vehicles. The company also has JV agreements with Italy-based Martor and Japan-based Tokai Rubber which have helped to expand product offerings of engine components and automotive hoses. The company continues to expand its capacities to meet increased demand from its customers. In March 2011, Imperial Auto set up its fourth manufacturing plant in Chakan, near Pune, Maharashtra (India), in which it invested INR250m (USD5.5m). The plant will produce fluid transmission products and will primarily supply to Mahindra & Mahindra. Joint-Venture In September 2010, Imperial Auto entered into a joint-venture agreement with Italy-based Allevard Rejna Autosuspensions, a part of Sogefi group. The Italian partner has a majority stake of 51% in the JV, Allevard IAI Suspensions Private Limited while the balance 49% is owned by the Indian partner. The JV will invest INR250m (USD5.6m) to set up a new manufacturing plant in Pune, Maharashtra (India). The JV will initially manufacture stabiliser and torsion bars for passenger cars and utility vehicles. Address Imperial Auto Industries Limited Opposite Railways Goods Shed Faridabad-121001 Haryana India Tel: +91 129 2412321/2423791 Fax: +91 129 241216 Internet: http://www.impauto.com/ Senior Officers Jajit Singh, Chairman Products Flexible hose assembly, metal tube assembly, rubber hose assembly Plants India (22): Gujarat, Haryana, Karnataka, Maharashtra, Madhya Pradesh, Uttar Pradesh, Uttarakhand Sales INR7bn (USD155m, 31 March 2011) (Year to 31.03.11) Employees 3,000 (March 2011)
268
In 2008, Imperial Auto formed a joint-venture with Italy-based Martor S.p.A. to produce engine components for European OEMs operating in India. The JV, Imperial Martor Engine Tubes Private Limited, operates a manufacturing plant in Chakan, near Pune, Maharashtra (India). In November 2005, Imperial Auto entered into a joint-venture agreement with Japans Tokai Rubber to produce various automotive hoses for Japanese automakers operating in India. The JV, Tokai Imperial Rubber India Private Limited, is 60% owned by Tokai Rubber and 40% by Imperial Auto. The JV operates a manufacturing plant in Faridabad, Haryana (India).
Investment In March 2011, Imperial Auto established a manufacturing plant in Chakan, near Pune, Maharashtra (India). The company invested INR250m (USD5.5m, 31 March 2011) in the new manufacturing plant which is its fourth in Pune region. The plant will produce fluid transmission products will primarily supply to Mahindra & Mahindra. Certificates Imperial Auto plants are certified with ISO/TS16949:2009 and ISO 14001:2004 accreditations. Financial Overview For the financial year ending 31 March 2011, Imperial Auto was expecting sales of INR7bn (USD155m). The company is a privatelyowned and therefore it does not publish details of financial results. Outlook From a moderate start over four decades ago, Imperial Auto has emerged as leading supplier of fluid transmission products in India. The company not only supplies to several leading automakers and suppliers operating in India but also caters to some international automakers and engine manufacturers in the global market. As a leading supplier of fluid transmission products, Imperial Auto is well positioned to benefit from the strong growth of the India automotive industry.
269
IP Rings
Piston rings
IP Rings is a major supplier of piston rings, differential gears, pole wheels and other transmission components for the automotive industry. The company also makes nodular and grey cast iron rings. The company is owned by the Amalgamations Group.
IP Rings was formed in 1991 as a technical collaboration between India Pistons Limited, a company of the Amalgamation Group and Japan-based Nippon Piston Ring. The company is promoted by India Pistons, Simpson & Company, Tractor and Farm Equipment (TAFE) and the Amalgamation Group. The company manufactures steel and cast iron rings for pistons, with an installed capacity of 10 million piston rings per annum. IP Rings is among the few suppliers in India to manufacture Niflex-S type rings. The company supplies around 60% of its production to OEM customers and the remainder for the aftermarket. For the aftermarket, IP uses the distribution network of its sister concern, India Pistons. IP Rings operates only one plant in India which is located at Maraimalainagar, near Chennai in Tamil Nadu. The companys products are used in two-wheelers, three-wheelers, passenger cars, commercial vehicles, tractors, compressors and industrial engines. IP supplies to most of the automakers operating in India including Ashok Leyland, Eicher Motors, Hindustan Motors, Hyundai Motor India, Mahindra & Mahindra, Maruti Suzuki, Royal Enfield, TAFE, Tata Motors and TVS Motor. Recent developments Corporate strategy IP Rings is expanding its product line keeping in mind the long-term growth prospects of the Indian automotive industry. In collaboration with Nippon Piston Rings, the company is working on a new surface coating technology, called the Physical Vapour Deposition (PVD) to make steel rings for engines to enhance its performance. The company believes that the technology has been developed in advance as it expects demand for this to increase in the near future. IP Rings has already invested INR250m (USD5.5m, 31 March 2011) to set up a fcaility for PVD whose production is expected to start by 2012. In addition, IP Rins is concentrating on developing diamond coatings process for rings which helps to meet emission norms and increase engines performance. The company expects the process to be commercialised in 2011. IP Rings believes that the new diamond process would double the ring life when compared with chrome-plated rings. The company is targeting Ashok Leyland and Tata Motors for its diamond coating process technology. Like most of the suppliers operating in India, IP Rings is witnessing a sharp increase in prices of raw material over a year. This, combined with rising borrowing costs, power shortage and customers resistance to price revision, is impacting the companys margin. IP Rings is taking initiatives in the area of value engineering and is implementing cost-reduction measures to reduce the impact of rise in costs, which is marking a dent on its profitability. Investments In 2010, India Pistons Limited and it's associate companies, IP Rings Ltd and Mahle IPL Ltd, invested INR1.75bn (USD38.4m, 31 December 2010) to expand its process capabilities and introduce new technologies that will enable automakers meet future emission norms. India Piston Rings Ltd is expanding its capacity in a phased manner and it expects to cross the 50 million per year target by mid-2012. Address IP Rings Ltd Arjay Apex Center 24, College Road Chennai 600 006 Tamil Nadu India Tel: +91 44 2824 1887/ 5204 3029 Fax: +91 44 2822 0410 Website: http://www.iprings.com Senior Officers N Venkataramani, Chairman A Venkataramani, Managing Director M Govindarajan, Associate Vice-President, Operations S Rangarajan, Associate Vice-President, Finance & Secretary N Gowrishankar, Whole-time Director N Ramakrishnan, Senior General Manager, Business Planning & Systems S Meiyappan, Senior General Manager, Sales & Application Engineering Products Bevel gears, differential shaft gears, grey cast iron steel rings, nifflex expander based three piece oil rings, nodular iron steel rings, pinions, special alloy steel rings, synchrocones Plants India: Tamil Nadu Sales INR796.7m (USD17.5m, 31 March 2011) (Year to 31.03.11) Employees c. 220 (2008)
270
Certifications IP has been accredited with QS 9000 and TS 16949 status.
New Products Development IP Rings spent INR56.05m (USD1.2m, 31 March 2011) on research and development (R&D) in financial year 2011 compared with INR56.4m in the previous financial year. The companys R&D expense was equivalent to 0.7% of its total sales on research and development in fiscal 2011. IP Rings has developed following products in recent years: In 2010, IP Rings developed and tested high performance Physical Vapour Deposition (PVD) technology which is used to make steel rings for engines in order to enhance its performance and meet emission norms. The PVD technology improves longevity of the rings which can work for up to a million kilometers. In 2010, the company developed Dia Piston Rings for turbo charger applications. In 2005, IP Rings developed chrome plating and other coating techniques to increase ring life and optimise performance with reference to the oil consumption, blow-by and emission legislations.
Financial Overview In the financial year ended 31 March 2011, IP Rings generated sales of INR796.7m (USD17.5m, 31 March 2011) an increase of 17.6% compared with INR678.5m (USD15.1m, 31 March 2010) in 2010. The company benefited from the higher demand in both rings and transmission components business. Despite strong growth in sales the company witnessed decline in earnings compared with the previous financial year. IP Rings reported profit before tax had decreased by 17.3% to INR67.5m (USD1.5m) compared with INR81.6m (USD1.8m) in 2010. The company concluded the financial year with a net profit of INR46.9m (USD1m) a decrease of 15.6% over INR55.6m (USD1.2m) in 2010. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Sales (INRm) 796.7 678.5 484.9 540.1 493.9 Sales (USDm) 17.5 15.1 9.3 13.5 11.4 Profit Before Tax (INRm) 67.5 81.6 16.0 40.2 60.3 Profit Before Tax (USDm) 1.5 1.8 0.3 1.0 1.4 Net Profit (INRm) 46.9 55.6 10.9 25.0 38.9 Net Profit (USDm) 1.0 1.2 0.2 0.6 0.9
Outlook IP Rings enjoys very strong presence in the piston rings market, especially in Southern India, which boasts of automakers such as Hyundai, Ford and Renault-Nissan. The region is witnessing a strong investment by automakers. As a leading supplier in the region, IP Rings is well positioned to grow. The company has already expanded its product portfolio with the inclusion of transmission components and other forged parts for the automotive market. IP Rings has already completed the PVD rings project and it is currently undergoing production and market trials. The company expects a major chunk of sales and earnings to come from this product line. IP Rings initiative to develop products is aimed at meeting stringent emission norms and promises growth for the company in coming years. The company has access to several technologies which help automakers meet emission standards up to Euro IV and above in the market. This is expected to help the company secure new contracts from automakers marking their presence in India.
271
Jamna Auto
Springs, Suspension systems
Address Jamna Auto Industries Limited 1-B, Bhawani Kunj Near Heritage School Opposite Pocket D-1 Vasant Kunj New Delhi-110 070 India Tel: +91 11 3264 8668/98 Fax: +91 11 2689 3192 Internet: http://www.jaispring.com/ Senior Officers Bhupinder Singh Jauhar, Chairman Randeep Singh Jauhar, CEO & Executive Director Pradeep Singh Jauhar, COO & Executive Director Sunil Laroiya, Vice-President, International Business, Suspension, R&D Shakti Goyal, Head, Strategic Sourcing & Finance S P S Kohli, President, Executive Director, & Head, Chennai Plant A K Goyal, Vice President & Head, Malanpur Plant R Muthupalani, Senior General Manager, Head, Jamshedpur Plant R P Singh, General Manager & Head, Yamuna Nagar Plant. R K Upadhayay, Head, Lucknow Plant Products Air suspension, bogie suspension- tandem axle, lift axle- steerable / non steerable, multileaf springs, parabolic springs Plants India (8): Jharkhand, Haryana, Madhya Pradesh, Tamil Nadu (3), Uttar Pradesh, Uttarakhand Sales INR9bn (USD199m, year to 31 March 2011) (Year to 31.03.11) Employees 3,000 (2011) The company has technical partnership with Japans NHK Springs, a global leader in spring manufacturing technology. Jamna Auto also has a technology alliance with US-based Ridewell Corporation in air suspension systems. Jamna Auto operates four manufacturing plants in India located in Jamshedpur, Jharkhand; Yamuna Nagar, Haryana; Malanpur, Madhya Pradesh and Chennai, Tamil Nadu. In addition, Jai Suspension System Limted (JSPL), a wholly-owned subsidiary of Jamna Auto, operates a manufacturing plant at Pant Nagar in Uttarakhand. Besides, Jamna Auto is setting up its sixth plant in Lucknow, Uttar Pradesh and seventh at Hosur, Tamil Nadu (India). The company is also setting up a dedicated plant in Chennai, Tamil Nadu which will produce air suspension systems and lift axles. The company supplies to all major commercial vehicle manufacturers in India. Jaman Autos major customers include AMW, Ashok Leyland, Daimler, Eicher, Force, Ford, GM, Kamaz Vectra, MAN, Mahindra Navistar, Maruti-Suzuki, Renault-Nissan, SML Isuzu, TACO Hendrickson, Tata Motors, Toyota, VE Commercial Vehicles and Volvo. In addition, the company exports GM and UD Trucks, a wholly-owned subsidiary Volvo Trucks in Japan. The company also exports to more than 50 companies in over 25 countries. Recent Developments Corporate strategy Jamna Auto is investing in increasing capacity to meet strong demand for leaf and parabolic springs from its customers. In August 2010, Jamna Auto announced plans to invest INR2bn (USD42.6m, 31 August 2010) to establish new facilities and expand the existing ones. The company plans to enhance its production capacity by over 70% in the next two years in India. Jamna Auto will set up four new facilities and expand the production capacity of its five plants in India including Pune, Maharashtra and Lucknow, Uttar Pradesh In March 2011, the company announced plans to open two plants in Tamil Nadu (India), located at Hosur and Chennai, with an investment of INR800m (USD17.6m, 8 March 2011). The plants will supply parabolic springs and suspension systems to Daimler, Renault-Nissan, Leyland-Nissan and Ashok Leyland. In addition, the company is investing in capacity expansion at its existing facilities in Yamuna Nagar, Haryana and Malanpur, Madhya Pradesh (both in India). After completion of these projects, Jaman Autos production capacities will increase to 240,000MT per year compared with the current 180,000 MT. Jamna Auto is focusing on diversifying its product line, market presence and customer base to reduce its business risks. The company which generates around 90% of its business from spring leafs, is shifting focus to the parabolic leaf, which is becoming more popular among automakers. Parabolic leaf is lightweight and helps automakers to reduce overall weight of vehicle and thus improve fuel economy. Jamna Auto is also diversifying into air suspension systems and lift axles. In 2009, the company entered into a technical alliance with US-based Ridewell Corporation to manufacture air suspension systems in India. Jamna Auto is setting
Jamna Auto is one of the largest manufacturers of tapered leaf springs and parabolic springs for commercial vehicles. In India, the company has the leading market shares of 65% in supply of leaf and parabolic springs. The company also supplies air suspension systems and lift axles for the automotive industry.
Jamna Auto began operations in 1954 in a small shop in Yamuna Nagar, Haryana (India) and over the past 60 years, the company has emerged as the leading supplier of springs in the country. The company manufactures a wide range of springs to meet requirements of light commercial vehicles (LCVs), sport utility vehicles (SUVs), medium and heavy duty commercial vehicles (M&HCVS) and trailers. Jamna Auto is diversifying into air suspension systems for buses and lift axles for trucks.
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up a new plant near its Chennai plant in Tamil Nadu (India) to manufacture air suspension systems. The company expects these initiatives to help it reduce its dependence on leaf springs from 90% to 65% in the next few years. In addition, Jamna Auto is focusing on increasing exports to further reduce its dependence on the Indian OEMs. The company generates 90% of its sales from Indian OEM customers but aims to reduce this to 70% by increasing the share of domestic aftermarket and export to both international OEMs and aftermarket. Jamna Auto intends to increase its exports to the US and Europe. The company is planning to expand its plants in Malanpur, Madhya Pradesh and Chennai, Tamil Nadu (both in India) to cater to the overseas markets. Acquisitions In November 2007, Jamna Auto acquired a leaf-spring manufacturing plant of Tata Motors in Jamshedpur, Jharkhand (India). The company invested about INR650m (USD16.5m, 15 November 2007) to double production capacity of the acquired plant to 60,000 tonnes annually. The plants acquisition increased Jamna Auto's parabolic spring production capacity to 30,000 tonnes from 15,000 tonnes in 2007. The company already operates a manufacturing plant in Jamshedpur. Jamna Auto merged this plant with the acquired plant to gain from economies of scale. The company also entered into a supply agreement with the automaker to continue supplying leaf springs. Joint-venture In December 2008, Jamna Auto entered into a technical assistance agreement with US-based Ridewell Corporation to manufacture air suspension systems and components. Investments In March 2011, Jamna Auto announced plans to open two manufacturing plants, one in Hosur and another in Chennai, both in Tamil Nadu (India) with an investment of INR800m (USD17.6m, 8 March 2011). The Hosur plant will produce parabolic springs, while the Chennai plant will manufacture suspension systems. Both plants will supply components to commercial vehicle manufacturers like Daimler, Renault-Nissan, Leyland-Nissan and Ashok Leyland. In August 2010, Jamna Auto announced plans to invest INR2bn (USD42.6m, 31 August 2010) to set up new facilities and expand the existing ones to enhance its production capacity by over 70% in the next two years in India. The company will set up four new facilities and also expand the production capacity of its five plants in India including Pune, Maharashtra and Lucknow, Uttar Pradesh (India). Additionally, the company will set up an export oriented unit (EOU) in Malanpur, Madhya Pradesh (India) to supply components to the US and European markets. In March 2010, Jamna Auto announced plans to set up a manufacturing facility for air suspension systems and components in partnership with Ridewell Corporation, next to its existing plant in Chennai, Tamil Nadu (India). The company will invest INR200m (USD4.4m, 31 March 2010) in the first phase of the facility construction. Earlier in February 2010, the company announced it would make a total investment of INR350m (USD7.5m, 15 February 2010) in the proposed facility. The facility will manufacture 1,000 suspension systems annually and will attain full capacity in 2012. In October 2008, JAI Suspension System Limited (JSPL), a wholly-owned subsidiary of Jamna Auto, started commercial production of suspension springs at its new facility in Pantnagar, Uttarakhand (India). The facility was established with an investment of INR30m (USD0.6m, 21 October 2008), and supplies components to Tata Motors and Ashok Leyland. The plant has a production capacity of 24,000 MT annually. In February 2008, Jamna Auto announced it would set up a precision commercial vehicle springs facility in Jamshedpur, Jharkhand (India) with an investment of INR750m (USD18.9m, 18 February 2008). Earlier in December 2007, the company announced plans to invest INR1.4bn (USD35.5m, 9 December 2007) to set up two facilities in Jamshedpur and Pantnagar. The company decided to establish these two facilities to double production capacity to 2,00,000 tonnes per annum. Contracts In 2010-11, Jamna Auto started supplying springs to Japan-based UD Trucks a subsidiary of Volvo. In April 2008, Jamna Auto received a contract to supply suspension
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components to Tata Motors World Trucks. Additionally, the company will supply leaf and parabolic springs to Ashok Leyland and its joint-venture with Nissan. In March 2008, Jamna Auto received a contract to supply suspension systems to Asia Motor Works.
New Product Developments Jamna Auto operates an in-house R&D Centre in Malanpur, Madhya Pradesh (India) recognised by Department of Scientific & Industrial Research (DSIR). The company has a technical tie-up with NHK Spring and Ridewell Corporation to develop products. Jamna Auto develops 35 types of leaf and parabolic spring for the automotive industry. The company was a pioneer in introducing parabolic springs to the Indian automotive market. Financial Overview For the financial year ended 31 March 2011 Jamna Auto reported a 47.3% increase in net sales to INR9bn (USD199m, 31 March 2011) compared with INR6.1bn (USD136.1m, 31 March 2010) in the previous year. The company benefited from strong growth recorded by the commercial vehicles segment in India during the financial year. Like other suppliers, the company faced margin pressure due to high raw materials prices for large part of the financial year. Despite this the company managed to record strong growth in earnings compared with a year ago. Jamna Auto reported a 35.6% increase in operating profit to INR1.1bn (USD23.8m). The company more than doubled its profit before tax to INR545.1m (USD12m). Jaman Auto concluded the financial year net profit of INR375m (USD8.3m) compared with INR191.1m (USD4.4m). Year Net Sales (INRm) 9,032.5 6,130.6 4,592.9 4,670.3 2,779.8 Net Sales (USDm) 199.0 136.1 88.0 117.0 64.0 Operating Profit (INRm) 1,082.2 798.0 374.4 607.7 250.3 Operating Profit (USDm) 23.8 17.7 7.2 15.2 5.8 Profit Before Tax (INRm) 545.1 246.0 (160.8) 200.8 71.1 Profit Before Tax (USDm) 12.0 5.5 (3.1) 5.0 1.6 Net Profit (INRm) 375.0 191.1 (125.7) 160.6 63.2 Net Profit(USD m) 8.3 4.2 (2.4) 4.0 1.4
2011 2010 2009 2008 2007 Year
2011 2010 2009 2008 2007
Outlook Jamna Auto will continue to focus on higher return on capital employed (ROCE) and improve PBT margin through better product mix and enhanced capacity. The company is shifting its focus to parabolic springs which are finding greater acceptance from the commercial vehicle manufacturers operating in India. Parabolic springs are lighter than lift springs, improve fuel efficiency, offer twice the life and give better ride comfort. While these springs are more widely used in light commercial vehicles (LCVs) automakers such as Tata Motors have started to use them for the heavy commercial vehicles (HCVs) as well. Jamna Autos decision to set up a plant in Chennai, Tamil Nadu (India) will help the company meet growing demand for parabolic springs. The company is diversifying into air suspension system and lift axles businesses which are expected to see strong demand from bus and truck manufacturers. Bus manufacturers are giving priority to comfort and hence increasingly introducing air suspension system technology in their new buses. The shifting preference towards higher tonnage vehicles bodes well for lift axles, which are used for load bearing purpose in HCVs. In order to meet expected surge in demand for these two components Jamna Auto is setting up a dedicated plant in Chennai, Tamil Nadu (India). This is expected to help the company open a new avenue for sales in coming years. The commercial vehicles segment in India continues to perform well despite some moderation in demand in the passenger car segment during 2011. According to IHS Automotive forecast, commercial vehicles, including light and heavy, sales in India are expected to grow from 1.28 million in 2010 to 3.1million units in 2020. The
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high growth potential of the Indian commercial vehicle market has attracted several global players in India. Jamna Auto, with nearly two-thirds market share in India, is well positioned to benefit from this trend.
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Jay Bharat Maruti

Axle assemblies, body-in-white, sheet metal components
Address Jay Bharat Maruti Limited 601, Hemkunt Chambers 89, Nehru Place, New Delhi-110 019 Tel: +91-11-26427104-6 Fax: +91-11-26427100 Internet: http://www.jbm-group.com/ Senior Officers S.K. Arya, Chairman and Managing Director Anand Swaroop, President & CFO S. Kartik, Company Secretary and Compliance Officer Products Axle assemblies, body-in-white, exhaust, fuel neck fillers, jigs & fixtures, skin panels, welded assemblies Plants Gurgaon (3) Sales INR10.6bn (USD, 233.6m, Year to 31.03.2011) Employees 3,210 (2011)
Jay Bharat Maruti (JBM) manufactures large and medium sheetmetal components, assemblies, and sub-assemblies for the automotive industry.
The company was incorporated in 1987 as a joint-venture between JBM Group and Maruti Suzuki India Limited (MSIL). Jay Bharat Maruti Limiteds (JBML) product portfolio include axle assemblies, body-in-white, exhaust, fuel neck fillers, jigs & fixtures, skin panels, welded assemblies. JBML's major customers include Ashok Leyland, Fiat, Ford, GM, JCB, Mahindra, Maruti Suzuki, Nissan, Renault, TATA, Toyota, Volkswagen and Volvo. Recent Developments Corporate strategy Over the years, JBML has expanded its product range and moved up the value chain, from manufacturing components to producing complete assemblies. Presently, the company supplies more than 150 types of sheet-metal components and sub-assemblies to MSIL for nearly all its vehicles. More than 85% of JBMLs sales are to MSIL. JBML is looking at expanding its base in the domestic market through strategic expansion. In September 2011, JBM Group announced plans to invest INR5bn (USD108.2m, 7 September 2011) in its three component companies in India, one of which is Jay Bharat Maruti Limited. The company is looking to expand in overseas markets, especially in emerging markets such as China and Mexico. The group derives 4% of sales from its overseas operations currently including western Europe and North America. JBML is also planning to set up plants outside India as well as following the acquisition route In January 2010, JBML announced that the company is targeting a fivefold rise in exports in the next seven years on the back of new and existing sourcing contracts from global auto majors such as Volvo, Husqvarna, Renault and GM. The company expects its exports to account for 25% of total sales in seven years from the current 5% of sales. Investments In September 2011, JBM Group announced plans to invest INR5bn (USD108.2m, 7 September 2011) in its three components companies in India. The companies include JBM Auto Systems, Neel Metals and Jay Bharat Maruti. In September 2011, JBML announced plans to open a research and development centre in India and supplement it with a centre in Singapore. The Indian R&D centre will employ about 50 people. Financial Overview In the financial year ended 31 March 2011, JBMLs sales increased 32% to INR10.6bn (USD233.6m, 31 March 2011) compared with INR8.03bn (USD178.4m) in the previous year. The companys profit before tax was INR566m (USD12.5m), up 72.6% from INR328m (USD7.3m) in 2010. Profit after tax increased 82.4% from INR210m (USD4.7m) to INR383m (USD8.4m). Year 2011 2010 2009 2008 2007 Net Sales (INRm) 10,603 8,032 6,917 6,570 5,195 Profit before tax (INRm 566 328 162 252 185 Profit after tax (INRm) 383 210 104 158 120 No. of Employees 3,310 -
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Year 2011 2010 2009 2008 2007
Net Sales (USDm) 233.6 178.4 132.6 164.7 130.2
Profit before tax (USDm) 12.5 7.3 3.1 6.3 4.6
Net Income (USDm) 8.4 4.7 1.9 3.9 8.8
No. of Employees 3,310 -
Outlook JBML has registered a significant growth over the past few years. The groups expansion in domestic plants is expected to help it meet requirements of its customers. The companys expansion strategy is expected to help it achieve a five-fold growth in exports in the next five years. The companys key customer MSIL has been posting strong sales which present a positive outlook for the company.
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Jay-Ushin
Body parts, security systems and switches
Address
Jay-Ushin Ltd GP 14, HSIDC Industrial Estate Sector 18 Gurgaon-122001 Haryana India
Jay-Ushin, the flagship company of JP Minda Group, is a major supplier of lock sets, door latches, instrument clusters, sensors, controllers and switches in India.
Jay-Ushin was set up in 1986 as a joint-venture between the J P Minda Group of India and U-Shin Ltd of Japan to manufacture auto electrical, mechanical and electronic components for four-wheelers. U-shin holds a 25% equity in the company. In 1989, the company became operational and started supplying lock sets to Maruti Udyog, now Maruti Suzuki. In 1996, the company diversified its business and began supplying instrument clusters to Maruti Suzuki. The company has a technical collaboration with YNS Inc. of Japan for instrument clusters since 1995. Jay-Ushin has another technical collaboration with Shinchang Electric Co. Ltd. of Korea since 1998 to manufacture key sets and multi-function switches for Hyundai Motor India. Jay-Ushin operates three manufacturing plants in India. The company has two plants in Haryana, located in Gurgaon and Manesar and one in Sriperumbudur, Tamil Nadu. The company employs 490 people. Jay-Ushin supplies to almost all major automobile manufacturers in India. The companys main customers include Ashok Leyland, Bajaj Auto, Cummins India, Fiat India, Ford India, Eicher, Escort, GM India, Hindustan Motors, Hero, Honda Motorcycle and Scooter India, Honda Siel, Hyundai Motor India, Kinetic Motors, Mahindra & Mahindra, Maruti Suzuki, Royal Enfield, SML Isuzu, Tata Motors and Yamaha Motors India.
Tel: +91 124 4623400 Internet: http:// www.jpmgroup.co.in Senior Officers

J P Minda, Executive Chairman Ashwani Minda, Managing Director Anil Minda, Technical Director S K Agarwal, General Manager, Finance
Products
Security systems: immobilizers, key sets, keyless entry, remote locking Body parts: central locking, door latches, door handles, hood latches, strikers Switches: combination switches, defogger switches, handle bar, hazard warning, panel switches, power window, stop and back-up lamps Others: heater control lever assemblies, heater panel assembly, tank units Plants India (3): Haryana (2), Tamil Nadu
Recent Developments
Corporate Strategy Jay-Ushin has been investing in modernisation and expansion of its manufacturing facilities to meet expected surge in demand in the Indian automotive market. The company invested INR132m (USD2.9m, 31 March 2011) in this area in financial year 2011 and INR177.5m (USD3.9m, 31 March 2010) in 2010. The company continues to rely on its joint-venture partner U-Shin and other technical collaborators to introduce new products to meet increasing demand for security system products. Growing competition in the Indian automotive industry is driving automakers to offer several new features such as advance security systems in vehicles as brand differentiator. As a major supplier of automotive security systems, Jay-Ushin is well positioned to grow in coming years. Contracts In 2008, Jay-Ushin supplied lock set, backdoor switch, HLL switch and HVAC switch to Maruti Szuki for the Swift Dzire, A/C switch to Mahindra & Mahindra for Xylo, and HVAC switches to Honda for City. In 2007, Jay-Ushin supplied ignition coil, lockset, and combination switch for Hyundai i10. It also supplied ignition coil, lockset, mirror switch, back up lamp switch, and HVAC switches to Maruti SX4 and lockset to Mitsubishi Lancer. The company also supplies power window switches and back-up lamp switches for the Hyundai Santro program. Jay-Ushin supplies lock-key sets and latches for the Maruti 800, Alto, Wagon-R and Baleno. It also supplies central locking for Alto, Wagon- R and heater assemblies to Honda Jay-Ushin supplies lock-sets for the HM-Mitsubishi Lancer.
Sales
INR 4.5bn (USD99.8m, 31 March 2011) (Year to 31.03.11)
Employees
490 (2011)
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New Product Developments Jay-Ushin developed M/F switches, panel switches and power window switches for Santro and Ascent model of Hyundai Motors India Ltd. Jay-Ushin developed A/C control panels for Indica and Safari model of Tata Motors. It also developed door latches and inner door handles for the Indica model. Jay-Ushin developed handle bar switches and lock set modular switches for KSPA and new motorcycle model KPLA/KRPA by Honda Motorcycle & Scooter India
Certification Jay-Ushin has been accredited with ISO/ TS 16949:2002 status.
Financial Overview In the financial year ended 31 March 2011, Jay-Ushin

recorded a 26.7% increase in sales to INR 4.5bn (USD99.7m, 31 March 2011) compared with INR3.5bn (USD79.3m, 31 March 2010) in the previous year.
The company reported profit before tax of INR139.1bn (USD3.1m) over INR84.2m (USD1.9m) in the previous financial year. The company concluded the financial year with a 49.5% increase in net profit to INR101.9m (USD2.2m) compared with INR60.6m (USD1.3bn) in the preceding year. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 4,526.3 3,572.9 2,508.8 2,376.9 1,531.8 Net Sales (USDm) 99.7 79.3 48.1 59.6 35.3 Profit Before Tax (INRm) 139.1 84.2 37.2 68.4 25.1 Profit Before Tax (USDm) 3.1 1.9 0.7 1.7 0.6 Net Profit (INRm) 101.9 60.6 20.3 44.9 66.3 Net Profit (USDm) 2.2 1.3 0.4 1.1 1.5
Outlook
With increasing concern for car theft in India, Jay-Ushins sales of security systems are expected to grow. However, the company faces stiff competition from domestic players. In the future, this competition is likely to intensify with increasing presence of global safety system products suppliers. The investment made by Jay-Ushin in upgrading its facilities and expanding capacities will help the company to gain a wider customer base and leverage the growing opportunities in the domestic and international markets, with new customers entering the market and old customers introducing new models. Increasing content per car produced by the company will also help growth. The companys strategy to innovate and develop quality low cost components will also help it grow its customer base. Jay-Ushin expects to gain from expected growth of the Indian automotive industry. Several global automakers continue to enter the Indian automotive market, lured by its high growth potential. Jay-Ushin hopes to supply these new players and expand its customer base in coming years.
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Jaya Hind
Aluminium die-castings and automotive components
Address Jaya Hind Industries Ltd Mumbai-Pune Road Akurdi, Pune 411 035 Maharashtra India Tel: +91 20 2747 3981 Fax: +91 20 2747 4827 Website: http://www.jayahind.com Senior Officers Abhay Firodia, Chairman Prasan Firodia, Managing Director Shreeranga N S, COO M S Bhogal, Director, Technical R B Bhandari, Director Products AC generators, alternator mountings, coolant pipes, brake caliper, clutch plate, cylinder head cover, clutch housing, crank case, cylinder head cover, differential cover, flywheel generator, ignition coil, intake manifolds, pressure die-casting, oil cooler head, oil sump, timing case cover, turbo charger castings and turbo charger pipes, wiper motor and water pumps Plants India (2): Maharashtra (2) Sales INR3.2bn (USD70.4m, 31 March 2011)
Jaya Hind Industries, part of Force Motor Group, manufactures aluminium castings and automotive components. The company is a major supplier of ignition coils, AC generators and flywheel generators for two- and three-wheeler sectors. In addition, the company supplies clutch discs and clutch cover assemblies, brakes calipers and water pumps to OEMs.
Though established in 1948, Jaya Hind Industries started its automotive components business in 1964, when the company set up a pressure die-castings plant in Akurdi, near Pune, Maharashtra. Since then Jaya Hind has expanded its business through entering into several strategic alliances including Denso, Nemak, Handtmann, VAW Mandl & Berger, Heck & Becker, Bridge Aluminium and Kolbenschmidt Aluminium Technologie AG (KSAT). Jaya Hind organises its business into the following operating divisions: High pressure die-castings: manufactures engine blocks, bed plates, transmission cases and fully-machined oil pans. The company mainly focuses on large components. The majority of Jaya Hinds machining starts from 800 tonnes and they go up to 3500 tonnes. Auto components: involved in producing brakes, clutches for both original equipment (OE) and after market Fabrication: makes tippers for MAN-Force trucks. The company manufactures both rock body tippers for mining and box body tippers for construction vehicles. Gravity die-castings: produces aluminum cylinder heads. The company is the leading supplier of aluminum cylinder heads in India. Jaya Hind operates two plants, both of which are located in Akurdi and Urse, in Pune, Maharashtra. The company has 1,339 employees. The company supplies its components to both automakers and tier one suppliers. Among automakers, the company supplies its products to Ashok Leyland, Eicher Motors, Fiat, Force Motors, GM India, Hindustan Motors, Mahindra & Mahindra, MAN-Force, Maruti-Suzuki, Renault-Nissan and Tata Motors. The companys major customers among tier one suppliers include Allison Transmission, Bosch, Cummins, Knorr Bremse, Lumax, Rane TRW Steering Systems and ZF.
Employees
c. 1,339
Recent Developments
Corporate strategy Jaya Hind has been investing in upgrading its manufacturing operations and product development capabilities. The company announced plans to ramp up the production of cylinder heads from 400,000 units per annum in 2010 to 800,000 units a year by 2012 considering a boom in the demand for automobiles in India. Meanwhile, the company continues to focus on diversifying its product lines through entering into strategic alliances with leading global suppliers. Most recently, Jaya Hind entered into a partnership with Germany-based Kolbenschmidt Aluminium Technologie AG (KSAT) to manufacture aluminum cylinder blocks. The proposed JV will be implemented in two phases. In the first stage, Jaya Hind entered into a know-how agreement with the German supplier for cylinder blocks, bed plates and cylinder heads. KSAT will help Jaya Hind in design and development. In the second stage, the two partners will enter into a financial JV to begin joint production of these components. The two suppliers have already signed a letter of intent (LOI) to set up a JV in India. Jaya Hind also hopes to leverage this strategic partnership to enter the European auto component market. Joint-ventures In January 2011, Jaya Hind signed a letter of intent (LOI) with Kolbenschmidt Aluminium Technologie AG (KSAT) to form a jointventure (JV) in India to manufacture cylinder blocks, bed plates and
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cylinder heads. Under the JV KSAT will assist Jaya Hind in design, development, production, quality and engineering process. Investments In 2007, Jaya Hind increased aluminum high-pressure die casting capacity to 25,000 tons per anum. The company added five new casting cells in the range of 850 to 3200tonnes locking force. In March 2006, Jaya Hind has invested around USD25m to upgrade technology and enhance capacity. Contracts Jaya Hind which currently supplies tippers for MAN-Force Trucks plans to expand its offerings to the commercial vehicle manufacturer by 75% in 2011. Jaya Hind supplies cylinder heads for the Tata Indica Vista. Jaya Hind supplies the entire gearbox housing for GM's Chevrolet Tavera. The company supplies cylinder heads for the Isuzu engine produced by Hindustan Motors. The company is the single source supplier for Mahindra Scorpio's gearbox and is currently developing transaxle gearbox housing for the Mahindra Champion. Certification In 2010, Jaya Hind received ISO14001and OHSAS18001 certifications.
Financial Overview For the financial year ended 31 March 2011 Jaya Hind was expecting sales of INR3.2bn (USD70.4m, 31 March 2011) compared with INR1.98 (USD43.9m, 31 March 2010) achieved in 2010. Jaya Hind is a privately held company and therefore it does not disclose its detailed financial results. Outlook Jaya Hind has emerged as a major casting supplier with continuing upgrades at the facility carried out over the past seven years. As a result the company has become one of the largest producers of aluminum cylinder heads, deployed in common-rail engine technology in India. The increased capacity is expected to help the company to meet expected surge in demand for casting products. The Indian automotive industry continues to witness entry of several new major automakers. This is expected to result in more business for the company. Jaya Hind also hopes to benefit from the joint-venture with KSAT. The JV is expected to not only enhance the Indian partners design, development and manufacturing capacity of engine components but also provide access to the European automotive market. This will help Jaya Hind to further strengthen its position as one of the leading suppliers of cylinder heads in coming years.
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JK Tyre
Tyres
Address JK Tyre & Industries Ltd Link House 3 Bahadur Shah Zafar Marg New Delhi 110 002 India Tel: +91 11 2331 111 2/3/4/5/6/7 Fax: +91 11 2332 2059 Internet: http:// www.jktyre.com Senior Officers Hari Shankar Singhania, Chairman Dr. Raghupati Singhania, Vice-Chairman & Managing Director Arun Kumar Bajoria, President & Director A K. Kinra, Finance Director V. K. Misra, Technical Director A S. Mehta, Marketing Director Swaranjit Singh, Materials Director Sanjee Saxena, VP, Corporate Account Products Tyres and steel wheels Plants India (5): Karnataka (3), Madhya Pradesh, Rajasthan Outside India: Mexico (3) Sales Group: INR59.4bn (USD1.3bn, 31 March 2011) (Year to 31.03.11) Employees Group: 5,340 (March 2011)
JK Tyre is the third largest tyre manufacturer in India. The company makes tyres for two- and three-wheelers, passenger cars and commercial vehicles. The company also produces tyres for off-the road (OTR) segment for use in agriculture, mining, rock excavating, quarrying, dam building and port operations. In addition to tyres, the company makes steel wheels for the automotive industry.
JK Tyre has a diversified portfolio of tyres catering to passenger cars, commercial vehicles and off-the road (OTR) segment including farm equipment. In June 2007, the company re-entered the two-wheeler and threewheeler segment. The company sells its tyres under JK Tyre and Vikrant brands. Apart from tyres, JK Tyre produces steel wheels for the automotive industry. The company operates five manufacturing plants in India and three in Mexico. Of the five facilities in India, three are located in Mysore, Karnataka and one each in Banmore, Madhya Pradesh and Kankroli, Rajasthan. In addition, JK Tyre is setting its sixth plant in Sriperumbudur near Chennai (India) which is expected to become operational by the end of 2011. Outside India, JK Tyre operates three manufacturing plants in Mexico, run by its wholly-owned subsidiary JK Tornell, following the acquisition of Tornel in 2008. The company expects its total production capacity to reach 15.5 million units a year, once the Chennai plant becomes fully operational. As of 31 March 2011, the company had 5,340 employees. JK Tyre supplies to both original equipment (OE) and replacement markets. In the OE market, the companys major customers include Ashok Leyland, GM, Fiat, Maruti Suzuki, Tata Motors and Volkswagen. In addition to catering to domestic demand, the company exports its tyres to 80 countries worldwide. JK Tyre has entered into sourcing agreements with tyre manufacturers in China, Vietnam and Sri Lanka to meet increasing exports demand. Recent Developments Corporate strategy JK Tyre is investing in capacity expansion in order to meet expected surge in demand of tyres, both in India and in the international market. In March 2010, the company announced plans to invest INR16bn (USD355.3m, 31 March 2010) in a new facility near Chennai, Tamil Nadu (India) to manufacture radial tyres for passenger cars and commercial vehicles. The new plant will have an initial production capacity of 2.5 million tyres for passenger cars and 200,000 tyres for trucks and buses which will be further ramped up to five million units for passenger cars and 400,000 units for commercial vehicles. The company is also working to ramp up capacity at its Mexico plants in order to meet high demand. Overall the company has set a goal to increase its overseas presence by 15% to 20% a year. The company is the leading proponent of radialisation of truck tyres in India and is presently the market leader in this segment. To keep pace with the growth in demand, JK Tyre plans to increase capacity at its existing plants in India from the current 8.7 million to 12 million tyres per annum by 2011. The company has aggressively targeted the export market with the acquisition of Tornel. The acquisition added a production capacity of 290 tonnes per day to the earlier capacity of 650 tonnes per day. Acquisitions In April 2008, JK Tyre announced the acquisition of Mexico-based tyre manufacturer Tornel for INR2.7bn (USD66.9m, 30 April 2008). The acquired company manufactures bias and radial tyres for passenger cars, commercial vehicles and off-the-road (OTR) vehicles. Tornel operates three manufacturing plants in Mexico located in Azcapotzalco, Tultitlan and Hidalgo, with a combined annual production capacity of 6.6 million tyres per year. The acquired company also has a wide distribution network
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in Mexico with 241 distributors and 282 sales outlets. The acquisition was completed in June 2008. Investments In March 2010, JK Tyre announced it would set up a plant at Sriperumbudur, near Chennai, Tamil Nadu (India) to manufacture radial tyres for passenger cars and commercial vehicles. The plant will have an initial production capacity of 2.5 million tyres for passenger cars and 200,000 tyres for trucks and buses. JK Tyre will invest INR16bn (USD355.3m, 31 March 2010) in two phases. In the first phase, the company will invest INR8bn (USD175.7m). The company will invest another INR7.5bn (USD166.7m) to INR8bn (USD177.7m) in the second phase to increase annual production capacity at the plant to five million units for cars and 700,000 units for trucks and buses. The company expects the plant to become operational by the end of 2011. In January 2010, JK Tyre announced plans to set up a greenfield plant and research and development (R&D) centre near its Mysore plant in Karnataka (India). The company will invest INR8bn (USD170.1m, 31 January 2010) in the capacity expansion to meet growing tyre demand in both passenger and car commercial vehicle segments. In September 2009, JK Tyre commissioned its truck and bus radial tyre plant in Mysore, Karnataka (India). The company completed capacity expansion at the facility, investing INR3.15bn (USD65.2m, 30 September 2009), raising its annual production capacity from 367,000 to 800,000 units. The company also invested another INR1.2bn (USD24.8m) at its existing facility in Mysore to expand OTR capacity. In addition, the company intends to invest INR2bn (USD41.4m) in another expansion at the facility which would augment capacity by another 200,000 units a year. In July 2007, JK Tyre announced it would increase investment in capacity expansion over the next three years from INR6bn (USD148m) to INR11bn (USD271.3m) in order to raise total production capacity by 30% by 2010. The company decided to increase the capacity of passenger radials manufacturing facility from 4.5 million units to seven million units per annum and bus-truck radial manufacturing facility to one million tyres per annum. In May 2007, JK Tyre revealed its plans to invest INR1.2bn (USD29.4m) in the next twelve months to increase the capacity of OTR segment by around 50%. The company also planned to expand production capacity of passenger radial segment by 35%. Contracts JK Tyre supplies its Vectra radial tyres to Chevrolet Cruze sedan. JK Tyre supplies tubeless radial tyres to small car programmes of several automakers operating in India including Chevrolet Beat, Fiat Punto, Suzuki Ritz and Volkswagen Polo. JK Tyre is the sole supplier to the Maruti Suzuki SX4-Zxi and Swift programmes. JK Tyre supplies to the former Mahindra Logan, now known as Verito, and Scorpio models for their export programmes. New Product Developments In the financial year ended 31 March 2010, JK Tyre spent INR163.9m (USD3.6m, 31 March 2010) on research and development (R&D), around 0.4% of its sales, compared with INR182.1m (USD3.5m, 31 March 2009). The company conducts its in-house R&D at its technical centre in Faridabad, Haryana (India). The centre is engaged in product design, development, validation and industrialisation. The company also collaborates with Hari Shankar Singhania Elastomer and Tire Research Institute (HASETRI), an independent research organisation located in Kankroli, Rajsthan (India). In addition, JK Tyre has a technical collaboration with German tyremaker Continental AG for steel-belted truck radial tyres. In December 2010, JK Tyre rolled out the largest OTR tyre in India. The company produced the 40.00-57 60PR VEM045 E4 tubeless tyre, which weighs around 3,700 Kg. The tyre is about 12 feet high from ground and is fitted in 240 tonne Rear Dump Trucks the largest haulage equipment in India. This is reported to be the biggest size tyre manufactured in India so far. Up till now this size was imported into India from the USA and
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China. Financial Overview In the financial year ended 31 March 2011 JK Tyre reported a 30% increase in sales to INR59.4bn (USD1.3bn, 31 March 2011) compared with INR45.7bn (USD1bn, 31 March 2010) a year ago. The company benefited from strong demand for tyres in India driven by nearly 30% surge in the domestic vehicle sales during the year. The company reported an operating profit of INR3.2bn (USD71m), down 60.3% from INR5.2bn (USD114.8m) a year ago. The sharp decline in operating profit was mainly due to a strong increase of 61% in raw materials costs from INR27.2bn (USD604m) to INR43.8bn (USD964.8m). JK Tyre reported a 64.2% decline in profit before tax to INR 1.1bn (USD24.7m) over INR3.1bn (USD69.5m) a year ago while its net profit plunged 70.5% to INR659.1m (USD14.5m) compared with INR2.2bn (USD49.7m) in the previous fiscal. JK Tyre changed its reporting year in 2009 from 30 September to 31 March. Therefore the companys 2009 results include its performance for 18 months from 1 October 2007 to 31 March 2009. Year 2011 2010 2009 2007 2006 Net Sales (INRm) 59,454.4 45,705.8 55,227.0 28,161.6 26,092.0 Profit Before Tax (INRm) 1,119.6 3,130.4 (750.4) 1,007.1 217.0 Net Profit (INRm) 625.5 2,197.4 (1,079.8) 666.9 170.0
Year 2011 2010 2009 2007 2006
Net Sales (USDm) 1,309.6 1,015.0 1,058.5 705.8 600.6
Profit Before Tax (USDm) 24.7 69.5 (14.4) 25.2 5.0
Net Profit (USDm) 13.8 48.8 19.9 16.7 3.9
Outlook The continuing rise in raw materials prices is a major concern for most of the tyremakers including JK Tyre. The company is planning to acquire a rubber plantation in order to offset rising prices of natural rubber. In addition the company is working on the development of a substitute of rubber at its R&D centres. JK Tyre witnessed a 61% increase in overall raw material prices during fiscal 2011, compared with a year ago. Although the company has tried to offset the increase in production cost due to steep hike in raw material prices, through rising prises, it has not been able to pass on the price hike to its customers. This has put pressure on the companys margin in recent years. JK Tyre, like other tyremakers operating in India, is facing stiff competition from the Chinese automakers. The Chinese tyremakers are able to sell tyres in India at 20% discount because of subsidies provided by their government. In order to offset the gain, the Indian government levied anti-dumping duty on tyre imports from China. JK Tyre expects anti-dumping duty on such imports of tyre to stay. JK Tyre was a pioneer in introducing radial tyre technology in India 30 years ago. The company produces about 75% of Indias total truck/bus radial tyres and is the market leader in the segment. JK Tyre recently doubled truck and bus radial tyres capacity through investing at its facility in Mysore, Karnataka (India). The company expects radicalisation in the truck/ bus segment to go up to 35% compared with the 17-18% at present in India. As a leader in the truck/bus radialisation, JK Tyre is well positioned to gain from this trend in coming years.
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JKM Automotive
Engine and transmission components
Address JKM Automotive Ltd F-67, C 23-24, JKM Park SIPCOT Industrial Complex Irrungattukottai Kanchipuram 602 105 Tamil Nadu India Tel: +91 44 4710 3000 Website: http://www.dynamatics.com/ Senior Officers Vijay Kapur, Chairman, Dynamatics Udayant Malhoutra, CEO, Managing Director, Dynamatics V. Sunder, President, Group CFO, Dynamatics PK Ray Chaudhari, Head, Engineering, Research & Development, Dynamatics D Satheesh Kumar, Deputy Chief Operating Officer, JKM Automotive CS Kim, Vice-President, Technical, JKM Automotive Products Body speedometer, bushes, camshaft cap, case differential, case oil seal, Clutch reverse forks, dog controls, exhaust manifold, fork shifts, inlet manifold, lever selection assembly, lever clutch operating, lube- oil pump assembly, rocker arms, rocker cover assembly, support differential, support engine, support gear box and water pump assembly Plants India (2): Tamil Nadu (2) Sales Group: NR3.8bn (USD83.7m, 31 March 2011) JKM Automotive: INR1.92bn (USD42,292)
JKM Automotive is the automotive division of Dynamatic Technologies. The company produces ferrous and non-ferrous for the global engine and transmission components automotive industry.
JKM Automotive, formerly known as JKM Dae Rim Automotive, was established as a 73:27 joint-venture (JV) between Dynamatic Technologies and DaeRim Enterprise in 1997. The company was set up initially to supply Hyundai Motors India but has over the years, added other domestic customers. In June 2007, Dynamatic took over the full control of JKM Automotive through purchasing its JV partners stake. Dynamatic Technologies divides its comprehensive business into five operating segments: Hydraulic and Precision Engineering (accounted for 41% of the financial year 2011 sales), Automotive Components (34%), Aerospace (18%), Aluminium Castings (6%), and Wind Farm (1%). The Automotive Components is run under JKM Automotive. The division manufactures components including case fronts, water pumps, intake and exhaust manifolds. JKM Automotive operates two plants in India which are located in Chennai, Tamil Nadu and supplies to automotive and off-the road (OTR) sectors. JKM Automotive's supplies its products to major automakers and tier one suppliers operating in India. The companys main customers among automakers include Daimler, Fiat, Ford, GM, John Deere, Mahindra & Mahindra, Renault Nissan and Tata Motors. The companys customers among tier one suppliers includes Cummins and Honeywell. In addition, the company meets overseas requirement of some of its customers including John Deere in the US, Cummins in the UK and the US, Ford in South Africa, Honeywell in Italy and France and Getrag Ford in the UK. Recent developments Corporate strategy Dynamatic Technologies is expanding its auto-component business line through selective acquisitions and greenfield investments. In June 2011, the company acquired Germany-based automotive castings manufacturer Eisenwerke Erla. The acquired company is a major supplier of emission control products to leading automakers in Europe including BMW, Daimler and Volkswagen. The acquisition is expected to significantly expand JKM Automotives product portfolio, increase its international presence and broaden its customer base. Following the acquisition, Dynamatic is planning to demerge its automotive business (JKM Automotive) into a wholly-owned subsidiary JKM Erla Automotive. The company will consolidate the operations of Eisenwerke with JKM Automotive in order to yield synergies of both businesses. With this move, Dynamatic aims to capture the growing demand for exhaust system components in the automotive industry. JKM Automotive expects its sales to record a fivefold growth over the next five years. Meanwhile, JKM Automotive is investing in the latest production technology and the company is converting its four manufacturing lines of exhaust manifold to fully automatic robotic machining lines. This will help the company reduce labour cost and enhance manufacturing efficiency. The process is in the final stages of completion. In recent years, JKM Automotive has won several contracts from automakers to supply their leading programmes. This helped the company to grow beyond its main customer Hyundai. The company supplies components to Tata and Mahindra. The company has also gained entry into foreign markets and currently exports products to Ford, Cummins and Honeywell. This has significantly reduced its dependence on Hyundai for business.
Employees
c. 600 (2011)
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Acquisitions In June 2011, Dynamatic Technologies acquired Germany-based automotive castings manufacturer Eisenwerke Erla GmbH through its subsidiary JKM Erla Automotive. Dynamatic acquired the German company from the Sanmar Group in an all-cash transaction. The acquired company is a major supplier of emission control products to leading automakers in Europe including BMW, Daimler and Volkswagen. The company did not divulge the financial details of the transaction. Investments In September 2007, JKM Automotive inaugurated its second manufacturing facility in India located in Chennai, Tamil Nadu. The plant is situated in close proximity to its existing plant in Irrungattukottai, near Chennai, Tamil Nadu. Contracts In May 2009, JKM Automotive secured a contract from Ford to supply main bearing caps (MBC) to the automakers planst in South Africa, Thailand and Argentina. The component is fitted in Fords PUMA engine. In May 2009, JKM Automotive started supplying compressor housings to Honeywells plant in Pune, Maharashtra. In April 2009, JKM Automotive bagged an additional contract from Honeywell to supply compressor housings which are used in Honeywell turbo chargers and are supplied to Ford for assembly in the PUMA Engine. In July 2008, JKM Automotive won a contract from Tata to supply transmission components. JKM Automotive supplies to Hyundai Santro, i10, i20 and Accent models. JKM Automotive supplies to Tata Indica, Indiago, Vista and Manza models. JKM Automotive supplies to Fiat Punto and Linea programmes. JKM Automotive supplies to GM Tavera multi-purpose vehicle (MPV). JKM Automotive is the single source supplier for a wide variety of critical engine and transmission parts for the Hyundai Santro and Accent cars. The company supplies components to the Tata Indica and Sumo programmes. JKM Automotive has a contract for Mitsubishi Lancer and Mahindra Scorpio models. Certifications JKM Automotives both plants in Chennai has TS16949, OSHAS 18000 and ISO14000 quality certifications.
Financial Overview In the financial year ended 31 March 2011 Dynamatic Technologies reported a 12.5% increase in consolidated net sales to INR4.9bn (USD109m, 31 March 2011) compared with INR4.4bn (USD97.7m, 31 March 2010) a year earlier. Despite moderate growth in sales, the company almost doubled its profit before tax (PBT) to INR303.3m (USD6.7m) over INR158.3m (USD3.5m) in the previous financial year. Dynamatic Technologies concluded the financial year with net profit of INR216.8m (USD4.8m), more than double compared with INR105.1m (USD2.3m) in 2010. The Automotive Component segment of Dynamatic Technologies, JKM Automotive, reported a marginal 1.3% increase in sales to INR1.92bn (USD42.4m) compared with INR1.90bn (USD42.2m) during the period. The segment reported profit before interest and tax (PBIT) of INR20.6m (USD453,766, marking an 80.3% decline from INR105.1m (USD2.3m) in 2010. Year 2011 2010 2009 Net Sales (INRm) 4,950.4 4,398.9 4,083.4 Profit Before Tax (INRm) 303.3 158.3 3.528 Net Profit (INRm) 216.8 105.1 (52.3)
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2008 2007 Year 2011 2010 2009 2008 2007
3,559.6 2,402.9 Net Sales (USDm) 109.0 97.7 78.3 89.2 55.3
301.4 233.0 Profit Before Tax (USDm) 6.7 3.5 0.07 7.5 5.4
180.5 131.9 Net Profit (USDm) 4.8 2.3 (1) 4.5 3.0
Outlook JKM Automotive has benefited from the strong growth of Hyundai in India over more than a decade. This has allowed the component supplier to attain a critical size of operations. JKM Automotive is further expected to benefit from introduction of new models by the South Korean automaker in India including the small car positioned below Santro and which is expected to take on Maruti Suzuki Alto, the largest selling small car model in the country. However, JKM Automotive is working to mitigate its business risk by reducing its dependence on the South Korean automaker and adding new automakers to its customer base. The move has given significant volumes to the company which has helped it expand its sales in India. Currently, the company, through its diverse product line, serves 40% of the passenger car market in India. The company has expanded its relationship with some of its customers in India and is now engaged in supplying directly to their global operations as well. The acquisition of Eisenwerk Erla is expected to strengthen its product portfolio and boost its presence in the European exhaust and turbocharger market. The company will also gain acess to Eisenwerks manufacturing plants in Europe and Asia. This is also expected to further expand JKMs customer base with the inclusion of some leading European automakers, such as Volkswagen, Audi, MAN and BMW.
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Johnson Matthey
Catalytic Converters
Address Johnson Matthey India Private Limited Plot No 12, Sector 3 IMT Manesar Gurgaon-122050 Haryana India Tel: +91 124 4580 100 Fax: +91 124 2290 239 / 240 Internet: http://www.jmindia.co.in Senior Officers Alok Khetan, Managing Director Products Auto catalysts, diesel catalysts Plants India (3): Haryana Sales Group: GBP9.9bn (USD15.8bn, 31 March 2011) (Year to 31.03.11) Employees c. 400
Johnson Matthey is a speciality chemicals company with interests in catalysts, precious metals, fine chemicals and process technology. The company is a major supplier of catalytic converters in India. In addition to automotive, the company caters to agriculture and pharmaceutical industries.
Johnson Mattheys operations are classified under three business segments: Environmental Technologies, Precious Metal Products and Fine Chemicals & Catalysts. The Environmental Technologies segment is further categorised into Emission Control Technologies (ECT), Process Technologies and Fuel Cells. ECT comprises Johnson Mattheys global auto-catalyst, heavy duty diesel and stationary emissions control businesses. Johnson Matthey Indias (JMI) business areas include ECT that offers catalyst technologies to two wheelers, passenger cars, utility vehicles, trucks, buses, and small utility engines. The business area also offers retrofit systems, which include CRT system for control of diesel emissions from buses, trucks, construction equipment, trains and other heavy diesel engines. In addition, the ECT offers contract testing services for engines, engine emissions and catalyst performance. In the non-automotive area, catalyst and systems are being offered to control gaseous and particulate emissions from stationary sources. Johnson Matthey India operates three manufacturing plants located in Manesar, Haryana; Mumbai, Maharashtra and Kanpur, Uttar Pradesh. The companys biggest automotive customer India is Maruti Suzuki, the leading passenger car manufacturer in the Indian automotive market. Approximately 50% of the companys revenues come from Maruti. Besides, the company has registered significant growth in supplies to Ford India and Mahindra & Mahindra. Recent Developments Corporate strategy Johnson Matthey is expanding its product offering for the Indian automotive market to help automakers operating in the country to meet stringent emission regulations. In financial year 2011, the company commenced selling heavy duty diesel catalyst in India and China. In October 2010, India implemented Bharat IV emission regulations, which are equivalent to Euro IV, across National Capital Region (NCR) and 13 cities. These regulations are expected to become ever more stringent in coming years, as the Indian government intensifies its focus on pollution reduction. Johnson Matthey believes that while automakers have a number of options on how they achieve lower pollution levels, ultimately tighter legislation will require improved catalyst technology, ensuring continued growth of catalysts business at the company Investments In the financial year 2011, Johnson Matthey started expansion of autocatalyst plants in India and Malaysia. However, details of expansion are not available. Contracts Johnson Matthey supplies catalysts to all models of Maruti Suzuki. The company meets about 80% of Maruti Suzukis total requirements. New Product Developments Johnson Matthey Catalysts does not invest in research and development (R&D) in India. All product development is sourced from the parent company.
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Financial Overview For the year ended 31 March 2011, Johnson Matthey reported net sales of GBP9.9bn (USD15.8bn, 31 March 2011), an increase of 27% from GBP7.8bn (USD11.7bn, 31 March 2010) recorded in the same period of the previous year. Emission Control Technologies sales increased by 25% to GBP1.2bn (USD1.9bn); light-duty catalysts sales were up by 16% to GBP879m (USD1.4bn) and heavy-duty diesel catalysts grew by 71% to GBP296m (USD474.5m). The company does not report sales for its Indian subsidiary separately. Asia contributed around 10% to the total sales in financial year 2010-11. In ECT division, Asia contributed 11% to the total divisional sales. Geographically, Asia (excluding China) reported sales of GBP965.1m (USD1.5bn), an increase of 76.3% from GBP547.3m (USD824.6m) recorded in the previous year. Outlook Johnson Matthey operates in Emission Control Technologies (ECT) of the automotive industry which has tremendous growth potential. Automakers worldwide are strongly focusing on vehicle emissions reduction in order to meet the government regulations. As a major provider of emission reducing technologies, Johnson Matthey is well positioned to grow in most of the automotive markets including in India. Growth of ECT business is directly related to vehicle production. Johnson Matthey expects its ECT to benefit from the higher global car production, especially in Asia in the medium to long term despite having some moderation in demand in the short term.
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Kalyani Forge
Precision forgings and forged components
Address Kalyani Forge Ltd 1st Floor, C Wing Shangrila Gardens Opposite Bund Garden Pune - 411001 Maharashtra India Tel: +91 21 3725 2335 Fax: +91 21 3725 2344 Website: http://www.kalyaniforge.co.in Senior Officers Dr N A Kalyani, Chairman Rohini G Kalyani, Vice-Chairman, Managing Director Gaurishankar N Kalyani, Director KVLN Murty, CEO C Mohan, COO Mangesh Annachhatre, CFO Milind Shenolikar, Vice-President, International Business & Marketing Products Bracket/FS arms, camshaft, chassis systems, clamp injector, connecting rods, crosshead valve, flange, fork, gears, head piston, nozzle ring/pipe cast, pitman arm, rear axle, sector shapt, shaft adjuster, spiders shafts, spiders, stub axle, steering parts, tappet, tulips, valve retainer Plants India (2): Maharashtra (2) Sales INR2.4bn (USD52.7m, 31 March 2011), (Year to 31.03.11) Employees c. 1,352 (2011)
Kalyani Forge is a leading manufacturer of precision forgings and forged machined components such as connecting rods for two- and four-wheelers. The company supplies to both automotive and nonautomotive sectors.
Kalyani Forge was established in 1979, as a niche forge shop incorporating press technology for small forgings. The company started commercial production of hot forgings two years later. The companys business is organised into four operating divisions Precision Auto Components Division, Product Engineering Division, Hot Forging Division and Metal Forms Division. The company operates two manufacturing plants in India, both located in Shirur near Pune, Maharashtra. Kalyani Forge counts on both automakers and suppliers as its major customers. Among automakers the company supplies to Ashok Leyland, Force Motors, Hero, MAN-Force, Mahindra & Mahindra, Mahindra Navistar, Nissan Ashok Leyland, Piaggio, Tata Motors and TVS Motor. The company also caters to major supplier including Amtek Auto, Bosch, Cummins India, Dae Seung Autoparts, Endurance, GKN Driveline India, Varroc and ZF Steering Gears. Kalyani Forges international customers are Cummins, Honeywell Turbo, JCB, Knorr-Bremse, Lombardini, and Renault. Recent Developments Corporate strategy Kalyani Forge is focusing on reducing costs through improving its product mix. All those components which were contributing little to the companys profitability, where the value addition per kilogram of input/finish weight was lower, were identified and the company requested customers to either increase the price or find an alternative to those components. In addition, as inventory costs are high in low volume products, Kalyani Forge requested its customers to make alternative arrangements. Meanwhile the company continues to focus on improving new product development capability. In financial year 2011, the new products contributed around 20% to the total revenue of Kalyani Forge. During the financial year the company formed a technological partnership with Japan-based ZenoTech. The partnership gives Kalyani Forge access to the latest technology in cold forging areas in both die making and product manufacturing. This further enhances Kalyani Forges manufacturing efficiency in this area. Joint-ventures In 2011, Kalyani Forge signed a technological transfer alliance agreement with Japan-based ZenoTech in the field of cold forging. Investments In 2006, Kalyani Forge opened a forging unit for the production of die forgings and machined components at Sanaswadi, near Pune, Maharashtra (India) at an investment of INR250m (USD5.7m, 31 March 2006). Contracts Kalyani Forge is a single source supplier of specific forgings to Lombardini, Same Deutz-Fahr (Italy), Trelleborg Automotive (UK & Germany), Hero, Tata Motors, TVS Motor and GKN Driveline India. Certifications In 2005, Kalyani Forge was accredited with TS16949:2002 certification. New Product Developments For the year ended 31 March 2011, Kalyani Forge spent INR3.6m (USD79,300) on research and development (R&D) activities, an increase of 56.5% from INR2.3m (USD51,080) in the previous year. The R&D expense during financial year 2011 was 0.2% of the companys sales during the financial year. During the financial year the company entered into a technical
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transfer alliance with Japan-based ZenoTech Corporation. Kalyani Forge is focusing its R&D activities on improving die life, die down time and reduction in raw material utilisation. The company expects its ongoing new product development activities to translate into more business opportunities in coming years. Financial Overview In the financial year ended 31 March 2011, Kalyani Forge reported net sales of INR2.3bn (USD50.9m, 31 March 2011), an increase of 42.4% from INR1.6bn (USD36m, 31 March 2010) in 2010. The strong growth in sales was driven by increased demand of products from its customers during the financial year. In addition, utilisation in assets in machined shop improved, leading to supply of value added forgings to customers. Higher sales led the company to report a 70.7% increase in profit before tax (PBT) to INR101.4m (USD2.2m) compared with INR59.4m (USD1.3m). During the year Kalyani Forge modified its product mix so as to exclude dies with high material consumption. The company concluded the financial year with net profit of INR64.5m (USD1.4m), 94.9% over INR33.1m (USD0.7m) in 2010. For the financial year ending 31 March 2012, Kalyani Forge is expecting its sales to grow at around 15%, higher than expected increase of 10% in turnover by the automotive industry, the mainstay business of the company. The company expects profits to record higher growth than sales, given its continuing focus on streamlining costs in the past few years. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 2,309.0 1,620.4 1,611.6 1,931.2 1,839.0 Net Sales (USDm) 50.9 36.0 30.9 48.4 42.3 Profit Before Tax (INRm) 101.4 59.4 20.3 148.0 168.0 Profit Before Tax (USDm) 2.2 1.3 0.4 3.7 3.9 Net Profit (INRm) 64.5 33.1 9.3 94.2 110.5 Net Profit (USDm) 1.4 0.7 0.2 2.4 2.5
Outlook With the double-digit growth in the Indian automotive industry in the past couple of years, Kalyani Forge is optimistic about the rising opportunities in the country. Almost all the major automakers have plans to set up manufacturing units in India, especially in the small and mid-segment vehicles. Also, the company will benefit from the cost-control measures implemented in the past few years which have helped it create a leaner cost structure. This is expected to help the company to improve its margins in coming years.
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Kinetic Engineering
Engine & transmission components
Address Kinetic Engineering Limited Kinetic Innovation Park D1 Block, Plot No. 18/2 MIDC Chinchwad, Pune- 411 019 Maharashtra India Tel: + 91 20 66142049 Fax: + 91 20 66142088/89 Website: http://www.kineticindia.com Senior Officers Arun H. Firodia, Chairman Saluja Firodia Motwani, Vice-Chairman Ajinkya Firodia, Managing Director Ashish Kumar, Director Products Axles, cam shafts, connecting rods, crankshafts, cylinder blocks, cylinder heads, flywheel magnetos, gear box assembly, gears, boxes, housing & covers, precision parts, shafts, sheet metals, tubular frame assembly, wheels Plants India (1): Maharashtra Sales INR911.7bn (USD20.1m, 31 March 2011) (Year to 31.03.11) Employees c. 1,276 (31 March 2011)
Kinetic Engineering is the flagship company of the Firodia Group. The company is engaged in the production of components for engines and transmissions. In addition to automotive, the company supplies to non-automotive segment such as tractors, recreational products and construction equipment.
Established in 1972, Kinetic Enginerring operates only one manufacturing plant in India which is located in Ahmednagar, Maharashtra. The company manufactures powertrain components including engines, gears, gearboxes and shafts for two-wheelers, passenger cars and commercial vehicles. In financial year 2011, the company produced 23,275 steering arms/slip yokes, 463,802 gearboxes/shaft drives, 12,836 internal combustion (IC) engines and 73,483 units of variators. Kinetic Engineering generated 39% of its 2011 sales from transmission, 35% from engine parts, 5% from body shop and 21% from components for non-automotive segment. The company supplies its products to Force Motors, Mahindra & Mahindra and Tata Motors. In addition to the domestic market the company aslo exports its products to North America and Europe. In financial year 2011, the company generated 82% of its sales from India, 11% from the US and 7% from Europe. In December 2011, the Board of Directors of Kinetic Motor Company Limited (KMCL), another company of Firodia Group, approved its merger with Kinetic Engineering. The proposed share ratio for the merger is 7.75:1, meaning that Kinetic Motors shareholders will receive four share of the merger Kinetic Engineering for every 31 shares of former. Following the merger, the promotors stake in Kinetic Engineering will dilute from 57.49% to 52.85%. The balance shareholding will be with public and financial institutions.
Recent Developments
Corporate strategy Kinetic Group completed its restructuring, as part of which the Group decided to hive off its two-wheeler business Kinetic Motor to Mahindra & Mahindra for cash and a 20% stake in the new company, Mahindra Two-Wheeler Limited (MTWL). The second stage of restructuring is the merger of Kinetic Motor with Kinetic Engineering announced in December 2011. Following the merger, Kinetic Engineering will have two operating divisions Auto System and Investment. The Auto System division will focus on auto component business while Investment division will manage its investment in MTWL. Kinetic Engineering is focusing on the powertrain segment, especially on transmissions. In January 2012, the company announced plans to launch two new gearboxes for two automakers operating in India. The company has developed its first gearbox for Piaggio Appe Druk four-wheeler, which is based on a completely new platform. Kinetic Engineering has developed the second gearbox for Mahindra Navistar which is expected by the end of financial year 2012. The company is supplying complete shaft, gears and transmission systems to the Tata Nano. Kinetic Engineering has invested INR600m (USD11.6m) in its manufacturing plant in Ahmednagar, Maharashtra (India) from where it is currently supplying to Tata Motors Nano assembly plant in Sanand, Gujarat. The company is currently under discussion with the automaker to set a dedicated plant at Sanand to supply the Tata Nano. Acquisitions In December 2011, the Firodia Group announced the merger of Kinetic Enginiering and Kinetic Moter. Post-merger, Kinetic Engineering will have two operating divisions Auto System and Investment. The Auto
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System division will focus on auto component business while Investment division will manage its investment in MTWL. In October 2009, Kinetic Engineering merged the investments and auto components division of Jaya Hind Sciaky (JHSL).
Investment In 2009, Kinetic Engineering invested INR600m (USD12m) in a production line at its Ahmednagar plant in Maharashtra (India) to supply complete shaft, gears and transmission components to Tata Nano. Divestments In December 2009, Kinetic Engineering sold off its plant in Chinchwad, near Pune, Maharashtra (India) for INR440.7m (USD9.3m, 31 December 2009). The proceeds from the same have been used to pay debts. In December 2006, Kinetic Engineering divested its two-wheeler manufacturing Unit, Supa Undertaking on slump sale basis to Kinetic Motor for INR535m (USD12.1m, 31 December 2006). Kinetic Motor also allotted redeemable preference shares worth INR300m (USD6.7m) to Kinetic Engineering. Contract Kinetic Engineering has a contract to supply gear boxes for Mahindra Navistar. Kinetic Engineering has contract to supply the Piaggio Appe Druk fourwheeler. Kinetic has a contract to supply gearboxes for the Tata Nano. Certification Kinetic is accredited with TS 16949 status for manufacturing systems. New products development The company spent INR6.9m or 1.4% of its total sales on research and development as on 31 March 2010. In January 2012, Kinetic Engineering disclosed plans to launch two new gear boxes for the Piaggio Appe Druk four-wheeler and Mahindra Navistar.
Financial Overview In the financial year ended 31 March 2011 Kinetic Engineering reported net sales of INR909.3m (USD20m, 31 March 2011) compared with INR490.6m (USD10.9m, 31 March 2010). The financial year 2010 includes the companys performance for only nine months against 12 months in 2011. Despite higher sales Kinetic Engineering incurred pre-tax loss of INR109.3m (USD2.4m) against profit before tax (PBT) of INR23.5m (USD524,090) in the previous financial year. The company concluded the financial year with net loss of INR109.3m (USD2.4m) against net profit of INR23.5m (USD524,090) in 2010. Net Sales Profit Before Net Profit (INRm) Tax (INRm) (INRm) 2011 909.3 (109.3) (109.3) 2010* 490.6 23.5 23.5 2009* 645.7 (313.3) (379.6) Note: Financial year 2010 comprises nine months and 2009 consist of 15 months. Year 2011 2010 2009 Net Sales (USDm) 20.0 10.9 12.4 Profit Before Tax (USDm) (2.4) 0.5 (6) Net Profit (USDm) (2.4) 0.5 (7.3) Year
Outlook Kinetic Engineering remains bullish on the growth outlook of the Indian automotive industry despite a slowing down in vehicle demand in the past few quarters. The company mainly caters to two-wheelers, three-wheelers and commercial vehicles which have not witnessed sharp decline in demand as with passenger cars. In the automotive industry the company is focusing on the powertrain segment which is expected to see better quality engines and
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transmissions to meet growing requirements in reduction of both fuel consumption and vehicle emissions.
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Krishna Maruti
Interior trims and seats
Address Krishna Maruti Limited 40 KM Stone Hero Honda Chowk NH-8 Delhi-Jaipur Highway Village Narsinghpur Gurgaon, 122001 Tel: +91-12 4237 1461 Fax: +91-12 4237 1631 Internet: http://www.krishnamaruti.com Senior Officers Ashok Kapur, Chief Managing Director Sunandan Kapur, Joint Managing Director A.K. Bedi, Executive Director, Operations P. Soni, Executive Director, Finance G.P. Singh, Chief Operating Officer , KML Door Trim Division V.K. Bhatti, Chief Operating Officer, Krishna Group Ram Natarajan, Executive Director, Mark Auto India Girish Rakhe, Executive Director, SKH Auto Products Arm rest assemblies, plastic injection moulded door trims, head rest assemblies, injection molded door trims, injection molded parts, rear view mirrors, roof liners and molded carpets, seating systems, seat trims Plants Gurgaon, Manesar (3) Sales INR9.67m (EUR213m, 31 March 2011) Employees c.1200 (31 March 2008)
Krishna Maruti is a major supplier of interior trims and seats to Maruti Suzuki. The company claims to have a third of the market share in seats, armrests and headrest categories in the country. The company entered into the business of sheet metal components with the acquisition of Mark Auto in 2005.
Krishna Maruti Limited (KML) is a Maruti associate vendor set up in 1994 to cater to the special needs of Maruti. Both Maruti and Suzuki have separate stakes in the company, amounting to 15.8% and 29.2% respectively. Indian promoter Ashok Kapur holds a 37.5% stake in the joint-venture. Krishna Maruti has four manufacturing facilities, the most important of which is located close to the Maruti plant in Haryana and undertakes seat manufacturing. The company has the following business units: Krishna Maruti Ltd. (KML) manufactures seats and door trims for Maruti Udyog. Krishna Groupo Antolin manufactures roof liners KML (Moulded carpets division)
Krishna Maruti Ltd has the following sister concerns: SKH Metals manufactures exhaust systems and allied components, fuel tanks and front suspension. SKH Auto Components manufactures seat trims. Krishna Toyo Ltd. manufactures a large number of inside and outside rear view mirrors for Honda Siel Cars India Ltd and Maruti Udyog Ltd. The unit enjoys a 35% market share. Krishna Pads Ltd. manufactures headrests and armrest assemblies for all models of Maruti car. In 2011, seat sets accounted for 76% of total revenues, door trims accounted for 17% and the remainder was contributed by non-door trim components. The company makes seats for the Omni, Zen, A- Star, SX4, Swift, Swift Dzire, Alto and Eeco and has a 59% share in Maruti's seats business. Its major customers include Maruti Suzuki India., Honda Siel, International Cars and Motors Limited, GM and Ford. SKH Metals, formerly known as Mark Auto Industries, was established in 1986 as a joint-venture company set up by Maruti Suzuki India Limited, the largest car manufacturer in India, to cater to its requirements of Fuel Tanks and other Sheet Metal parts. In 2005, the company was taken over by the Krishna Maruti Group and renamed SKH Metals Ltd. Since then the company has broadened its horizons to become a reckoning force within the industry. Recent Developments Corporate strategy Krishna Maruti has been one of the most aggressive vendors in the Maruti vendor group. The company has successfully added a number of non-Maruti clients to its customer base and has won significant business in North America and Europe. On a standalone basis, KML generated 96% of its revenues in 2011 from Maruti Suzuki. The group has been diversifying into new areas, adding new products to its portfolio and expanding production capacity. In February 2008, Sister concern SKH Metals formed a joint-venture with Magneti Marelli for exhaust systems. The company is also seeking joint-ventures for chassis systems, sheet metal components and injection mouldings. In 2011, Krishna Maruti announced plans to invest INR250m (USD5.5m, 31 March 2011) to expand production
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capacity of seat and door trim products. In recent years the company has worked at backward integration to bring its suppliers closer. It set up Krishna Pads Ltd in 1996 to manufacture head rest and arm rest assemblies and is the single source for Krishna Maruti. Krishna Pads is also India's largest manufacturer of head rest arm rest assemblies. Krishna Maruti also started Krishna Trims Ltd in 1996. The company claims to be India's largest seat cover manufacturing company with a capacity of 200,000 sets per annum. Again most of the production is supplied to KML. Krishna Maruti owns 10% each in Krishna Pads and Krishna Trims. Joint-ventures In 2011, Krishna Maruti announced plans to invest INR250m (USD5.5m, 31 March 2011) to expand production capacity of seat and door trim products. In February 2008, SKH Metals formed a joint-venture with Magneti Marelli to manufacture exhaust systems and chassis systems, sheet metal components and injection mouldings for the automotive industry. Krishna Maruti has a technical collaboration with SNIC which is a jointventure between Suzuki and NHK for seats. There is a joint-venture with Suzuki Kasai for door trims. The tie-up for headliners is with Groupo Antolin, with the Spanish giant holding a 50% stake. The company also has a technical and financial tie-up with Toyo for mirrors. Toyo holds 50% stake in Krishna Toyo. Investments In January 2006, Krishna Maruti announced plans to invest INR500m (USD11.3m, 31 January 2006) to increase production capacity of its injection moulding and the roof liner divisions at three of its facilities, with the majority being planned in Binola (Rajasthan). Of the total investment amount, about INR70-80m (USD1.6-1.8m) was for capacity expansion of seating products in a single shift operation. The expansion doubled the companys production capacity of seats from 1,300 units in a single shift. Contract In June 2008, Krishna Maruti announced that it had been chosen by Chrysler to supply seats to the Jeep Wrangler programme. Krishna Maruti supplies seats to the Maruti Suzuki SX4 programme. Krishna Maruti supplies seats to the Maruti Suzuki Zen Estilo programme. Krishna Maruti supplies seats to the Maruti Suzuki A-Star programme. Krishna Maruti supplies seats for the ICML Rhino Rx. Krishna Maruti makes seats for Maruti 800, Alto, Omni and Wagon R. Krishna Maruti also manufactures door trims for the Alto, Wagon R and Zen Estilo. Krishna Toyo Ltd. further supplies mirrors for all models in the Maruti stable and certain models of Honda Siel. The company also supplies carpets for the Alto and the Wagon R. Certifications Krishna Maruti has been awarded the Deming Prize for quality, the only seat manufacturer in the world to win the award. The company has also been certified with TS 16949, ISO14000 and OHSAS 18000 certifications. New Product Developments Krishna Maruti has a dedicated R&D centre set up with an investment of USD1.5m. The company claims that the centre is capable of conducting tests according to European Homologation (EEC/ECE/FMVSS) and Japanese Standards (JASO) on not only automotive seating systems but also on other components wherein repeatability and endurance life have to be ascertained. The set-up includes Vibration Test Rig, Free Flight Impact Test Rig and Static/Dynamic Strength Test Rig. This centre is capable of not only testing according to International Standards, but also of issuing Test Certificates to other seat manufacturers. This test centre can also perform tests for nonautomotive components for endurance and repeatability.
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The company is doing its own independent research on seats and has developed the 'Easy Seat', meant for the physically disabled people where the co-passenger seat rotates outwards while moving forward. Financial Overview In the financial year ended 31 March 2011, sales of Krishna Maruti group totalled INR9.67bn (USD213m, 31 March 2011), up 11.3% from INR8.69bn (USD192.9m, 31 March 2010) in the previous year. The companys operating profit before depreciation, interest and tax increased 4% to INR541m (USD11.9m) compared with INR520m (USD11.5m) in the previous year. Profit after tax increased 15.5% to INR179m (USD3.9m) against INR155m (USD3.4m) a year ago. Year Sales Operating Profit Profit after tax (INRm) (INRm) (INRm) 2011 9,674 541 179 2010 8,693 520 155 2009 6,337 467 (156) 2008 5,218 398 130 2007 3,952 252 110 Year 2011 2010 2009 2008 2007 Sales (USDm) 213.0 193.0 121.5 130.8 90.9 Operating Profit (USDm) 11.9 11.5 8.9 9.9 5.8 Profit after tax (USDm) 3.9 3.4 (2.9) 3.3 2.5
Outlook Krishna Maruti has made significant achievements in the last five years towards achieving its aim of being a total automotive interiors solution provider. Having significantly de-risked its client base, Krishna Maruti Groups plan of entering new product areas is a bold challenge with an uncertain economic situation. Despite this, Krishna Maruti has positioned itself as a strong supplier with the Jeep Wrangler contract, a first for any Indian interiors manufacturer. Since Maruti Suzuki remains the primary customer to Krishna Marutis revenues, the formers performance and prospects are closely linked to those of Krishna Maruti.
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LG Balakrishnan
Automotive chains and metal formings
Address LG Balakrishnan & Bros Ltd Krishnarayapuram Road Ganapathy Coimbatore -641 006 Tel: +91 422 253 2325 Fax: +91 422 2532333 Website: http://www.lgb.co.in Senior Officers B Vijayakumar, Chairman & Managing Director N. Rengaraj, CFO P Prabhakaran, Deputy Managing Director Products Automotive chains, brake shoe, belts, fine blanking products, machined components, sprockets, tensioners, and wire drawing Plants India (9) Sales INR7bn (USD154.1m, 31 March 2011) (Year to 31.12.2011)
LG Balakrishnan (LGB) is a leading supplier of automotive and industrial chains and metal formings in the domestic market.
The company came into being in 1937 as a transport operator and bus/truck body builder. In 1966, the company initiated timing chain manufacturing operations under an alliance with Germany based John Winklehofer. After the collaboration, LGB became the first Indian company to supply timing chains to four-wheeler OEMs in India. LGB entered into steel strips and wire rods manufacturing in the 1970s. The company added three subsidiaries, Combined Industrials Ltd, LGB Engineering Works and Super Engineers Limited during the 1970s and 80s. LGB Engineering Works was later merged with the company. During the late 80s, LGB entered into a technical know-how agreement with Japan based Daido Kogyo to supply drive chains and cam chains to all twowheeler OEMs in India. The company markets its chain under the brand name "Rolon". In the 1990s the company entered the hot, cold and warm forming segment. In 1994, LGB established a chain manufacturing facility at Vaiyampalayam (Tamil Nadu). Subsequently the company ventured into rubber belts, aluminium bus bodies and wind energy systems. In 1997, LGB Industries and the steel division of LGB Automotive Services was amalgamated into LGB. Recently, LGB began its cold and hot forging operations. In June 2008, Renold acquired 75% stake in LGBs chain business. Presently the company classifies its operations under three strategic business units: Transmission: offers chains, sprockets, tensioners, belts and brake shoe Metal forming: manufactures hot, warm and cold forging, blanking, fine blanking, wire drawing and precision machined parts. Others: includes rubber belts LGM operates total nine plants in India of which one is located in Karnataka and the other eight in Tamil Nadu. LGB's domestic OEMs and tier one customers include Bajaj Auto, Force Motors, Hero Honda, HMSI, Kinetic Engineering, TVS Motors and Yamaha. The company supplies fine blanking products to Aditya Auto, Bajaj Auto, Brakes India, Hero Honda, Kalyani Brakes, Kinetic Engineering, Larsen & Toubro, LML, Mico and TVS Motors. LGB supplies forged components to Brakes India, Delphi, Denso, GKN, Visteon, Kalyani Brakes, Lucas TVS, Mico, Rane and Sona Steering. LGB exports its products to Australia, Bangladesh, Colombia, France, Germany, Greece, Hong Kong, Indonesia, Iran, Italy, Japan, Luxembourg, Malaysia, New Zealand, Poland, Puerto Rico, Singapore, Slovenia, South Africa, South Korea, Sri Lanka, Turkey, UAE, UK, Uruguay, USA and Vietnam.
Employees
2,038 (Year to 31 March 2011)
Corporate strategy In recent years LGB has made substantial improvements in forging and machining businesses, following which the company spun off these operations into a special vehicle to facilitate strategic initiatives including acquisitions. The company has also made various acquisitions and announced investments into new plants to grow its blanking business. LGB has listed exports as a principal growth driver and has plans to establish itself as a leading player for fine blanking and forged components akin to its leadership in chain exports. The sale of LGBs chain division to Reynold will help the business to become a principal source for Reynolds global sourcing.
Recent Developments
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LGB is following an expansion strategy recognising the need to boost production amid increased demand. In financial year (FY) 2011, the company invested around INR672.7m (USD148m, 31 March 2011) for capacity expansions, quality and productivity improvements. The company added five new manufacturing facilities in 2010. For the year 2011-12, LGB has budgeted INR350m (USD7.7m) for expansion related activities. Investments In March 2006, LGB announced its plan to invest INR1.5bn (USD34,254 , 31 March 2005) to set up new facilities and capacity expansions. It announced investing into a new forging plant in Coimbatore (Tamil Nadu) with forging machinery imported from Korea and Japan. The plant commenced operations at the end of 2006. Further, LGB established two chain plants in Pune (Maharashtra) and Uttaranchal. The company has set up a new facility for producing cold forgings at K Palayam (Tamil Nadu). Certifications LGBs fine products and forging division is certified ISO/ TS 16949 & ISO 9001 status. The Annur (Tamil Nadu, India) based plant is ISO/ TS 16949 and ISO 9001 certified. The Vaiyampalayam (Tamil Nadu, India) plant is accredited ISO/TS 16949 & ISO 9001 certificates. Gudalur (Tamil Nadu, India) based industrial chains facility is ISO 9001 certified. Mysore (Karnataka, India) based drive chain plant is accredited ISO/ TS 16949 & ISO 9001 status. LGBs machined component division is ISO 9001 certified. LGBs rubber belt division and wire drawing division have also been accredited ISO 9001 status. Contracts The company exports hydraulic drive to Parker Hannifin. New Product Developments LBG spent INR22.3m (491,213, 31 March 2011) or 0.29% on research and development in FY 2010. Financial Overview In the financial year ended 31 March 2011, LGB reported net sales worth INR7bn (USD154.1m, 31 March 2011) an increase of 28.4% from previous year's figure of INR5.5bn (USD122.1m, 31 March 2010). Of the total sales, INR6.6bn (USD145,380) was generated from India, while the remaining INR478.4m (USD10.5m) came from international markets. Profit before tax was reported at INR472.9m (USD10.4m) 28.7% higher over previous years operating profit of INR367.4m (USD8.1m). Profit after tax was up 84.5% to INR458m (USD10m) in 2011 from INR248.3m (USD5.5m) in 2010. Segment wise, Transmission segment reported a 32.2% increase in sales to INR4.6bn (USD101.3m) compared with sales of INR3.4bn (USD75.5m) in FY 2010. Sales of Metal Forming segment were INR1.4bn (USD30.8m), up 19.4% from INR1.2bn (USD26.6m). Others segment increased from INR807.1m (USD17.9m) to INR1bn (USD22m) in 2011. Year Net sales (INRm) 7,095.2 5,523.7 5,076 5,498.73 4,755.81 Operating Profit (INRm) 750.74 843.43 Profit Before Tax (INRm) 472.9 367.4 450.1 180.53 369.9 Net Profit (INR m) 458 248.3 391.4 148.62 229.6
2011 2010 2009 2008 2007
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Year
Net sales (USDm ) 156.2 122.6 97.2 137.8 109.4
Operating Profit (USDm) 18.8 19.4
2011 2010 2009 2008 2007
Net Profit (USDm) 10 5.5 7.5 3.7 5.2
Outlook Having divested its non-core subsidiaries LGB has restructured its remaining businesses. LGB has undertaken capacity expansion plans with a view to fulfilling the burgeoning demands from its current customers. The company also opened five new facilities in 2010 which will help it further expand its business with new customers.
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Lucas TVS
Automotive electricals
Address Lucas-TVS Limited AALIM Centre, 2nd Floor, 82, Dr. Radhakrishnan Salai, Mylapore, Chennai - 600 004 Tamil Nadu India Tel: 91 44 2811 0063/0074 Fax: +91 44 2811 5624 Website: http://www.lucas-tvs.com Senior Officers TK Balaji, Managing Director Arvind Balaji, Joint Managing Director N Ravichandran, CEO AS Ravi, CFO S. P. Ramarathinam, Chief Operating Officer of Operations Products Alternators, blowers/fan motors, ignition products, small motors, starter motors, wiper motors Plants India (6); Haryana, Maharashtra, Puduchery (2), Tamil Nadu, Uttarakhand Sales INR16.9bn (USD372.3m, 31 March 2011)
Lucas-TVS is a joint-venture between UK-based Lucas and the TVS group. The company is a leading manufacturer of automotive electrical components in India.
Lucas TVS was established in 1961 as a joint-venture between UK-based Lucas Industries and the TVS Group for the manufacture of automotive electrical systems. The company makes alternators, blower/fan modules, ignition, small motors and wiper motors. The company is a flagship business unit of the Lucas-TVS Group. In addition, the group operates following subsidiaries. Delphi-TVS : a joint-venture between Delphi Automotive and Lucas TVS. The JV supplies diesel fuel injection components for passenger cars and commercial vehicles. The JV product portfolio includes both direct and indirect injection components. The company operates three manufacturing plants in India two in Mannur and Orgagadam Tamil Nadu and one in Pantnagar, Uttarakhand. India Nippon Electricals: a joint-venture with Japan based Kokusan Denki. The JV manufactures electronic ignition systems for two-wheelers, and portable gen-sets. The company operates a manufacturing plant in Hosur, Tamil Nadu (India). Indo Japan Lighting: a joint-venture between Lucas TVS and Japan-based Koito Manufacturing. The company supplies headlamps, fog lamps, front turn signal lamps, high mount stop lamps, licence plate lamps, rear combination lamps and side turn signal lamps from its manufacturing plant near Chennai, Tamil Nadu (India). Lucas India Service: engaged in sales and service of auto electricals and fuel-injection equipments manufactured by Lucas-TVS. The company has four regional offices one each in Delhi, Mumbai, Chennai and Kolkata and 22 branch offices covering almost all the states in the country.
Lucas-TVS operates six plants in India of which two are located in Puducherry and one each in Rewari, Haryana; Chakan, Maharashtra; Maraimalai Nagar, Tamil Nadu and Pant Nagar, Uttarakhand. The company supplies its products to two-wheelers, three-wheelers, passenger cars, commercial vehicles and off-the road (OTR) vehicles. The company's domestic customers include Ashok Leyland, Fiat India, Force Motors, Cummins India, Eicher Motors, Ford India, GM India, Hindustan Motors, Hyundai Motors India, International Cars & Motors, Mahindra & Mahindra, Man Force Truck, Maruti Suzuki, SML Isuzu, Tata Cummins and Tata Motors. In addition to the domestic market the company has significant export presence. The company's export customers include Arctic Cat (USA), Commercial Vehicle Group, Cummins, Denso Manufacturing (Italy), Iveco, Proton, Motori Minarelli and WABCO.
Employees
2,500 (March 2011)
Corporate strategy Lucas-TVS has set a financial goal to achieve sales of INR35bn (USD770m, 31 March 2011) by 2015, with around one-third of its sales coming from exports. To meet this goal the company is focusing on expanding its business through entering into strategic alliances with global suppliers. In October 2011, the company announced a business co-operation agreement with Remy International which enables cross-technology licence, product sales and engineering support and component sourcing support between the two suppliers. In a bid to achive the desired sales level, the company is aggressively focusing on new product development which will help its customers improve fuel effeciency and reduce emissions. In this regard, the company developed Stick Coil which is a new-generation ignition coil which increases fuel efficiency and reduces vehicle emissions.
Recent Developments
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Another strategy that Lucas- TVS is adapting to improve its prospects is entering new markets to counter the perceived threat from other Asian players. To this end, Lucas TVS e xp a nd ed its footprint in Iran and China. In the domestic market the company is expanding its product offerings. This is highlighted by the acquisition of Indrad Autos assets in 2008 which brought additional electrical components to the companys offerings. Acquisition In August 2008, Lucas-TVS acquired Indrad Autos manufacturing facility and other assets from near Chennai, Tamil Nadu (India) from Sical Logistics for a consideration of INR146.9m (USD3.3m, 31 August 2008). The acquired company manufactures auto electrical and other components under technology agreements which have been retained by Sical through Indrad. Joint-venture In October 2011, Lucas-TVS entered into a business co-operation agreement with Remy International which includes cross-technology licences, product sales, engineering support and supplier sourcing support. The agreement will allow Remy to license certain products from LucasTVS for Remy to manufacture and sell around the world. Lucas-TVS will license certain Remy products to make and sell in India. In addition, both parties may buy and resell each other's products. Investment In September 2007, Lucas-TVS announced plans to invest INR4bn (USD100.5m, 30 September 2007) over the next two to three years in an attempt to double its sales. The company will invest in capacity expansion and research and development (R&D). The company was also open to selective acquisitions to strengthen its presence in automotive electrical business. Contracts In September 2007, Lucas-TVS secured a contract to supply starters worth EUR1m (USD1.4m, 30 September 2007) to Russian truck manufacturer KamAZ. In 2007, Lucas-TVS announced that it was supplying starters for snow mobile vehicles to a US OEM, wipers to Iveco and wiper motors to Commercial Vehicle Group. In 2007, Lucas-TVS announced that it had won a contract to supply starter motors and other components for Tata Nano. Certifications In 2007, Lucas TVS was awarded the JIT Grand Prix from Japans JIT Management Laboratory Company for the second time. Lucas-TVS manufacturing facilities are accredited with TS16949 and ISO14001 accreditations. New Product Developments In April 2010, Lucas-TVS, introduced Stick Coil, a new generation high energy ignition coil which increases a vehicle's fuel efficiency and reduces emissions. The company explains that the stick coil is integrated with an ignitor inside the coil and generates a high voltage to the spark plug based on a signal from the engine ECU. The company manufactures Stick Coil at its plant in Rewari, Haryana (India). In 2008, Lucas-TVS developed gear reduction transfer motors with a range from 0.8kw to 9kw. The company already supplied gear reduction transfer motors of a range up to 2kw. The new range is developed for passenger cars, commercial vehicles and heavy trucks. Financial Overview In the financial year ended 31 March 2011 Lucas-TVS recorded a 30% increase in sales to INR16.9bn (USD372.3m, 31 March 2011) compared with INR13bn (USD288.7m, 31 March 2010) in the previous financial year. Lucas-TVS is a privately held company of the TVS Group and therefore does not announce details of its financial performance. Outlook Lucas-TVS has recorded strong growth in the past six years with its sales more than doubling to INR16.9bn (USD372.3m) compared with INR6.3bn (USD145m) in 2004-05. The company has benefited from strong
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growth of the automotive industry in India during this period. The strong growth in the past six years has strengthened the companys confidence as it further expects to double its sales to INR35bn by (USD770m) by financial year 2015. The company is concentrating on increasing its product portfolio and its recent strategic agreement with Remy International is the right initiative to launch products in the Indian market. The company has also increased its sales activities in Malaysia, China, Thailand and west Asia. These initiatives are expected to help the company improve its financial performance in the coming years.
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Lumax Automotive Systems

Automotive mirrors
Address Lumax Automotive Systems Ltd 99 Udyog Vihar Pahse-IV, Gurgaon Haryana, 122016 India Tel: + 91 124 4551 000 Fax: Website: http://www.lumaxauto.com Senior Officers UK Jain, Chairman Nitin Jain, Managing Director Milan Jain, Executive Director Prem Das Gandhi, Director Vinay Panchmia, Director Products A/C ducts, air filter case caps, automotive mirrors, clusters, coolent bottles, engine ducts, instrument panels, mudflaps, petrol tanks, resonators, set inner boxes, and weather strips Plants India (6): Haryana (3), Maharashtra (3) Sales INR1.1bn (USD24.5m, 31 March 2011) (Year to 31.03.11)
Lumax Automotive Systems is a major supplier of air filters and automotive mirrors in India. In addition, the company makes plastic components for the automotive industry.
In 2003, Lumax Industries demerged some of its product lines to focus on its core business of lighting. The company spun off its mirrors, filters and plastic components business into a separate unit called Lumax Automotive Systems. Lumax Automotive Systems currently operates six manufacturing plants in India of which three are in Haryana and three in Maharashtra. The company supplies its products to two-wheelers, three-wheelers, passenger cars, lightand heavy-duty commercial vehicles, tractors and earth moving equipment. Lumax Automotive Systems has a technical agreement with Toyo Roki for filters. The companys major customers include Ashok Leyland, Daimler, Eicher, Fiat, Ford, GM, Hindustan Motors, Honda Seil Cars, Hyundai Motors, John Deere, Mahindra & Mahindra, Maruti Suzuki, Nissan, Piaggio, RenaultNissan, SML Isuzu, Tata Motors, Toyota and Volvo. The company also supplies to two-wheelers such as Bajaj, Hero MotoCorp, Honda Motorcycle India, and Yamaha.
Recent Development
Corporate strategy Since its demerger from parent company, Lumax Industries, in 2003, Lumax Automotive Systems has been mainly pursuing growth through entering into strategic partnerships with established global suppliers. This led the company to enter into a joint-venture (JV) agreement with Magna Donnelly in 2005 to supply rear view mirrors to automakers operating in India. The JV enabled the company to penetrate the rear view market for the premium car segment, which required advanced technology. However, the company decided to terminate the JV in 2011. The shift from foam filters to paper filters helped the company to establish a lead market for its products with various supply programmes. The company has received significantly large orders from two-wheeler manufacturers and is expecting more orders from large players such as Maruti Suzuki. Divestments In March 2011, Lumax Automotive divested its stake in its joint-venture company named-Lumax Magana Donnelly Automotive Mirrors Private Limited. The joint-venture was formed in 2005 between Lumax Automotive and Magna Donnelly to manufacture mirrors of passenger vehicles and inner door handles. Contracts Lumax is the sole supplier of filter systems to Suzuki and Honda in India. Lumax supplies mirrors for the Mahindra & Mahindra Bolero. The company also supplies mirrors for the tractors produced by the company. The company supplies side view mirrors for the Tata Indica programme. Lumax supplies filter systems for all passenger car. LCV and HCV models in the Tata stable. Lumax is the sole supplier of filter systems to the Maruti 800 programme. Certification Lumax Automotive Systems has been accredited with ISO/ TS 16949, QS: 9000 and ISO: 9000. Financial Overview In the financial year ended 31 March 2011, Lumax Automotive Systems reported a 10.7% increase in sales to INR1.1bn (USD24.5m 31 March 2011) compared with INR1bn (USD22.3m, 31 March
Employees
c. 705 (Year to 31.03.2008) last known figure
304
2010) a year earlier. The company benefited from strong demand for its products during the financial year. Strong growth in sales led the company to turn around its earnings. The company reported profit before tax of INR12.6m (USD277,550) compared to loss before tax of INR37.7m (USD837,218) in 2010. The company achieved net profit of INR9.7m (USD213,667) after incurring losses of INR34.9m (USD.75,037) in FY2010. Years 2011 2010 2009 Years 2011 2010 2009 Sales (INRm) 1,111.7 1,004.8 1,000.4 Sales (USDm) 24.5 22.3 19.2 Profit Before Tax(INRm) 12.7 (37.7) 15.0 Profit Before Tax(USDm) 0.3 (0.8) 0.3 Net Profit (INRm) 9.7 (35) 8.5 Net Profit (USDm) 0.2 (0.8) 0.2
Outlook Lumax Automotives strategy of tapping international alliances has helped the company make a significant move forward. In particular, the companys JV with Magna Donnelly had made reasonable progress in the past five years and had secured contracts from automakers operating in India, including Maruti Suzuki. However, Lumax Automotives decision to divest its stake in the JV could affect its performance in the mirror business resulting in loss of certain customers, to whom it supplied under the alliance. However, the company expects to make up this loss through securing business from other automakers.
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Lumax Industries
Lighting systems
Address Lumax Industries Limited B-86, Mayapuri Industrial Area, Phase-I New Delhi- 110064 India Tel: +91 11 2811 1777/5709/6990 Fax: +91 11 2811 3631/5779 Website: http://www.lumaxindustries.com Senior Officers DK Jain, Chairman & Managing Director Deepak Jain, Senior Executive Director Anmol Jain, Senior Executive Director Naval Khana, Group Finance Director Prem Pardasani, Vice-President, New Product Development BS Bhadauriya, Vice-President, Legal & Company Secretary Products Auxiliary lamps, headlamps, sundry lamps, tail lamps Plants India (6): Haryana (2), Maharashtra (2), Uttrakhand (2) Sales Group: INR8.6bn (USD189.6m, 31 March 2011) (Year to 31.03.2011)
Lumax Industries is the leading supplier of automotive lighting systems in India with more than 60% market shares. The company supplies headlamps, taillamps and auxiliary lamps to two-wheelers, passenger cars, commercial vehicles and off-the road vehicles.
Lumax Industries began as a trading company in 1945. However, ten years later the company diversified in the area of manufacturing automotive lighting systems. Later the company broadened its product offering through commencing production of automotive filters, mirrors and other plastic components for the automotive industry. In a major development in 2003, Lumax hived off its plastic moulding, mirror and filter business units into a separate company in order to focus on its core business of automotive lighting. The divested business now operates under a new company called Lumax Automotive Systems. On 30 September 2011 the Indian promoters, led by DK Jain and family, held a 36.18% equity in Lumax Industries, Japan-based Stanley Electric held a further 37.5% stake. The remaining 26.32% is owned by public and corporate bodies. Lumax also has a technical alliance with Stanley Electric. Lumax operates total six manufacturing plants in India of which two each are located in Gurgaon, Haryana; and in Pune, Maharashtra and one each in Pantnagar and Haridwar, both in Uttrakhand. In addition, the company is establishing new plants in Bangalore, Karnataka; Bawal, Haryana and Sanand, Gujarat. In the financial year ended 31 March 2011, Lumax produced 9.47 million units of head lamp assembly and 5.29 million units of tail lamp assembly/rear combination lamp. Lumax customers include Ashok Leyland, Fiat, Force Motors, Ford India, Diamler India, GM India, Hindustan Motor, Honda Siel, Hyundai Motor India, Kinetic Motor, Mahindra & Mahindra, Maruti Suzuki, Swaraj Mazda, Renault, Tata Motors, Toyota Kirloskar and Volvo.
Recent Developments
Employees
Group : 1,538 (March 2011)
Corporate strategy Lumax is investing in capacity expansion to meet expected surge in demand from its customers in India over next few years. In 2011, the company announced that it had earmarked INR2bn (USD44m, 31 March 2011) for setting up three manufacturing facilities and upgrading capacity at its existing plants in the country. The planned investments include construction of a new plant in Bawal, Haryana to serve Maruti Suzuki and another new plant in Bangalore, Karnataka to supply lighting for Toyota. Further, the company has also revived its plan to set up a plant in Sanand, Gujarat to supply lighting components to Tata Nano. The company is also scaling up its activities in the area of research and development (R&D) and has budgeted INR1.5bn (USD33m, 31 March 2011) for developing new lighting systems. During fiscal 2011, the company developed interior and exterior lighting for four-wheelers. Further research was undertaken in areas including complete tail lamp design with proto development, and design of tail lamps from concept to production. Investments In September 2011, Lumax announced plans to invest INR1.5bn (USD30.1m, 30 September 2011) to establish three manufacturing facilities in India to meet expected surge in demand over the next few years. The company will set up new facilities in Bangalore, Karnataka; Bawal, Haryana and Sanand, Gujarat. The company also announced plans to expand its existing units in Pune, Maharashtra (India) by the end of 2011. With this step, the company aims to increase production by 2.5 million units to 6.5 million units a year. In 2010, Lumax established a new manufacturing plant in Haridwar in
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Uttrakhand to supply Hero MotoCorp. In 2007, Lumax announced plans to set up a plant in Pant Nagar, Uttaranchal (India) to supply Tata Motors. The plant became operational in 2008. The company also invested in expansion of capacities at its plant in Dharuhera, near Gurgaon in Haryana and Chaken near Pune in Maharashtra (both India).
Contracts OEM/Brand Honda Hyundia Hyundai Hyundai Mahindra & Mahindra Maruti Suzuki Maruti Suzuki Maruti Suzuki Tata Model City Accent Santro Verna Scorpio Swift Swift Dzire SX4 Sumo Component Headlamp assembly, high mount stop lamp, rear combination lamp, gear knobs and gear shifter High mount stomp lamp and rear combination lamp Front fog lamp, headlamp assembly and rear combination lamp High mount stop lamp Headlamp assembly, rear combination lamp and high mount stop lamp Rear combination lamo, parking brake, headlamp assembly, gear knobs, fog lamps and sundry lamps Gear knobs, sundry lamps, headlamp assembly, parking brake, fog lamp and rear combination lamp Sundry lamp, rear combination lamp, gear shifter and headlamp assembly Headlamp assembly, rear combination lamp, sundry lamp, fog lamp, rear combination lamp and headlamp assembly
Research and development Lumax incurred INR92.7m (USD2m, 31 March
2011) on research and development or 1.08% of its sales in fiscal 2011. During the financial year the company spent on in-house designing of LED interior and exterior small lamps for four-wheelers. The company also concentrated on indigenous design of tail lamps from concept to production. Lumax has technical alliances with leading automotive lighting suppliers such as Stanley Electric, Valeo Automotive Lighting and SL Corporation. The company has recently developed the following: In 2010, Lumax introduced interior and exterior lightings for fourwheelers. In 2010, Lumax developed LED centrally high mount stop lamp adopted for four-wheelers. Financial Overview In the financial year ended 31March 2011, Lumax recorded net sales of INR8.6bn (USD189.6m, 31 March 2011), an increase of 35.8% compared to INR6.3bn (USD142.8m, 31 March 2010) in 2010. Higher sales led the company to record a fourfold increase in profit before tax (PBT) to INR 237.3m (USD142.8m) compared with INR63.8m (USD1.4m) in the previous financial year. The company also posted nearly a threefold increase in net profit to INR179.7m (USD3.9m) over INR59.3m (USD1.3m) in fiscal 2010. Product wise, Lumax generated sales of INR4.7bn (USD104.7m) from headlamp assembly, INR1.3bn (USD29.7m) from tail lamp assembly and rear combination lamps, INR293.6m (USD6.5m) from tools and INR221.2m (USD48.8m) from sales of miscellaneous items. Geographically, Lumax generated INR8.4bn (USD185m) in sales from India, representing a 35.4% increase compared with sales of INR6.2bn (USD137.6m) in fiscal 2010. Sales from the overseas markets were up 65.1% from INR124.7m (USD2.7m) to INR206m (USD4.5m) came from international markets.
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Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007
Net Sales (INRm) 8,609.2 6,341.5 5,230.8 5,219.8 5,353.8 Net Sales (USDm) 189.6 139.7 100.2 130.8 134.2
Profit Before Tax (INRm) 237.3 63.8 (36.4) 201.9 279.9 Profit Before Tax (USDm) 5.2 1.4 (0.7) 5.1 7.0
Net Profit (INRm) 179.7 59.3 (16.2) 141.5 182.8 Net Profit (USDm) 3.9 1.3 (0.3) 3.5 4.6
Outlook Like most of the Indian suppliers Lumax industry benefited from the strong growth in the automotive industry in 2010 and 2011. However, financial year 2012 will be different with sharp decline in vehicle demand due to unfavourable business environment in India. However the medium-term growth outlook of the Indian automotive market remains strong. This creates twin challenges for major local suppliers, like Lumax, to deal with the immediate challenges, but not be discouraged by them, and to keep investing in ramping capacity to meet expected surge in demand in medium to long term. Lumax is looking at tapping export markets which could help the company to deal with the fluctuating demand at home. The company expects to benefit from its long term association with Stanley Electric of Japan. The Japanese supplier is not only a technical partner but also own 37% in the Lumax. The Indian supplier expects to gain not only from the technological expertise of the Stanley Electric but also from its global customer base and could become a low cost sourcing partner for the latter.
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Machino Plastics
Bumpers and dashboards
Address Machino Plastics Limited Plot No. 3, Maruti Joint-Venture Complex Udyog Vihar, Phase-IV Gurgaon 122015 Haryana India Tel: +91 124 2340806/ 2341218 Fax: +91 124 2340692 Website: http://www.machino.com Senior Officers Murali Dhar Jindal, Chairman Dr. Sanjiivv Jindall, Managing Director Aditya Jindal, Vice-President Sarita Jindal, Executive Director SK Aggarwal, Head, Finance Pradip Kumar Saha, Head Operations Products Air intake manifolds, bumpers, fenders, radiator grilles, instrument panels and console assemblies Plants India (2): Haryana (2) Sales INR1.6bn (USD35m, 31 March 2011) (Year to 31.03.2011)
Machino Plastics manufactures injection-moulded plastic components for the automotive industry. The company is the largest suppliers of bumper and dashboards to Maruti Suzuki India. The company also has interest in other businesses such as car dealership through associated companies.
Machino Plastic was established in 1987 as a joint-venture between MD Jindal family and associates and former Maruti Udyog, now Maruti Suzuki, to cater to the automakers plastics requirements. The Jindal family and associates hold a 43.32% stake in Machino while Maruti Suzuki and Suzuki Motor Corporation hold 15.35% each in the company. The company operates two manufacturing plants in Gurgaon, Haryana (India). Of the two, Machino Plastic operates its first facility in Maruti JointVenture Complex in Gurgaon. The company operates its second manufacturing plant in Manesar, near Gurgaon. Machino Plastics mainly counts on Maruti Suzuki as its major customer. The company has succeeded in winning some business from Volvo Eicher Commercial Vehicle. Machino Plastic also supplies its products to Suzuki Motorcycle. In addition, the company supplies its products to several tier one suppliers such as Bharat Seats, Krishna Maruti, Mikuni and SMR Automotive. Corporate strategy Machino Plastics is working to reduce its dependence on Maruti Suzuki as a key customer. The company has expanded its customer base and has included Volvo Eicher Commercial Vehicle and Suzuki Motorcycle as new customers. In addition, the company has received proposals from automakers to set up a facility exclusively for them. Machino Plastics is evaluating such opportunities to ascertain the feasibility of establishing plants. The company believes that the demand for plastic components will continue to increase considering the weight reduction benefit offered by the use of such products. To ramp up the production, Machino Plastics has placed orders for seven new machines in 2010 which is in addition to the 34 machines already in place on 31 March 2011. Investments In January 2008, Machino Plastics opened a manufacturing facility in Manesar, Haryana (India) for moulding components. The plant has 24 injection moulding machines ranging from 120 tonnes to 2500 tonnes.
Recent Developments
Employees
c. 70 (2011)
Contracts Machino Plastics supplies plastic bumpers for most of Maruti-Suzuki models. The company also supplies instrument panels for all Maruti models. Machino Plastics is a supplier to air-conditioning systems manufacturer Sanden Vikas. Machino Plastics supplies exterior and interior plastic components for Volvo Eicher Commercial Vehicles. Machino Plastics supplies air intake manifolds for Japan-based Mikuni Corporation. Machino Plastics supplies mirror housing parts for SMR Automotive, a business unit of Sumvardhana Group Limited.
Quality Certifications Machino Plastics plants are ISO 14001, OHSAS 18001 and TS 16949:2002 certified.
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Financial Overview In the financial year ended 31 March 2011 Machino Plastics reported a 28.8% increase in sales to INR1.6bn (USD35m, 31 March 2011) compared with INR1.2bn (USD27.4m, 31 March 2010) in the previous year. The company benefited from strong growth in vehicle production at its Maruti Suzuki. The company reported profit before tax of INR122.9m (USD2.7m), up 13.2% from INR108.5m (USD.4m) in 2010. Machino Plastics concluded the financial year with a 15.4% growth in net profit to INR82.4 (USD1.8m) over INR 71.3m (USD1.6m) a year ago. Machino expects its sales to exceed INR2bn (USD44m, 31 March 2011) in the financial year ending 31 March 2012. However, the company may find it difficult to meet its financial goal considering continuing vehicle demand since the beginning of the financial year. The frequent strikes at the companys major customer, Maruti Suzuki, are also expected to impact its topline growth during the financial year. Year Net Sales Profit Before Net Profit (INRm) Tax (INRm) (INRm) 2011 1,590.6 122.9 82.4 2010 1,234.4 108.5 71.3 2009 843.2 13.6 0.5 2008 878.0 48.5 31.4 2007 828.1 75.5 55.0 Year 2011 2010 2009 2008 2007 Net Sales (USDm) 35.0 27.4 16.2 22.0 19.1 Profit Before Tax (USDm) 2.7 2.4 0.2 1.2 1.7 Net Profit (USDm) 1.8 1.6 0.01 0.8 1.3
Outlook Machino Plastics has expanded its customer portfolio in a bid to reduce its dependence on Maruti Suzuki. However, despite adding new business from other automakers, the company still derives a major proportion of sales from Maruti Suzuki which means any obstacle to the automakers operations will negatively hamper Machinos sales as well. For instance, the frequent strikes at the automakers Manesar plant in 2011, which resulted in production loss of several thousand vehicles, are expected to hurt Machino Plastics financial performance during the financial year 2012. Automakers globally are increasing use of plastic components in place of metal in an attempt to reduce overall weight of vehicles to meet stringent emissionsrelated regulations. This trend is slowly but surely catching up among automakers operating in India. Machino Plastics, as a major supplier of automotive plastic components, is well position to grow from this trend.
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Madras Engineering
Air brake systems
Address Madras Engineering Industries C-6, Ambattur Industrial Estate Chennai 600 058 Tamil Nadu India Tel: + 91 44 4398 3200 Fax: + 91 44 2625 0178 Internet: http://www.madrasengineering.com Senior Officers EK Parthasarthy, Chairman & Managing Director Sanjay Parthsarthy, Director Radha Parthasarthy, Director Sriram Sivaram, President Priya Sriram, Director Products Automatic slack adjusters, brake chamber, clutch booster assembly, manual slack adjusters, self setting automatic slack adjuster, spring brake actuator, wear sensor Plants India (3): Tamil Nadu (3) Sales INR1.42bn (USD31.5m, 31 March 2010) (Year to 31.03.2010)
Madras Engineering Industries is a leading supplier of automatic and manual slack adjusters. The company also manufactures air brake components for the automotive industry.
Madras Engineering was established in 1966 to manufacture various machined components for the automotive industry. About 16 years later in 1982 the company started production of manual slack adjusters and parts for air brake systems for light-, medium- and heavy-duty commercial vehicles. In 2000, the company developed automatic slack adjusters for light-, medium- and heavyduty commercial vehicles for the global market. The company operates three manufacturing facilities located in the Chennai auto cluster, in Tamil Nadu (India). Madras Engineering has also established a research and development (R&D) centre in Chennai, Tamil Nadu. Madras Engineering supplies its products to AMW, Ashok Leyland, Bharat Benz, Caterpillar, Eicher, Mahindra Navistar, SML Isuzu and Tata Motors. In addition, the company exports its products to KAMAZ, Meritor, KnorrBremse, Scania and Volvo Trucks. In addition to OEM, the company caters to the aftermarket through its strong distribution network. The company also exports its products to major international automotive markets, such as Australia, Africa, Canada, Europe, the Middle East, New Zealand and Southeast Asia and the UK and the US. international marketing is handled by John Bruce, UK which is also an equity partner in the company.
Recent Developments
Corporate strategy Madras Engineering is diversifying its product portfolio with a goal to become a complete air brake system component manufacturer. The company, which has mainly produced various types of slack adjusters in the past, is now manufacturing additional products including spring brake actuator, brake chamber, clutch booster assembly and wear sensor assembly. The new product listing will comprise advanced foundation brake parts, antilock and electronic brake systems for commercial vehicles. While the domestic market remains a major source of sales, the company is working to establish a strong presence in the international market through exports. Madras Engineering plans to establish a strong export business for automatic slack adjusters. Keeping this in mind, the company established its third manufacturing plant in a dedicated special economic zone (SEZ) in Chennai, Tamil Nadu (India). This makes the companys exports of slack adjusters from SEZ competitive in the international markets. Investments In 2009, Madras Engineering set up a research and development (R&D) facility at IITM Park in Chennai, Tamil Nadu (India). In 2007, Madras Engineering opened its third plant at Mahindra World City SEZ in Chennai, Tamil Nadu (India) to produce automatic slack adjusters for the global market. In 2006, Madras Engineering Industries invested INR400m (USD9m, 31 March 2006) for expansion of production facilities for automatic slack adjusters. Contracts MEI supplies slack adjusters to Ashok Leyland. MEI fulfills slack adjuster requirement of Tata Motors. MEI supplies slack adjusters to Swaraj Mazda. MEI provides slack adjusters to Asian Motors.
Employees
c. 500 (2011)
311
Certifications Madras Engineering has been accredited with ISO 9000-2000 for its Maraimalainagar unit and QS 9000 for its Ambattur unit. The company has also been certified with ISO / TS 16949-2002 Quality Certification for systems and procedures by TUV, Germany. New Product Developments Madras Engineering opened a research and development facility at IITM Park in Chennai, Tamil Nadu (India). The centre is recognised by Department of Scientific and Industrial Research (CSIR), Ministery of Science and Technology, Government of India. The company has focused on the indeginious development of self setting automatic slack adjusters. In addition, Madras Engineering has developed clutch boosters, spring brake actuators, brake chambers and wear sensors. Financial Overview In the financial year ended 31 March 2010 Madras Engineering reported 35.2% increase in net sales to INR1.42bn (USD31.5m, 31 March 2010) compared with INR1.05bn (USD20.1m, 31 March 2009) during the same period in 2009. The companys profit before tax (PBT) for the period stood at INR133.2m (USD2.95m), up 194% from INR45.3m (USD868,244) in 2009. Madras Engineering is a privately owned company. Therefore the company does not provide details of its financial results. Outlook Madras Engineering has witnessed a robust growth in sales over the past five years on account of high demand for commercial vehicles and the increasing sales of higher tonnage, multi-axle vehicles in India. The company has emerged as a strong supplier of slack adjusters in India with more than twothirds of the market share. Madras Engineerings recent focus to diversify its presence to other components of air brake system is expected help it mitigate business risk and improve its financial performance. The Indian automotive market is witnessing entrance of several commercial vehicle manufacturers in the past few years. Madras Engineering, with a strong presence in slack adjuster business, is well positioned to grow. In addition, the growing awareness in the area of automotive safety is expected to boost the companys sales in coming years.
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Magna
Auto components, systems, modules and complete vehicle assembly
Address Magna International Inc. 337 Magna Drive Aurora, Ontario L4G 7K1 Canada Tel: +1 905 726 2462 Fax: +1 905 726 7164 Internet: http://www.magnaint.com Regional Address Magna International 101 Kane Plaza, Mind Space, Malad West Mumbai 400 064 Maharashtra India Tel: +91 22 4219 0800 Internet: http://www.magnaint.com Senior Officers Mike Harris, Chairman Belinda Stronach, Executive Vice-Chairman Donald J. Walker, CEO Vincent J. Galifi, Executive Vice-President and CFO Herbert Demel, Executive Vice-President and Chief Strategy Officer Jim Tobin, Chief Marketing Officer and President, Magna Asia Tom Skudutis, COO, Exteriors, Interiors, Seating, Mirrors and Closures, President, Cosma Products Body and chassis systems, closure systems, complete vehicle assembly, exterior and interior systems, powertrain systems, vision and electronic systems Plants India (5) Outside India: Argentina (4), Austria (18), Belgium (2), Brazil (10), China (20), Czech Republic, (9) Hungary (2), France (4), Germany (38), Ireland, Italy (3), Japan (2), Poland (5), Russia (5), Slovakia (3) South Africa (2), South Korea (4), Spain (4), Thailand, UK (9)
Magna is the largest auto parts supplier in Canada and ranks among the worlds top five suppliers. The company supplies automotive components, systems and modules. Magna is also engaged in the engineering and assembly of complete vehicles for OEMs.
Magna has one of the broadest product offerings, which enables it to pitch for nearly all components of a new vehicle model. The company organises its comprehensive business into the following segments: Exterior and interior systems (Decoma International) (accounted for 37% of 2010 sales): front and rear bumper systems, greenhouse systems, lighting systems, sealing systems, vehicle enhancement packages, bodyside panels, polymeric glazing systems, complete interior integration, sidewall and trim systems, cockpit systems, cargo management systems, overhead systems, floor carpet and complete acoustic systems. Body systems and chassis systems (Cosma International) (19.9%): chassis systems, metal-forming technologies, body systems, body-in-white, finishing. Powertrain systems (Magna Powertrain) (15.1%): drivetrain systems and components with special competence in four-wheel drive (4WD) and allwheel drive (AWD), axles and chassis modules, engine systems and modules, transmission systems and modules. Complete vehicle assembly (Magna Steyr) (9%): vehicle engineering, vehicle assembly, components, modules and tank systems (Mexico). Vision and electronic systems (Magna Donnelly & Magna Electronics) (6.6%): complete interior integration, sidewall and trim systems, cockpit systems, cargo management systems, overhead systems, floor carpet and complete acoustic systems, power systems, driver assistance and safety, body electronics, wireless systems. Closure systems (Magna Closures) (4.3%): door modules, window systems, driver controls, power-closure systems, latching systems, handle assemblies. Tooling, engineering and other (8.1%)
As of December 2011, Magna had presence in 26 countries with 286 manufacturing facilities and 88 product development/engineering/sales centres and employed 107,000 people. In India, the company operates five manufacturing facilities and five engineering, product development and sales centres and has 825 employees. Magna supplies to all major automakers worldwide. The company major customers include BMW, Chrysler, Daimler, Fiat, Ford, Fuji Heavy, GM, Honda, Hyundai/Kia, Mitsubishi, PSA Peugeot Citroen, Renault-Nissan, Suzuki, Tata Motors, Toyota, Volkswagen and Volvo Cars. Recent Developments Corporate strategy Magna continues to focus on expanding its global presence, diversifying its customer base and improving under-performing assets. The company is working towards increasing its geographic presence in emerging automotive markets in Asia-Pacific. In December 2011, Cosma International, a business unit of Magna, announced plans to set up a manufacturing plant in Talegaon, near Pune (India) with an investment of INR3bn (USD55.3m, 28 December 2011). Earlier in 2009, the company announced its intention to set up integrated facilities for its five business divisions in India, which do not yet have a presence in the country. However, no update is available about this ambitious plan of the Canadian supplier. The company has been working on increasing investments in low-cost countries since 2008 in an attempt to reduce its overdependence on high cost
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Sales Group: USD28.7bn (Year to 31.12.11) India: N.A Employees Group: 107,000 (December 2011) India: 825 (December 2011)
countries in North America and western Europe. The company has a significant presence in China where it operates 20 manufacturing and assembly plants. Magana is also keen to expand its presence in other emerging markets such as Brazil, India and Russia with an aim to generate more than 5% of its sales each of these markets in near future. Acquisition In March 2011, Magna Donnelly, the automotive mirror business unit of Magna, acquired its joint-venture partner, Lumax Automotive Systems stake in Lumax Magna Donnelly Automotive Mirror Private Limited in India. Following the acquisition, the JV became the wholly-owned subsidiary of Magna Donnelly. The JV was formed in 2005 to manufacture mirrors for passenger vehicles and inner door handles. Joint-ventures In September 2010, Magnas complete vehicle assembly unit, Magna Steyr entered into a business development and technical assistance agreement with Indias Hero Motors to develop new products for both the local and global markets. Under the agreement, Hero Motor and Magna Steyr will jointly develop new products including drivetrain assemblies for the automotive industry. In August 2009, Magna entered into a 50:50 joint-venture agreement with the India-based Krishna Group to manufacture seating systems and seat mechanisms for OEMs based in Chakan, near Pune in Maharashtra (India). The joint-venture is named MSKH Seating Systems. In January 2009, Magna Powertrain, a business unit of Magna, formed a 50:50 joint-venture with Rico Auto Industries, an India-based powertrain components and assemblies supplier. Based in Gurgaon, Haryana (India) the JV, Magna Rico Powertrain Limited, manufactures oil and water pumps with aluminium housings for automotive engine applications for Indian and European markets. In November 2006, Magna Powertrain entered into a joint-venture with Amtek Auto to set up a flexplate assembling facility in Gurgaon, Haryana (India). The 50:50 JV, Magna Powertrain Amtek Automotive India Limited, initially exported flexplate assemblies to the European market, but later started production for the Indian market as well. Investments In December 2011, Cosma International, a business unit of Magna, announced plans to set up a plant in Talegaon, near Pune, Maharashtra (India) with an investment of INR3bn (USD55.3m, 28 December 2011). The plant is expected to begin production in 2012. The company acquired the land from ZF Steering Gear India for INR470m (USD8.7m), to set up the plant for manufacturing mechanical and hydraulic powered steering gears at the same site. In April 2009, Magna announced plans to set up an integrated manufacturing facility. The set-up of an integrated facility was planned considering the vast geographic area and presence of diversified automakers. The integrated facility will function as the mother plant for the operations of all the business divisions and support satellite units, thereby leveraging the companys overhead costs. In January 2008, Magna Steyr, an operating unit of Magna announced plans to establish a new engineering and research & development office in Chakan, Pune (India). The office employs about 190 people. New Product Developments Magna generally spends about 7% of its pre-tax profit on R&D every year, operating from 88 product development/engineering/sales centres globally. Of these, the company operates five engineering/product development/sales centres in India. Financial Overview In the financial year ended 31 December 2011 Magna reported a 22.5% increase in net sales to USD28.7bn compared with USD24.1bn a year earlier. Higher sales were driven by increased demand for its products in major automotive markets including North America, Europe and rest of world. During the financial year, vehicle production increased in North America by 10% to 13.1 million units and 3% in Europe to 13.7 million units. In addition, the companys revenue improved due to a 51% volume growth in Complete Vehicle Assembly business to 130,000 units.
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Despite strong growth in sales Magna reported flat earnings compared with the previous year. The companys operating income as well as net income remained unchanged at previous years level of USD1.2bn and USD1bn respectively. Segment wise, Magnas sales in North America increased by 21% to USD13.9bn, in Europe by 25.3% to USD8.7bn and in Rest of World sales by 61% to USD1.4bn. In addition, the companys sales in Complete Vehicle Assembly segment surged 24.4% to USD2.7bn whereas Tooling, Engineering and Other sales grew marginally to USD2bn. For the financial year ending 31 December 2012 Magna expects its sales to be around USD28bn to USD29.5bn. The company is expecting an operating income margin of 5%. Year 2011 2010 2009 2008 2007 Net Sales (USDm) 28,748 24,102 17,367 23,704 26,067 Operating Income (USDm) 1,217 1,197 (511) 328 1,152 Net Income (USDm) 1,018 1,003 (493) 71 663 Employees 107,000 96,600 72.500 74,350 83,400
Outlook Magna needs to diversify its customer base and geographic presence in the medium to long run to reduce its dependence on only a few customers and traditional markets. The company needs to increase sales to Asian OEMs as they are increasingly gaining the global market share. Diversifying its geographic footprint is equally important to reduce the cost of production and strengthen its presence in the growing markets in Asia, eastern Europe and Latin America, which are low cost destinations. Magna, with its strategic joint-ventures with major local suppliers such as Amtek Auto, Krishna Group and Rico Auto, is well positioned to increase its presence in India. The local manufacturing presence also allows the company to effectively cater to the global automakers such as Ford, GM, PSA Peugeot Citron, Renault- Nissan, Suzuki, Toyota and Volkswagen, who have manufacturing facilities in India.
315
Magneti Marelli
Automotive systems and modules
Address Magneti Marelli SpA Viale Aldo Borletti 61/63 20011 Corbetta, Milan Italy Tel: +39 2 9722 7111 Fax: +39 2 9722 7862 Internet: http://www.magnetimarelli.com Regional Headquarters Magneti Marelli SKH Exhaust Systems Pvt Ltd. Gate No 542/545, Behind Bombay Dyeing, Village Dokhsangvi, Ranjangaon, Shirur, Pune 412216 India Tel: +91-2137-21386750 Senior Officers Eugenio Razelli, President & CEO President, Automotive Lighting Donatella Penati, CFO E. Ferrari, Chief Operating Officer, Automotive Lighting Sergio Garue, Head, Business Development & Sales L. Ippolito, Head, Dynamic Systems Giuseppe Rosso, Chief Technical Officer and CEO, Infotainment and Telematics Piero Toselli, CEO, Powertrain and Electronics Javier Simon, CEO, Exhaust Systems Alfredo Leggero, Head, Manufacturing and CEO, Plastics Components & Modules Edison Lino Duarte, CEO, Shock Absorbers Products Alternators, motors and voltage regulators, climate control systems, cockpit modules, driveline control system, electronic control units (ECU), engine control systems, exhaust systems, instrument panels, fuel system and ignition, on-board information systems, automotive lighting, safety and energy systems, shock absorbers, suspension systems, transmission systems Plants Pune (2), Manesar (3) Sales
Magneti Marelli is a Fiat owned auto parts maker based in Italy. The company produces systems, modules and technologically advanced components for the automotive OEM and aftermarkets.
Magneti Marelli operates in the following businesses: Automotive Lighting: manufactures front and rear lighting systems. Electronic Systems: produces instrument clusters, telematics, and body computers. Powertrain: supplies engine control systems for gasoline, diesel, multifuel engines, and automated Selespeed gearboxes. Suspension Systems: develops suspensions, shock absorbers, and dynamic systems. Exhaust Systems: engaged in the production of exhaust systems, catalytic converters and silencing systems. After Market Parts and Services: supplies spare parts for the independent aftermarket. Motorsport: manufactures electronic and electro-mechanical systems specifically for F1, MotoGP and the WRC. Plastic Components and Modules: produces dashboards, fuel systems, centre consoles, bumpers and fuel systems. The Suspension systems business of Magneti Marelli provides components related to chassis systems. The business had 13 production facilities and two research centres in Brazil, India, Italy, Poland, Spain and US as on 31 December 2009. Magneti Marelli had 77 plants in 18 countries worldwide at the end of December 2009. In India, the company operates five manufacturing facilities, two in Pune and three in Manesar, Gurgaon. The companys major customers include Audi, BMW, Citron, Ferrari, Fiat, Ford, Lancia, Maruti Suzuki, Mercedes-Benz, Skoda, Tata and Volkswagen. Recent Developments Corporate strategy Magneti Marelli is diversifying its customer base and striving towards reducing its dependence on parent company Fiat. Currently the company generates nearly 40% of its total sales from Fiat which it plans to reduce to 36% by 2010. In an attempt to improve its long-term profitability, Magneti Marelli is working towards increasing its presence in the emerging countries. In addition, the supplier has plans to double its sourcing from low-cost countries. Like many other auto components manufacturers, the BRIC countries (Brazil, Russia, India and China) are one of the key focus areas in Magneti Marellis growth strategy. In the Indian market, Magneti Marelli established a joint-venture (JV) in November 2011 with Talbros Automotive Components to manufacture suspension systems. In September 2009, the company formed a JV with Unitech Machines for the production of electronic components such as instrument cluster, body electronics and telematic devices. In January 2008, Magneti Marelli and Sumi Motherson formed a JV in India aimed at the production of automotive components in the area of lighting and engine control systems. The company signed two 50:50 JV agreements with Krishna group companies in February 2008, SKH Metal and SKH Sheet Metal Components, to manufacture automotive exhaust systems in Pune. Magneti Marelli and Endurance Technologies concluded a partnership in June 2008 for the production of shock absorbers for passenger and commercial vehicles in Chakan, Maharashtra (India). Joint-ventures In November 2011, Magneti Marelli formed a 50:50 JV with Talbros Automotive Components in Faridabad, Haryana (India) to manufacture auto components such as control arms, knuckles, front axles and rear axles. It will also manufacture entire suspension systems for the OEMs. The JV is
316
EUR5.9bn (USD7.6bn, 31 December 2010) (Year to 31.12.11) Employees 34,269 (31.12.2010)
expected to be operational by April 2012. In September 2008, Magneti Marelli set up its fifth JV in India to design, produce and assemble vehicles and electronic components such as instrument cluster, body electronics and telematic devices. In a 51:49 alliance, Magneti Marelli bought the major stake while the remaining equity is held by Unitech Machines. The latter invested INR400m (USD8.7m, 16 September 2008) to set up a facility in Manesar (India) for the new venture. In June 2008, the company formed a JV with Endurance Technologies in India, to manufacture shock absorbers for passenger and commercial vehicles. Magneti Marelli owns 50% minus one share, while Endurance Technologies share is 50% plus one share in the coalition. Production of components including gas springs and semi-corner modules started in 2009 at the existing facility of Endurance Technologies in Chakan, Maharashtra (India). Also, Magneti Marelli announced plans to set up a new facility in Bangkok (Thailand). In February 2008, Magneti Marelli set up two 50:50 JVs with Krishnaowned SKH Metals and SKH Sheet Metal Component. The JVs were created through the subsidiary Magneti Marelli Sistemi di Scarico. The coalition with SKH Metal includes setting up a manufacturing unit at the Maruti Suzuki Industrial Suppliers Park in Manesar (India) to produce and assemble exhaust system components for Maruti Suzuki India Limited (MSIL) and Suzuki Motors. The other venture, with SKH Sheet Metal, with a plant in the auto cluster at Pune (India), was set up to produce exhaust systems for OEMs such as Fiat and Tata. In January 2008, Magneti Marelli signed a 50:50 JV agreement with Sumi Motherson for the production of lighting components: headlamps and rear lamps along with intake manifolds. The facilities were set up in Pune and New Delhi (India). In October 2007, Magneti Marelli, Suzuki Motor and Maruti Suzuki India signed an agreement for the creation of a JV in India, aimed at the production of electronic control units for diesel engines. Magneti Marelli has a 51% of the share capital of the new company, Suzuki owns 30%, and Maruti the remaining 19%. The initial investment was estimated at EUR15m (USD21.1m, 11 October 2007). The industrial activities are located in Manesar, in the industrial district of Gurgaon, approximately 40 kilometres southwest of New Delhi (India). Production started end 2008.
New Product Developments In 2011, Magneti Marelli spent EUR309m (USD400.1m, 31 December 2011) on research and development, down 9.4% compared with EUR292m (USD386.9m, 31 December 2010) in the previous financial year. Magneti Marelli operates 11 R&D centres and 26 Application Centres worldwide. Financial Overview For the financial year ended 31 December 2011, Magneti Marelli revenues increased by 8.5% y/y to EUR5.86bn (USD7.58bn, 31 December 2011) compared with EUR5.4bn (USD7.2bn, 31 December 2010) a year ago. Despite strong growth in sales the company reported a sharp decline of 63% in operating profit from EUR73m (USD93.7m) to EUR27m (USD34.9m). The company is owned by the Fiat Group, therefore it does not publish details of financial results. Year 2011 2010 2009 2008 2007 Sales (EURm) 5,860 5,402 4,528 5,447 5,000 Operating Profit (EURm) 27 73 (40) 93 209 R&D Expenditure (EURm) 309 292 245 268 221 No. of Employees 34,804 34,269 31,628 33,216 27,962
Year 2011 2010 2009 2008 2007
Sales (USDm) 7,587.8 7,158.4 6,489.6 7,677.7 7,359.2
Operating Profit (USDm) 96.7 57.3 131.1 307.6
R&D Expenditure (USDm) 386.9 351.1 377.7 325.3
No. of Employees 34,269 31,628 33,216 27,962
317
Outlook Magneti Marelli has evolved as a leading automotive systems supplier with a widespread production base. The company still faces the problem of its heavy dependence on Fiat. In order to reduce its dependence, the company is signing contracts with other OEMs, and in the near future, its customer portfolio is expected to increase as the company continues to explore newer markets. Magneti Marelli intends to grow its market share in emerging markets such as India. Fiat group and Magneti Marelli are targeting to increase its revenue from Indian operations ninefold to EUR350m (USD432.8, 27 June 2010) by 2015. Furthermore, Fiats strategy of making India its sourcing hub would open more growth avenues for Magneti Marelli, as the supplier has wide presence in the country. The increase would be 70% from what the group is currently sourcing from India. The country is planned to contribute about 5% to Fiats global purchasing.
318
Mahindra Hinoday
Automotive castings, ceramic magnets and ferrite cores
Mahindra Hinoday is a joint-venture between Mahindra and Hitachi Metals, Japan. Mahindra Hinoday is a leading manufacturer of automotive castings, ceramic magnets and ferrite cores that are used in automobiles and consumer electronic industries. The company generates 80% of total sales from the automotive industry.
The company was established in 1963 as Morris Electronics Ltd. In 1980, DGP Industries acquired the company and in 1985 formed a joint-venture with Japan-based Hitachi Metals. In 1996, the company was renamed DGP Hinoday and finally to Mahindra Hinoday after the promoter group sold their holdings to Mahindra in November 2006. The company focuses on providing ceramic magnets for auto electricals and ductile iron castings for the automotive industry. The company's customers include Automotive Axles, Bosch Chassis Systems India, Dana, Denso India, Hyundai Motors India, India Nippon Electrical, Jaya Hind Industries, Lucas TVS, LML, Mahindra & Mahindra, Matsushita, Meritor, Rane Group, TAFE, Varroc Engineering, Visteon India and ZF Steering Gears.
Address Mahindra Hinoday Industries Ltd, Bhosari Industrial Area, Pune 411 026 Maharashtra India Tel: + 91 20 2712 0811 Fax: + 91 20 2712 8592 Website: http://www.hinoday.com Senior Officers Sudheer Tilloo, President & Managing Director Products Crankshafts, differential carriers, differential cases, turbine housings, wheel hubs Plants India (2) Sales INR2.5bn (EUR39.50m, 31 March 2008) (Year to 31.12.08)
Employees
c. 800 (31 March 2008)
Corporate strategy After the acquisition of the majority stake by Mahindra, the company is now a part of a much larger supplier group. The company began with importing substitution of ferrites in the early 1990s and diversified its business into automotive castings in 2000. Currently, the company is focusing on the commercial vehicle segment to extend its castings business. The company announced in January 2010 its plans to expand capacity of castings in different phases. Under the first phase, the intention was to raise capacity from 40,000 tonnes to 55,000 tonnes. Mahindra Hinoday intends to increase its exports and increase its sales. The company also plans to establish its presence in the off-road and farm equipment segment by expanding its customer base. Contracts The company supplies 100,000 magnets monthly to Visteon's exportoriented unit in Chennai (Tamil Nadu) for use in starter motors for passenger cars. Mahindra Hinoday supplies castings to Mahindra & Mahindra. Financial Overview In the financial year ended 31 March 2008, Mahindra Hinoday generated sales of INR2.5bn (USD62.6m, 31 March 2011) Outlook Mahindra Hinoday is exploring several export opportunities to bring its export targets in line with those of Mahindra Systech, Mahindras component division. The company plans to offer its low cost manufacturing capacity for supplying castings in international markets. With the Mahindra groups marketing support, the company is likely to get a major boost in sales going forward. Mahindra Hinodays plans to expand its product offerings to off-road and farm equipment segment will also help boost its sales.
Recent Developments
319
Mahindra Systech
Aluminium castings, forgings, gears
Address Mahindra Systech 1st Floor, Mahindra Towers, Worli, Mumbai-400 018 India Tel: +91 22 2490 1441 Fax: +91 22 2491 5890 Website: http://www.mahindrasystech.com/ Senior Officers Hemant Luthra, President Sanjay Joglekar, Senior Vice-President, Finance & Accounts Romesh Kaul, Senior Vice-President, Projects Arvind Mehra, Senior Vice-President, Strategy Rajiv Sarin, Senior General Manager, Telematics Products Castings, composites, forgings, gears, magnetics, ring rollings, stampings Plants India (4) Sales INR42.3bn (USD931.7m, 31 March 2011) (Year to 31.03.2011)
Mahindra Systech is a supplier of castings, forgings, steel and other components for the domestic and export markets. The company operates as a subsidiary of Mahindra & Mahindra.
Mahindra Systech offers castings, ferrites, forgings, stampings, gears, rings, magnets, steel, composites, telematics, engineering and contract sourcing services. The company also provides sourcing solutions for automotive and tractor components. It serves electrical, automobile, medical, defense, construction, railway, consumer durables, general engineering, commercial vehicle, industrial, bearing and other capital goods, and power generation industries. Mahindra Systech supplies to customers including Audi, Automotive Axles Limited, Bentler, Benteley, Continental, Daimler, Dana, Denso, Eicher, Force, GM, Honda, Honeywell, Hyundai, Land Rover, Lear, MAN, Mahindra, Mitsuba, Nissan, Renault, Schneider Electric, Siemens, SKF, Toyota, Turbo Technologies, VM Motori and Volvo. Recent developments Corporate strategy Mahindra Systech is undertaking expansion and decided to ramp up production capacity by announcing plans to invest INR3.5bn (USD74.6m, December 2011) in 2010. Some of this will also be used by the company to add new machines. Mahindra Systech announced in March 2011 that it is consolidating all its 16 companies and have it listed. These companies are involved in production of gears, composites, castings, forgings, stampings, steel, ferrites and engineering services. The move will allow the company to have faster access to different companies if they fall under one umbrella. Further, with this step, the company will achieve cost benefits due to larger purchasing volumes, common sales and marketing. Mahindra Systech plans to expand its presence in international markets by making acquisitions. For instance, it was also reported that Mahindra Systech along with four other potential bidders was shortlisted to acquire Canada-based Wescast Industries, a supplier of exhaust systems for passenger and commercial vehicles. The company had earlier bought two German companies Jeco Holdings in 2006 and Schoneweiss in 2007. These acquisitions have helped the company expand its plants outside India. Acquisitions In September 2006, Mahindra System acquired a 67.9% stake in Jeco Holdings, a German forging company. Terms of the deal were not disclosed. In January 2006, Mahindra & Mahindra acquired 98.6% stake in Stokes Group Limited, UK, engaged in forging business. The acquisition includes three companies with two plants located in UK. Stokes supplies to both tier one suppliers and automakers. The move allowed Mahindra Systems and Automotive Technologies (MSAT) to offer a full range of services from design to engineering services, sourcing and supplying components to OEMs. Mahindra Forgings Limited acquired a 90.47% stake in Schoneweiss & Co GmbH, a forging company based in Germany. The company served customers including, MAN, Scania and Volkswagen. Investments In August 2010, Mahindra Systech announced that it plans to invest INR3.5bn (USD74.6m, 5 December 2011) to expand capacity of steel, stamping, forging and castings products. Some of the funds will be used to add new machines. In March 2007, Mahindra Systech invested INR8bn (USD184.1m, 31 March 2007) to expand castings and forgings plants. Of the total amount, the company invested INR2bn (USD46m) each in casting plants and
Employees
NA
320
forging plants. It also added a new plant for Mahindra Renault. Some of the investment was directed towards expansion of MUSCO steel and INR500m (USD11.5m) to INR1bn (USD23m) was spent on a stampings plant. Divestments In November 2011, Mahindra Systech announced that it has hived off the steel business of its subsidiary company, Mahindra Eugine Steel Company (MUSCO), into a new unit. The company divested 49% stake in the company, of which 29% was sold to Sanyo Special Steel company for INR1.1bn (USD21m, 30 November 2011) and 20% to Mitsui & Co for INR76m (USD1.4m). Mahindra Systech retains a 51% holding in the company. Financial Overview Mahindra Systech reported sales of INR42.3bn (USD931.7m, 31 March 2011) in the financial year ended 31 March 2011. Being privately held, the company is not obliged to publish its detailed financial results. Outlook Mahindra Systechs plans to consolidate 16 companies and have them listed will help the company to fund its long-term investments as the Indian automotive industry is expected to grow significantly in near future. Considering an increase in the demand for automobiles, the company has also decided to ramp up the production capacity which will positively contribute to its sales. Further, Mahindra Systechs international activities are going to get a push if the company succeeds in acquiring the Canada-based Wescast. Mahindra Systech is also eyeing acquisitions in gears and castings business in international market with a view to accessing the latest technology. The move will allow the company to secure new contracts and at the same time get access to plants in foreign markets.
321
Mahindra Composites
Composites
Address Mahindra Composites Limited 145, Nehru Nagar Road Pimpri, Pune- 411018 Maharashtra India Tel: + 91 20 2742 5265 / 6 Fax: + 91 20 2742 5272 Website: http://www.siroplast.com Senior Officers Rajiv Satoor, CEO Vijayendra Kolambkar, Deputy General Manager, Finance, Accounts & Costing Nandkishore D Agwan, Sr GM - Works Ravi L Panke, GM, Marketing Nachiket Thakur, General Manager, Product Design & Development Products Bonnet cover, dough moulding compound, engine bonnet cum driver support, engine hood, headlight for embellisher, engine stone hit trey, NVH covers with in situ foam moulding, radiator grill, sheet moulding compound, transmission cover Plants Pune (1), Raigad (1) Sales INR529.5m (USD11.6m, 31 March 2011) (Year to 31.03.2011)
Mahindra Composites is a part of the Systech Group, Mahindras component division. With two plants in the western automotive cluster, Mahindra Composites is a dominant major in the electrical composites market and an emerging major in the small yet rapidly developing automotive composites market in India.
Mahindra Composites was promoted as Siroplast by the Mahindra group and State Industrial Corporation of Maharashtra (SICOM) in 1982 to cater to demand for composites in the automotive and consumer durable sectors. The company drew technical expertise from Menzolit GmbH (Germany). Subsequently SICOM offloaded its interest in the company with Mahindra as the sole promoter of the company. With the inception of Systech as an independent division at Mahindra, Siroplast was renamed as Mahindra Composites and brought under the Systech administration. MCL caters mainly to the electrical and automobile segments. Mahindra Composites has two manufacturing facilities, one each at Pune and Raigad (Maharashtra). Mahindra Composites classifies its business into three segments which are polymer composite compounds, polymer composite components and others, and the manufacture of moulds. Mahindra Composites automotive customers include Mahindra & Mahindra PAL-Peugeot, Swaraj Mazda and Tata Engineering & Locomotive.
Recent Developments
Corporate strategy Unlike Europe where composites form a substantial part of a car body, the subcontinent continues to rely on sheet metal for automotive body parts. Mahindra Composites expects the use of composites in the Indian automotive industry to increase rapidly. Increase in steel prices has led to an increased interest in composites which were earlier considered expensive despite their overall lower life cycle costs. The company is associating itself with forward model programmes of various manufacturers at the design stage to capitalise the full potential of composites as an enhanced design proposition. In the automotive space Mahindra Composites is leveraging its relations with sister concern Mahindra & Mahindra to grow rapidly in the automotive arena. The company is also keen on the commercial vehicle segment which has an inherent requirement of composites in noise, vibration and harness (NVH) applications. Electric vehicles which have been gaining ground in the Indian markets are also a prime target for composites, since weight reduction is an essential metric. Mahindra Composites is moving a step forward in its research and development activities and developed injection molding DMC which is used for moulding headlamps. The company further intends to develop low density compounds for the automotive industry. The company is also looking to form technology tie-up with foreign manufacturers in the field of light weight products. Based on the exterior body panels which were designed for Mahindra Defense, the company has attracted some new customers including Mahindra Construction Equipment, Volvo and Mahindra Navistar Automotive Ltd. The new business with customers is expected to start in financial year (FY) 2012. Contracts The company supplies the radiator grille for the Mahindra Bolero. Infrastructure Hydraulic hot compression moulding presses (100 to 500 tonnes)
Employees
c. 130 (31 March 2008)
322
New Product Developments Mahindra Composites has developed in-house competence for developing materials, tools and designs. In 2007, Mahindra Composites developed a front wheel cover for a threewheeler with class A type surface finished in a two-month period. In 2007, Mahindra Composites developed tooling and components for Avia, (Austria). In 2007, , Mahindra Composites developed products for ITEC, (USA). In 2006, Mahindra Composites developed engine hood for Ashok Leyland.
Financial Overview For the financial year ended 31 March 2011, Mahindra Composite posted sales of INR529.5m (USD11.6m, 31 March 2011), marking a 14.4% increase compared with sales of INR462.6m (USD10.2m, 31 March 2010) in FY2010. Net income before taxes totaled INR37.5m (USD826,030), down 3% from INR38.7m (USD859,430), while net income after taxes was down 5.8% to INR24.3m (USD535,270) against INR25.8m (USD572,950) for the same period in the corresponding year.
Year
Net sales (INR m)

529.5 462.5 431.4 325.2 262.9
Operating profit (INR m)

59.7. 29.4 14.9
Profit before tax (INR m)

37.4 38.6 45.4 15.7 3.8
Net Profit (INR m)

24.3 25.8 28.8 11.2 2.2
2011 2010 2009 2008 2007
Year
Net sales (USD m)

11.6 10.2 8.2 6.2 6.5
Operating profit (USDm)

1.1 563,496 373,434
Profit before tax (USD)

823,828 857,204 870,160 300,914 95,238
Net Profit (USD )

535,268 572,950 551,996 214,665 55,137
2011 2010 2009 2008 2007
Outlook Mahindra Composites automotive growth strategy is beginning to take shape with increased acceptability of composite materials in the Indian automotive industry. While the company still draws a substantial amount of revenue from non- automotive business, the scenario is likely to change with an increased focus on the auto sector. The company has already been able to enter key projects at design stage for exterior body panels which offer immense growth opportunity. At the same time, increased focus on noise, vibration and harness (NVH) by automakers in India will help the company grow rapidly. To this end, Mahindra Composites has already won the mandate of some commercial vehicle manufacturers. The increasing use of light weight components in vehicles which helps to reduce carbon emissions is expected to drive the companys sales. Further, the company will start business with the new customers in FY2012 which will also contribute positively to its sales figure. Considering these moves, Mahindra Composites aims to achieve a 25% growth in FY2012 compared to 2011.
323
MAHLE
Vibration control components
Address Mahle GmbH Pragstrae 26-46 D-70376 Stuttgart Germany Tel: +49 711 501 0 Fax: +49 711 501 2007 Website: http://www.mahle.com Regional Address MAHLE Holding (India) Private Limited Sohna Road, Sector 48 Iris Tech Park, Tower 2, Suite No. 207 Gurgaon-122001 Haryana India Tel: +91 124 4666 199 Fax: +91 124 4666 197 Website: http://www. In.mahle.com Senior Officers Dr.-Ing. Heinz K. Junker, Chairman and CEO Wolfgang Breuer, Filtration and Engine Peripherals Dr. Rudolf Paulik, Engine Systems and Components Dr. rer. pol. Bernhard Volkmann Corporate Finances and Controlling Products Air management systems, cylinder components, liquid management systems, piston systems, small engine components, valve train systems Plants India (5): Haryana, Himachal Pradesh, Madhya Pradesh, Maharashtra, Tamil Nadu Outside India: Argentina (2), Australia, Austria (5), Brazil (6), Canada (2), China (7), France (8), Germany (21), Italy (4), Japan (6), Mexico (5), Netherlands (2), Philippines, Poland, Portugal, Romania, Slovakia, South Korea (2), Spain (2), Switzerland, Thailand (2), Turkey (3), UK (7), USA (14)
MAHLE is one of the leading suppliers of pistons, cylinders, filters and other engine components for the global automotive industry. The core business of the company consists of products in the area of combustion engines and engine peripherals. The company is among the top three suppliers of piston systems, cylinder components, valve train systems, air management systems and liquid management systems.
MAHLE has organised its business into four operating units: Engine Systems and Components (accounted for 45.2% of 2010 sales), Filtration and Engine Peripherals (28.9%), Industry (6.3%) and Aftermarket (13.9%). In addition, the company operates four profit centres: Small Engine Components, Motorsports, Sintered Components and Engineering Services. The four profit centres together generated 5.7% of the companys sales. At the end of 2010, MAHLE had around 47,500 people employed at over 100 manufacturing facilities and eight R&D centres worldwide. The company derived 48% of its 2010 sales from Europe, 17% from North America, 15% from South America and 20% from Asia Pacific. In India, MAHLE operates primarily through three joint-ventures: MAHLE Filter Systems India (MFSI): a joint-venture (JV) formed in 2005 with Indias major component supplier Anand Group. The JV is one of the leading suppliers of air-, oil-, fuel- and hydraulic filter systems for applications in automotive, railways and aviation industries. The JV operates manufacturing plants in Gurgaon, Haryana; Parawnoo, Himachal Pradesh; Pune, Maharashtra and Chennai, Tamil Nadu. MAHLE India Piston Limited: a JV formed in 2007 with India Pistons Limited, a company of the Amalgamation Group, to manufacture pistons for the new Euro IV-compliant gasoline and diesel engines. The company manufactures pistons near Chennai, Tamil Nadu (India). MAHLE Engine Components India: a subsidiary of MAHLE which produces engine components such as cylinder liners, bearings, pistons, piston rings, valves, valve seat guides and valve seat inserts for passenger cars, commercial vehicles, small engines and stationary engines. The company operates manufacturing plants in Pithampur, Madhya Pradesh and Chennai, Tamil Nadu. In addition, the business unit has presence in India through Perfect Circle India, originally a JV between Anand Group and Dana Holding, to produce piston rings. Later, in 2006 MAHLE became a partner in the JV through acquiring Danas engine component business. The company operates a casting plant, piston machining plant and a plate machining plant in Nashik, Maharashtra (India).
In addition, MAHLEs planned acquisition of Behr will further strengthen the formers presence in India. Behr operates a JV with Anand Group, Behr India Limited, which manufactures condensers, radiators and visco fans for automakers operating in India. Globally, MAHLEs major customers include BMW, Fiat, Ford, General Motors, Honda, Porsche, PSA Peugeot-Citron, Renault-Nissan, Toyota and Volkswagen. In India MAHLEs subsidiaries supplies to Ashok Leyland, Bajaj Auto, Escorts, Ford, Force, GM, Honda, Mahindra & Mahindra, Maruti Suzuki, Mitsubishi, New Holland, SML Isuzu, TAFE, Tata Motors, Toyota and Yamaha.
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Sales Group: EUR5.3bn (USD7bn, 31 December 2011) (Year to 31.03.11) India: NA Employees Group: 47,457
Recent Developments Corporate strategy MAHLE has been strengthening its global business through selective acquisitions. Most recently, in July 2010, the company entered into an agreement with Behr to buy its majority stake in several phases. Under the agreement, MAHLE acquired a 19.9% equity stake in 2010 which increased to 36.85% at the end of the financial year. The company also has the option of taking a majority stake in Behr by making an offer to its existing shareholders in 2013. Earlier, in February 2010, MAHLE acquired a controlling stake of 60% in Behr Industry, the industrial unit of Behr which supplies cooling and air-conditioning products for commercial vehicles and various off-road vehicles. This acquisition helped MAHLE to increase its international presence including in emerging automotive markets such as India. In addition to selective acquisitions, MAHLE continued to expand its global presence through entering into strategic alliances with local suppliers in emerging markets. In April 2009, the company formed a joint-venture in India with Indian Pistons Limited, a local piston supplier of the Amalgamation Group. The company already operates two JVs in India, both with the Anand Group, to produce filter systems and engine components. The company has significantly expanded its filter business in India. The JV company, MAHLE Filter Systems India, opened a new manufacturing plant in Chennai, Tamil Nadu in 2011 and in Parwanoo, Himachal Pradesh to meet growing demand for filter system components. Acquisitions In July 2010, MAHLE entered into an agreement with Behr to buy its majority stake in several phases. Under the agreement, MAHLE will buy 19.9% equity stake in 2010 which will be increased to 36.85% at the beginning of 2011. MAHLE plans to fund the investment through its free cash flow without raising debt. MAHLE has the option of taking a majority stake in Behr by making an offer for existing shareholders in 2013. Also, the shareholders of Behr can sell their shares to MAHLE within ten years. Behr operates two manufacturing plant in India in partnership with Anand Group and one development centre in Pune, Maharashtra (India). Joint-Venture In November 2007, MAHLE formed a 50: 50 JV agreement with India Pistons Limited to manufacture pistons for the new Euro IV compliant gasoline and diesel engines. The new company is named MAHLE India Pistons Ltd and manufactures pistons at India Pistons' facilities near Chennai, Tamil Nadu (India). India Pistons is a subsidiary of Amalgamations Group and supplies pistons to all leading local vehicle and engine manufacturers. Investments In May 2011, MAHLE Filter Systems India (MFSI), a joint-venture between MAHLE and the Anand Group in India, opened a new filter manufacturing plant in Chennai, Tamil Nadu (India). The plant will initially supply air filter modules for which it has already secured a contract from an OEM. In the medium-term, the company intends to produce air filter systems, intake modules and cylinder head covers with integrated oil mist separation in the new plant. In March 2010, MFSI inaugurated its new manufacturing plant in Parwanoo, Himachal Pradesh (India). The new plant started operations in April 2010. MFSI invested INR60m (USD1.2m) in the new plant, which has annual production capacity of 22m units. Initially 150 people were employed at the plant and this is expected to increase as the production increases. MFSI plans to manufacture the PU Moulded filter elements, Ecological Plastic Embedded filter elements and Lube Oil spin-on filters with new crimping design at the new plant. The new plant caters to new customers namely Tata Motors, Mahindra & Mahindra, GM and Bosch. New Product Developments In 2010, MAHLE spent EUR310m (USD407.4m) on its R&D activities, compared with EUR246.5m
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(USD323.9m) in the previous financial year. The company has R&D centres in So Paulo (Brazil), Shanghai (China), Stuttgart (Germany), Northampton (UK), Farmington Hills and Novi, both in Michigan (US) and Kawagoe and Okinawa (both in Japan). The company also has an established engine test department in Stuttgart (Germany) to conduct comprehensive tests on live engines. MAHLE employs about 3,000 development engineers and technicians worldwide, who are involved in R&D of the combustion engine. The company is focusing its R&D activities on advanced development projects which include variable valve lift and timing, de-throttling and reduction of emissions and frictional loss to increase the power output of diesel engines. Financial Overview In the financial year ended 31 December 2010 MAHLE reported a 36.2% increase in net sales to EUR5.3bn (USD7bn, 31 December 2011) compared with EUR3.9bn (USD5.5bn, 31 December 2010) in the previous year. The improvement was attributed to a fast recovery in the automotive market, especially in the second half of the financial year. Higher sales led the company to turn around its earnings during financial year 2010. The company reported an operating income of EUR287m (USD380.3m) against an operating loss of EUR100m (USD143.3m) in 2009. MAHLE concluded the financial year with net income of EUR177m (USD234.6m) compared to a net loss of EUR379m (USD543.2m) in the previous fiscal. Segment wise, Engine Systems and Components Business sales increased by 39.4% to EUR2.7bn (USD3.5bn), Filtration and Engine Peripherals by 28% to EUR1.7bn (USD2.2bn), Industry Business by 48.5% to EUR340m (USD446.8m) and Aftermarket Business by 16.8% to EUR735m (USD965.8m). All profit centres together reported a 25.6% increase in sales to EUR544m (USD714.8m). MAHLE reported sales of EUR1.08bn (USD1.4bn) in Asia, Africa and Australia. The company does not disclose sales in India. Years 2010 2009 2008 2007 2006 Years 2010 2009 2008 2007 2006 Net Sales (EURm) 5,261 3,864 5,014 5,060 4,314 Net Sales (USDm) 6,971.6 5,538.0 7,067.4 7,447.6 5,691.5 Operating Income(EU Rm) 287 (100) 160 349 319 Operating Income(US Dm) 380.3 (143.3) 225.5 513.7 420.9 Net Income (EURm) 177 (379) 22 223 192 Net Income (USDm) 234.6 (543.2) 31 328.2 253.3 No. of Employees 47,457 43,489 59,262 47,877 38,603 No. of Employees 47,457 43,489 59,262 47,877 38,603
Outlook Over the past five years, MAHLE has significantly expanded its business through inorganic routes of acquisitions and joint-ventures. The recent takeover of the majority stake in Behr, which will happen in various phases, will result in further expansion of its business. This will strengthen MAHLEs technological capability, expand its product portfolio and broaden its customer base. The company is expected to build and grow on these acquisitions and strategic alliances in coming years. MAHLE is present in India with both Filtration & Engine Peripherals and Engine Systems & Components business units that cater to automotive industry. The companys aftermarket business unit is also present in India. MAHLEs strategic partnerships with local suppliers Anand Group and
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Amalgamation Group have helped the company to increase its business in the country. The global automotive industry is witnessing an increasing number of countries adopting stringent norms in areas of improving fuel efficiency and reducing emissions. This trend is also catching on in India which upgraded to Bharat Stage IV, an equivalent to Euro 4, across 13 major cities and National Capital Region (NCR) in 2010. As one of the leading engine components suppliers, MAHLE is well positioned to gain from these trends.
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Mark Exhaust
Exhaust systems
Address Mark Exhaust Systems Limited 39/7, Begampur Khatola NH - 8 Delhi Jaipur Highway Gurgaon 122001 Haryana India Tel: +91 124 4660 400 Fax: +91 124 4031 012 Website: http://www.markexhaust.com/ Senior Officers RP Goyal, Chairman Rattan Kapur, Managing Director Rohan Kapur, Executive Director Sandeep Chandok, Director Products Brake pads, catalytic converters, door sashes, exhaust manifolds, exhaust systems, fitting kits & flanges, machined components, mufflers, sliding door assemblies, stampings, stationary engine exhausts, tubular assemblies, welded assemblies Plants India (2): Haryana (2) Sales INR3.3bn (USD63.2m, 31 March 2009). (Year to 31.03.09) Employees Group: 1,650 (March 2009)
Mark Exhaust is a major supplier of exhaust systems for twoand four-wheelers in India. The company also makes door sashes and other sheet moulding components for the automotive industry. In addition to the automotive industry, the company caters to the infrastructure sector.
Mark Exhaust was incorporated in 1993 as a joint-venture between Rattan Kapur & Associates and Maruti Suzuki. The company was established to supply exhaust systems, door sash and other sheet metal assemblies to Maruti Suzuki. The leading passenger car manufacturer has a 44.37% stake in Mark Exhaust. Mark Exhaust operates two plants in India both of which are located in Gurgaon, Haryana. As of March 2009, the company had 1,650 employees. The company has a technical alliance with Japan-based Sankei Giken Kogyo since 1994 and South Korea-based Dongwon since 2004. Mark Exhaust entered into a licence agreement with Futaba Industrial to produce Euro 3 catalytic converter in 2005. In addition, the company has technical alliance with UK-based Klarius and Germany-based IAV. Maruti Suzuki continues to remain Mark Exhausts largest customer, accounting for nearly two-thirds of its sales. In addition to Maruti Suzuki, the company supplies to Ford India, Hindustan Motors, Honda Siel Cars, Honda Motorcycle & Scooter India, International Cars and Motors and Piaggio. Recent Developments Corporate strategy Mark Exhaust is focusing on broadening its customer base. The company still generates nearly two-thirds of its sales from Maruti Suzuki, which is also a JV partner, and has successfully added several automakers to its customer base. In 2009, the company started supplying to Ford India. Before that, the company secured a contract to supply Piaggio. The company is planning to invest in additional capacity. Mark Exhaust is working to set up a new facility for manufacturing sheet metal with press capacity ranging from 63 tonnes to 250 tonnes. With this move, the company plans to expand its product offerings and at the same time attract new customers. Contracts In 2009, Mark Exhaust started supplying to Ford India. Mark Exhaust supplies mufflers to Honda Civic. The company supplies door sashes to Maruti Alto, mufflers for Maruti SX4, the EGR pipe for Versa and catalytic converters for both Wagon R and Zen Estilo. Mark Exhaust supplies exhaust systems for the Swift. Certifications Mark Exhaust facilities are accredited with TS16949 and ISO14001 certifications. Financial Overview In the financial year ended 31 March 2009, Mark Exhaust Systems posted sales of INR3.3bn (USD63.2m, 31 March 2009). Being a privately-held company, Mark Exhaust Systems does not publish detailed financials. Outlook Despite certain initiatives taken in order to broaden its customer base, Mark Exhaust continues to rely on Maruti Suzuki for its growth. Meanwhile the company is experiencing growing competition among global exhaust suppliers to supply Indias leading automaker. For, example, the Krishna Group, another of Maruti Suzukis strategic suppliers, has entered into a joint-
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venture agreement with Magneti Marelli to produce exhaust systems in India. The JV is targeting Maruti Suzuki. This is likely to intensify competition and could result in a loss of potential business for Mark Exhaust. However, the company operates in the exhaust systems segment which is expected to see growth with growing focus on improving focus on fuel consumption and emission reduction. As a major supplier of exhaust systems, the company is also well positioned to grow with growth of the automotive industry in India.
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MRF
Tyres
Address MRF Limited 114, Greams Road Chennai- 600 006 Tamil Nadu India Tel: + 91 44 2829 2777 Fax: + 91 44 2829 5087 Internet: http://www.mrftyres.com Senior Officers KM Mammen, Chairman & Managing Director Arun Mammen, Managing Director KM Philip, Whole-time Director Rahul Mammen Mappillai, Whole-time Director Products Tyres Plants India (7): Andhra Pradesh, Goa, Puducherry, Tamil Nadu (3) Outside India: Sri Lanka Sales INR97.4bn (USD1.9bn, 30 September 2011) Employees Group: 13,812 (September 2010)
MRF is one of the leading tire manufacturers in India with about 45% of the market share. In addition to tires, the company has interests in conveyor belts and specialty coatings. The company generates about 95% of its sales from tyres.
MRF was established in 1946 as Madras Rubber Factory. The company entered the tyre market in 1963 in collaboration with Mansfield Tire & Rubber Factory, which subscribed to 25% equity in the company in exchange for technical assistance. Later, the company commenced operations of conveyor belt assembly in collaboration with Pirelli. MRF set up a tread rubber factory in Goa (India) in 1989 and diversified into automotive paints. The company organises its business into four operating divisions: Tyres, Conveyer Belts, Pre-treads and Paint and Coats. The company supplies its tyres to passenger cars and commercial vehicles. In addition, MRF caters to twowheelers such as scooters and motorcycles, and three-wheelers markets. MRF operates six manufacturing plants in India and is constructing its seventh plant which is expected to become operational by the first quarter of 2012. In addition, the company has one manufacturing plant in Sri Lanka. As at 30 September 2010, the company had 13,812 employees. MRF supplies tyres for both original equipment (OE) and replacement markets in India. The companys major customers in the OE segment include Ford, Hyundai and Maruti Suzuki. In addition to the domestic market, the company caters to international markets through exports. The company exports tyres and conveyer belts to 65 countries worldwide including the US, Europe, Middle East and Asia- Pacific. Recent Developments Corporate Strategy MRF is focusing on expanding its production capacity in order to meet expected surge in demand for tyres, driven by strong growth in vehicle sales in India. In March 2010, the company announced it would invest INR30bn (USD666.2m, 31 March 2010) over the next three years to expand capacity at existing plants as well as set up new greenfield plants. As part of its capacity expansion plans, MRF is investing INR7bn to INR8bn (USD155.4m to USD177.8m) in a new manufacturing plant near Tiruchi in Tamil Nadu (India) to produce radial tyres for passenger cars. The plant is expected to become operational in 2012. In May 2011, the company announced plans to raise USD110m through ten-year bonds. The proceeds from the bond sales will be used to fund capacity expansion at the companys facilities. The company is looking for selective acquisitions to complement its organic growth. MRF is exploring acquisition opportunities outside the country since high prices of natural rubber in India are forcing tyre majors to scout for plantations abroad. The company is looking to buy plants overseas and rubber plantations in countries such as Thailand, Cambodia and Vietnam to tackle rising raw material costs. MRF is working to expand its presence in international markets. In February 2011, the company launched tractor tyres in Indonesia. In addition to Indonesia, the company is planning to expand its presence in other countries of the Association of Southeast Asian Nations (ASEAN) region and also into Africa, Australia and New Zealand. Currently, the company exports its products to some 65 countries worldwide. MRF also has a manufacturing plant in Sri Lanka which exports a major part of its production to China and other neighbouring markets. While tyres remain MRFs core business, the company is expanding its portfolio through diversifying into the aviation tires business. In fiscal year 2010 the company launched Aero Muscle, a tire for the aviation industry, after nearly three years research and development. The company was given
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permission for the commercial production of aviation tires. MRF announced plans to set up a manufacturing facility with an investment of INR1.2bn (USD27.5m, 31 March 2011) in its Medak plant in Andhra Pradesh (India). This is expected to help MRF to diversify its customer base and increase sales. Investments In March 2010 MRF announced plans to invest INR30bn (USD666.2m, 31 March 2010) to expand capacity at existing plants as well as setting up new plants in order to meet expected surge in tyre demand. The company will invest around two-thirds of the investment in greenfield factories located in Tiruchi, Tamil Nadu and Medak, Andhra Pradesh, both in India. The company is investing INR9bn (USD197.6m) in the Tiruchi facility which will manufacture radial tyres for passenger cars. The facility is expected to be the companys largest manufacturing facility. The civil work at the Tiruchi facility has been initiated and the company expects to begin production in first quarter of 2012. In financial year 2009, MRF completed the construction work of a new facility near its existing plant in Medak, Andhra Pradesh (India). The new facility has increased MRFs capacity to produce tires for two-wheelers and passenger cars by 20% each. In February 2007, MRF decided to invest between INR5bn and INR6bn (USD113.1m to USD135.7m, 28 February 2007)) to expand capacity of radial tyres at its plant in Puducherry (India) from 300,000 units a year to 400,000 units. The capacity of truck and light commercial vehicles tyres at the Medak facility is set to go up to 100,000 units from the present 80,000 units. At Arakonam, the capacity of two-wheeler tyres will go up to 6,00,000 units from the current 5,00,000 units. In June 2006, MRF set up a greenfield tyre making facility in Colombo (Sri Lanka). This facility is used as an export hub to ship tyres to Pakistan and other countries which have trade agreements with Sri Lanka. Certifications All six manufacturing facilities TS16949/ISO9001 certifications. of MRF are credited with
New Product Developments In the financial year ended 30 September 2010, MRF spent INR175.6m on research and development (R&D) compared with INR 154.6m in the previous year. The company has a team of 300 engineers and scientists working in new product and technology development. MRF is focusing on the development of tyres which meet stringent performance requirement in areas of improving fuel efficiency, rolling resistance and traction. In October 2011, MRF launched its first high-performance tyres called ZLO. The tyre received a V rating and is believed to be safe at speed up to 250km. MRF is targeting premium car tyres segment. In May 2011, MRF launched MRF ZSLK series tubeless tyres in India. The company designed the new premium tyre taking into account the road conditions in India. It uses special silica-based compounds which improve endurance, wet and dry braking. It is also reported to reduce rolling resistance by 10% which helps in considerably improving fuel efficiency. The tyre comes in 175/65 R14 size. In February 2009, MRF launched a new series of tyres branded as MRF Wanderer for sport utility vehicles in 235/70R16, 235/75R15 and 215/75R15 sizes. In 2009-10, MRF launched MRF Steel Muscle S3K4 truck radial tyres which help deliver better mileage on diverse road condition.
Financial Overview In the financial year ended 30 September 2011 MRF reported a 30.6% increase in consolidated net sales to INR97.4bn (USD1.9bn, 30 September 2011) compared with INR74.6bn (USD1.7bn, 30 September 2010) a year ago. The company benefited from strong growth in demand in India, especially during the first half of the financial year. However, the companys performance came under pressure amid moderation in vehicle demand in the second half. The company recorded a profit before tax (PBT) of INR8.9bn (USD179.6m) compared with INR5.4bn (USD119.8m) in the previous financial year, despite a sharp increase in raw material prices. MRFs expenditure on raw materials
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increased 43.4% to INR73.8bn (USD1.5bn) over INR51.5bn (USD1.1bn) in the previous year. The company concluded the financial year with net profit of INR6.2bn (USD124.4m), up 73.1% over INR3.6bn (USD79.4m) in 2010. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales ( INRm) 97,439.8 74,587.3 56,682.9 50,464.5 44,088.9 Net Sales ( USDm) 1,959.0 1,661.5 1,172.6 1,065.8 1,107.5 Profit Before Tax (INRm) 8,931.1 5,380.6 3,962.5 2,102.3 2,594.9 Profit Before Tax (USDm) 179.6 119.8 82.0 44.4 65.2 Net Profit (INRm) 6,187.7 3,575.0 2,507.8 1,445.6 1,703.8 Net Profit (USDm) 124.4 79.4 51.9 30.5 42.8
Outlook MRF has been performing well on the back of strong growth in the automotive market in India. The company has also benefited from surge in exports. In the last five years, the company has almost doubled its sales and quadrupled its pre-tax profit. The company has retained its position as one of the top two leading tire manufacturers in India with 45% domestic market share. This positions MRF well to gain from the growth in the Indian automotive industry. However, like most tyre suppliers, MRFs growth prospects continue to be threatened by spiralling raw material prices. Higher rubber prices have upset the calculations of most of the tyre majors, as natural rubber is the important component in tyre production. Given the pace at which prices are shooting up, tyre makers don't want to depend on domestic production alone to meet the expansion plans. In addition, imports do not seem to be an attractive option this year with international prices running high and the value of the rupee depreciating. In order to cope with the surging input cost, MRF is looking at efficient ways to procure rubber including acquiring and managing rubber estate abroad. The company will use acquisitions to secure raw material supplies and hedge against fluctuations in rubber prices.
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Munjal Auto
Address Munjal Auto Industries 301, 3rd Floor, Galleria Tower, DLF Ph IV, Gurgaon-122002 Haryana India Tel: +91 124 4057 891/892 Fax: +91 124 4057 892 Internet: http://www.munjalauto.com Senior Officers Satyanand Munjal, Chairman Sudhir Munjal, Managing Director Anju Munjal, Whole-time Director Anuj Munjal, Whole-time Director Sharad Srivastava, General Manager, Marketing SK Sharma, General Manager, Finance Products Fuel tanks, seat structure systems, sheet metal components Plants India (3): Gujarat, Haryana, Uttarakhand Sales INR5.2bn (USD114.5m, 31 March 2011) (Year to 31.03.11) Employees c. 1900 (31 March 2011)
Munjal Auto is a Hero Group-owned company manufacturing fuel tanks, seat frames and sheet metal components. In addition, the company produces exhaust systems, steel-wheel rims for twowheelers.
Munjal Auto Industries was established in 1988 as Gujarat Cycles Limited, a joint-venture (JV) between the Hero Group-owned Hero Cycles and Gujarat Industrial Investment Corporation Limited (GICL) to produce bicycles. In 1990s, the Hero Group purchased GICLs stake and shifted its focus to automotive components. The company changed its name to Munjal Auto and its bicycle business was hived off in 2001 to make it purely an automotive supplier. The company produces components for both two-wheelers and four-wheelers. For two-wheelers, Munjal Auto supplies exhaust systems, steel-wheeler rims and spoke wheel rims. For the four-wheelers, the company produces fuel tanks assembly, seat structure systems, side step assemblies and sheet metal components. In addition, Munjal Auto can manufacture complete assemblies involving sheet metal and tubular welded components for four-wheelers including body-in-white (BIW) parts, pillars, cross bars, control arms and tieend bar. Munjal Auto operates three manufacturing plants in India, located in Waghodia, Gujarat; Bawal, Haryana and Haridwar, Uttarakhand. As at 31 March 2011, the company had 1900 employees. Hero MotoCorp, the two-wheeler business of the Hero Group, is the largest customer of Munjal Auto accounting for nearly 85 to 90% of its sales. In addition, the company supplies to GM, Piaggio, Tata Motors and Tata Johnson Controls. Recent Developments Corporate strategy Munjal Auto has made a significant investment in capacity expansion in the past couple of years. The company, which up until 2010 operated only one plant located in Waghodia near Vadodara, Gujarat, opened two greenfield plants in India, one in Bawal, Haryana and second in Haridwar, Uttarakahand. The two plants have been established near the assembly facilities of Munjal Autos main customers Hero MotoCorp. This significantly reduced the companys logistic-related hassles and cuts its transportation costs. The company is focusing on expansion of both product offering and customer base. In 2011 Munjal Auto commenced production of fuel tanks for fourwheelers after the company secured a supply contract from Tata Motors for its Nano car. The company has a technical collaboration with South Korea-based Samsung Industries for the production of fuel tanks for four-wheelers. The contract also expanded the companys customer base. Investments In January 2011, Munjal Auto commenced production of fuel tanks for four-wheelers at its plant in Vadodara, Gujarat (India). The plant has an annual production capacity of 150,000 units of fuel tanks per annum. The plant supplies fuel tanks to Tata Nano. In 2011, Munjal Auto invested in a Central Tool Room at its Bawal Plants in Haryana (India). The company invested INR150m (USD3.3m, 31 March 2011) in the new facility at the plant. In April 2010, Munjal Auto started commercial production at its third plant in Haridwar, Uttarakhand (India). In November 2009, the company started production at its facility in Bawal, Haryana (India).
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Divestments In March 2006, Munjal Auto de-merged its Binola- based Haryana, (India) facility into a separate company Shivam Autotech. Contracts In 2010, Munjal Auto secured a contract from Tata Motors to supply fuel tanks for its Nano car. The company set up a production line at its Vadodara plant to supply Nano. Munjal Auto supplies side step assembly for the Chevrolet Tavera. Certifications Munjal Auto facilities are certified with TS16949 and ISO140001 accreditations. Financial Overview In the financial year ended 31 March 2011 Munjal Auto reported net sales of INR5.2bn (USD114.5m, 31 March 2011), up 78.8% from INR2.9bn (USD64.6m, 31 March 2010) in the previous year. The company witnessed strong surge in sales driven by increased orders from its customers including Hero MotoCorp, the largest customer. Strong growth in sales led the company to record a 45.6% increase in profit before tax (PBT) to INR327.8m compared with INR225.2m (USD5m) in the previous financial year. Munjal Auto concluded the financial year with net profit of INR248.3m (USD5.5m), up 57.2% from INR157.9m (USD3.5m) in 2010. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 5,198.9 2,907.1 2,351.1 2,171.3 2,443.7 Net Sales (USDm) 114.5 64.6 45.1 54.4 56.3 Profit Before Tax (INRm) 327.8 225.2 159.7 153.5 272.9 Profit Before Tax (USDm) 7.2 5.0 3.1 3.8 6.3 Net Profit (INRm 248.3 157.9 112.5 101.6 187.9 Net Profit (USDm) 5.5 3.5 2.2 2.5 4.3
Outlook Munjal Auto has benefited from strong growth recorded by Hero Moto Corp in the past two years. The companys performance particularly during financial year 2011 was impressive, as reflected from a strong jump of 78.8% in sales, driven by significant increase in orders from Hero. The company was able to successfully meet increased demand from its customers, thanks to the timely opening of its two new manufacturing facilities which significantly boosted production capacity at the plant. Although Munjal Auto continues to rely heavily on Hero MotoCorp for its sales, the company is working to diversify its customer base. In 2010, the company secured orders from Tata Motors to supply fuel tanks for Nano. Given the significance of the contract, Munjal Auto invested in new capacity at its Vadodara plant which will allow it to supply Tata Nanos plant in Sanand, also in Gujarat. The company has capability to supply fuel tanks from 15 to 100 litre fuel capacity. Munjal Auto expects supplying Tata is just a beginning and hopes to secure more contracts in this product line from other automakers in coming years.
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Munjal Showa
Shock absorbers
Address Munjal Showa Limited 9-11 Maruti Industrial Area Gurgaon - 122 015 Haryana India Tel: +91 124 234 0427-29 Fax: +91 124 234 1346 Internet: http://www.munjalshowa.com Senior Officers Brijmohan Lall Munjal, Chairman Yogesh Munjal, Managing Director Tetsuo Terada, , Joint Managing Director CM Midha, Head, Marketing, Parts Mahesh Taneja, Vice-President, Finance and IT Products Front forks, gas springs, open stay, rear struts, shock absorbers and window balancers Plants India (3): Haryana (2), Uttarakhand Sales INR12.7bn (USD279.3m, 31 March 2011) (Year to 31.03.11) Employees 3,477 (31 March 2011)
The Hero Group-owned Munjal Showa is the second-largest supplier of shock absorbers and struts to two-wheeler and fourwheeler manufacturers in India. The company generates more than four-fifths of its sales from the two-wheeler segment while the rest comes from the four-wheelers.
Munjal Showa Limited (MSL) was established in 1985 as a joint-venture (JV) between the Hero Group and Japan-based Showa Corporation. The company designs and manufactures shock absorbers and struts for various two-wheeler and four-wheeler manufacturers. The JV operates three plants in India of which two are located in Gurgaon, Haryana and one in Haridwar, Uttarakhand. Munjal Showa started commercial production with an initial capacity of 980,000 shock absorbers and 530,000 front forks per annum. Over the past 25 years, the company has witnessed a manifold increase in installed capacity. As on 31 March 2011, the companys installed capacity increased to 30.5m shock absorbers, 2.4m struts and 0.8m units of window balancers. Shock absorbers contributed about 90% of the total revenue in financial year 2010. During the year, the company sold 27.1m shock absorbers, 1.1m struts and 0.8m window balancers. The companys two major customers include Hero MotoCorp and Maruti Suzuki which together account for 90% of its sales. Munjal Showa also supplies to Honda Motorcycle and Scooter India (HMSI), Honda Siel Cars, Mahindra & Mahindra, Majestic Auto and Yamaha India. In addition the company exports its products to Germany, Japan, the UK and the US. Recent Development Corporate Strategy Munjal Showa continues to depend on Hero MotoCorp for its sales. When the two-wheeler major established a new assembly plant in Haridwar, Uttarakhand, the company also set up its manufacturing plant to continue supplying the former. Munjal Showa expects Hero to be more aggressive in introducing new products, and focusing on international expansion following the end of its 30-year strategic partnership with Honda. This is expected to result in increased orders for the company. Munjal Showa expects to win some sourcing contracts from its Japanese parent partner, Showa Corporation, through leveraging low cost of production in India. The supplier has begun exporting certain components to Showa and its associates for overseas markets. Investments In April 2009, Munjal Showa opened a new plant in Haridwar, Uttarakhand (India). The plant was established with a capital outlay of INR1bn (USD25m, 31 March 2008). It manufactures front and rear cushion, front fork and shock absorbers for 6,000 motorcycles per day, front/rear strut and open stay for Maruti, and front/ rear strut for Honda Siel. In April 2006, Munjal Showa commissioned a new facility in Manesar, Haryana (India) with a capital expenditure of INR360m (USD8m, 30 April 2006). Contracts Munjal Showa supplies Maruti Suzuki Omni van and Honda-Siel City sedan. The company has also added clients like Tata Motors (Indica). It is also developing struts for the new models of cars of Honda Siel and Maruti Suzuki. MSL has been the sole vendor for the export requirement of Maruti
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Suzuki and Honda Motorcycles and Scooter India. Financial Overview For the financial year ended 31 March 2011 Munjal Showa reported a 28.4% increase in net sales to INR12.7bn (USD279.3m, 31 March 2011) compared with INR9.9bn (USD219.4m, 31 March 2010) in the previous year. The company gained from strong sales at its two major customers Hero MotoCorp and Maruti Suzuki in two-wheeler and passenger vehicle segment respectively. Higher sales helped the company to report 23.7% increase in profit before tax (PBT) to INR479.5m (USD10.6m) over INR387.1m (USD8.6m) in the previous financial year. The company posted a 38.2% increase in net profit to INR340.2m (USD7.5m) over INR246.1m (USD5.5m) in the preceding year. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 12,681.7 9,879.2 8,291.2 7,093.8 6,919.0 Net Sales (USDm) 279.3 219.4 158.9 177.8 159.3 Profit Before Tax (INRm) 479.5 387.1 329.0 297.8 396.3 Profit Before Tax (USDm) 10.6 8.6 6.3 7.5 9.1 Net Profit (INRm) 340.2 246.1 206.9 193.2 259.9 Net Profit (USDm) 7.5 5.5 3.9 4.8 5.9
Outlook Like other suppliers of the Hero Group, Munjal Showa has benefited from the strong growth of Hero MotoCorp, the worlds leading two-wheeler manufacturer. The companys new plant in Haridwar, Uttarakhand (India) is expected to help it continue supplying to Hero MotoCorp which operates an assembly plant in the same region. In addition to Hero MotoCorp, Munjal Show hopes to benefit from increased order from Maruti Suzuki. The leading Indian passenger car manufacturer is setting up two assembly plants at its Manesar manufacturing complex which will increase production capacity by 500,000 units. The new plants are expected to become operational by the end of financial year 2013 and will help the automaker meet increase demand. Meanwhile, high prices of raw materials continue to remain a concern for most of the suppliers operating in India, and Munjal Showa is no exception. During financial year 2011, the company witnessed a 30% increase in its expenses on raw materials while sales grew 28%. This stifled earning growth during the financial year. If trends in the high cost of raw material continues, this can impact the company margins.
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Neolite ZKW Lightings

Lighting systems
Address 36, Sector-4B HSIDC, Industrial Area Bahadurgarh - 124 057 Haryana India Tel: +91 127 630 6306 Fax: Internet: http://www.neolitezkw.com Senior Officers Rajesh Jain, Chairman and Managing Director P N Sathees Kumar, Executive Vice-President, Marketing TR Sharma, Senior Vice-President, Sales & Marketing Rajesh Mokashi, Deputy Managing Director Anil Chaturvedi, Associate Vice-President, International Marketing PK Jain, Senior Vice-President Deepak Sharma, Vice-President Products Auxiliary lamps, beacons, corner lamps, front grills, head lamps, plastic components, sheet metal components, side indicators, signal lamps, tail lamps Plants India (3): Haryana (2), Uttar Pradesh Sales INR963m (USD21.2m, 31 March 2011) Employees c. 1,000 (2011)
Neolite ZKW is a major supplier of automotive lighting systems in India. The company supplies its products to both passenger and commercial vehicle segments of the automotive industry. In addition to automotive, the company caters to home lighting sectors.
Neolite began operations five decades ago as an aftermarket supplier as the original equipment (OE) market was very small. However, the company has significantly expanded into the OE segment in the past two decades. Presently, the company operates its business in two segments: Automotive Lighting (accounted for 63% of 2010 sales) and Home Lighting (37%). The company operates three manufacturing plants in India. This includes two plants one in Bahadurgarh and G urgaon, (both in Haryana) and one in Noida in Uttar Pradesh. While the Bahadurgarh plant exclusively caters to OEMs, the Gurgaon plant supplies to the aftermarket. The Noida plant exclusively focuses on Home Lighting business. As of May 2011, the company had a total installed capacity of 7.5 million units of automotive lighting and three million units of home lighting systems. In April 2007, Neolite entered into a 74:26 joint-venture agreement with Austria-based ZKW-Zizala Lichtsysteme to produce lighting systems for passenger cars and commercial vehicles. ZKW has an option to take its equity stake to 40%. Later Neolite transferred its entire automotive business to this new JV. Neolite ZKW supplies to both OEMs and the aftermarket. In addition, the company exports its products to around 80 countries worldwide. Neolite ZKW generates 70% of its sales from OEMs while exports and aftermarket contribute to the remaining 30%. The companys customers among OEMs include AMW, Ashok Leyland, Caterpillar, Eicher Motors, GM, Force Motors, JCB, Kamaz, MAN, Mahindra & Mahindra, Mahindra Navistar, SML Isuzu, Tata Motors, VE Commercial and Volkswagen. Recent Developments Corporate strategy Neolite ZKW is focusing on diversifying its business. The company, which has been a major supplier to commercial vehicles, is now diversifying into the passenger vehicle segment. Neolite ZKW has already made a modest start through commencing supply to GM and Volkswagen. The company is concentrating on improving its new product development capability. In 2007 Neolite entered into a joint-venture (JV) agreement with Austria-based ZKW-Zizala Lichtsysteme to strengthen its technical competitiveness. The JV, Neolite ZKW Lightings, plans to leverage ZKWs technical know-how in areas of advanced automotive lighting systems such as light emitting diode (LED) lighting, adaptive front lighting system (AFS), night vision and pedestrian protection technologies. Within a year after entering into the JV agreement with ZKW, Neolite shifted its entire automotive business operation to Neolite ZKW. The new entity plans to leverage strong new product development capability of its Austrian partner to win business from the latters OEM customers operating in India. The JV is already discussing a supply contract with Daimler India Commercial Vehicles which sources lighting products in Europe from ZKW. In 2010, Neolite ZKW has set up a manufacturing plant in Bahadurgarh, Haryana (India) to cater to OEMs. The company invested INR600m (USD13.2m, 31 December 2010) in a new plant spread over an area of 150,000ft2. Neolite ZKW plans to make an additional investment of INR500m
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(USD11m) in the second expansion phase at the plant. In addition, the company is planning to set up a new plant in western India to supply its customers over the next two years. Neolite ZKW expects to leverage its strategic alliance with ZKW to secure additional business in international markets. For example, ZKW supplies to BMW, Daimler, Volvo, Audi, Porsche and GM in Europe. Neolite hopes to benefit from the strong relation of ZKW with these European automakers to secure supply contracts. Investments In December 2010, Neolite ZKW set up a new manufacturing plant in Bahadurgarh, Haryana (India). The company invested INR600m (USD13.2m, 31 December 2010) in the plant which has annual production capacity of 2.5 million units and exclusively caters to passenger car segment. Apart from production, the new plant in-houses research and development (R&D) and engineering. The company is making an additional investment of INR500m (USD11m) in the second phase of expansion at the plant. Joint-ventures In January 2008, Neolite formed a joint-venture (JV) with Austria-based ZKW-Zizala Lichtsysteme GmbH. The JV, Neolite ZKW Lightings Pvt Ltd manufactures lighting equipment for passenger and commercial vehicles. The two companies signed an agreement for the proposed JV with 74:26 equity in April 2007, with Austrian partner getting an option to increase its stake to 40%. Later Neolite transferred its automotive lighting business to this JV. Certification Neolites manufacturing units have been accredited ISO/ TS 16949 status. Contracts In July 2011, Neolite ZKW secured a contract to supply 80,000 headlamps for the GM-SAIC new car Sail. The company will start supplying in August 2012. Neolite ZKW has also won contracts from the automakers other models including interior light and fog lamps for 40,000 units of Spark, 60,000 units of Beat and 12,000 units of Tavera annually. Neolite ZKW supplies fog lamps for Skoda Fabia. Neolite ZKW supplies lighting systems to Volvo India for its range of buses. Neolite ZKW supplies lighting systems to SML Isuzu for its luxury buses. Neolite ZKW supplies lighting systems to MAN Force for its commercial vehicles. Neolite ZKW supplies lighting systems to Piaggio in India and Italy for its sub one tonne commercial vehicles. Neolite ZKW supplies lighting systems to AMW for its commercial vehicles. Neolite ZKW supplies lighting systems to ICML for its Rhino RX programme. New Product Developments Neolite ZKW has an in-house R&D team at its Bahdurgarh plant. The company aims to spend about 5% its of sales on new product development. Financial Overview In the financial year ended 31 March 2011 Neolite ZKW reported sales of INR963m (USD21.2m, 31 March 2011). Neolite ZKW is a privately-owned company therefore it does not publish the details of its financial results. Outlook Until recently, Neolites supply capability was restricted in the passenger car space due to specific product development capabilities. However, the companys joint-venture with ZKW-Zizala four year ago, together with its shifting of its entire automotive business to this JV, has significantly improved its capability to cater to the passenger car segment. This is reflected from the recent supply orders the company has won from Volkswagen and GM. The automotive lighting market in India is witnessing an increased demand for more value-added fancy lights with increased number of features and aesthetic looks. International trends such as use of xenon and LED in headlamps has so
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far been limited in India due to the high costs involved. However the company expects Indian automakers to adopt these technologies in coming years. Neolite ZKW expects to leverage its Austrian partners technological capability to tap high growth potential in these product lines in coming years.
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NK Minda Group
Horns, switches, lighting
Address Minda Industries Limited Village-Nawada Fatehpur P.O- Sikanderpur Badda IMT Manesar Distt Gurgaon Haryana- 122 004 India Tel: + 91 124 2290 693/698/428 Fax: + 91 124 2290 695 Internet: http://www.mindagroup.com Senior Officers NK Minda, Chairman & Managing Director Anand Minda, Head, Group Finance Vivek Jindal, Head, Group Marketing & Materials Sudhir Jain, Head, Group Strategy Planning VJ Rao, Head, Group, Manufacturing & Engineering NS Warrier, Head, New Projects Vineet Sahni, Executive Director, Lighting Division Ram D Sharma, Executive Director, Minda Autogas Limited Pradeep Tiwary, Executive Director, Minda Acoustics Limited AK Goel, Executive Director, Mindarika Private Limited & Minda Industries Limited, Blowmoulding Division Products Actuators, airbags, batteries, blowmoulding comps, cigar lighters, controllers, CNL/LPG kits, front and rear fog lamps, headlamps, high mounted stop lamps, HLL motors, horns, immobilisers, lighting, locks, mirrors, seat belts, sensors, seating & systems, switches, side indicator lamps, steering wheels, tail lamps, wheel clovers Plants India (21): Delhi, Haryana, Himachal Pradesh, Karnataka, Maharashtra, Tamil Nadu, Uttrakhand Outside India: Indonesia, Vietnam Sales Group: cUSD403m Minda Industries: INR9.5bn (USD210.2m, 31 March 2011) (Year to 31.103.2011) Employees ~6000 (March 2011)
The NK Minda Group is one of the major suppliers of lighting, switches and horns in India. The company supplies its products to two- and three- wheelers and passenger car segments of the automotive industry.
The NK Minda Group started operations in 1958. Over the period the company has emerged as a major supplier of auto components in India. The Group consists of the following companies: Minda Industries: the flagship company of NK Minda Group. The company supplies switches for two- and three-wheelers and off- road vehicles. In addition, it manufactures batteries for two-, three- and fourwheelers and off-road vehicles. The company operates eight manufacturing plants in India and Association of Southeast Asian Nations (ASEAN) and employs 2,800 people. MIL Lighting: the lighing division of Minda Industries. The company makes lighting products for two-, three- and four-wheelers. In addition, the company supplies to off-road vehicles. Mindarika: 63:37 joint-venture between Minda Industries and Japan-based Tokai Rica. It is a major supplier of switches for the four-wheeler segment in the automotive industry. Minda Acoustic: manufactures horns for two-, three- and four wheelers. Minda Accoustic also supplies to off-road vehicles. Minda Autogas: Formerly known as Minda Impco, the company supplies CNG/LPG kits and other alternate fuels systems to the automotive industry. PT Minda ASEAN Automotive: Minda has set up a greenfield plant in Indonesia. The palnt is managed by PT Minda ASEAN Automotive. The plant produces switches and locks for two-wheelers. In addition to Indonesia, the subsidiary supplies to other markets in the ASEAN region, including Malyasia, Philippines and Thailand. Minda Autocar: This is sales and service company of NK Minda Group serving to aftermarket.
In addition, the NK Minda Group operates other companies incuding Minda Emer Technologies (for CNG/LPG kits), Toyoda Gosei Minda India (for airbags, steering wheels and body sealing parts), Tokai Rika Minda India (for seat belts, locks and immobilisers) and Kosei Minda Aluminum (for alloy wheels). The NK Minda Group has 23 manufacturing plants in India, Indonesia and Vietnam. Of these, the company runs 21 facilities in India which are located in Delhi, Haryana, Himachal Pradesh, Karnataka, Maharashtra, Tamil Nadu and Uttrakhand. The NK Minda Group caters to two-wheelers, four wheelers and off-road vehicles. The companys major customers include Ashok Leyland, Bajaj Auto, Fiat, Ford, Eicher, GM, Hero MotoCorp, Honda Motor Cycle India, Honda Seil Cars, Hyundai, Mahindra, Maruti-Suzuki, Renault-Nissan, Royal Enfield, Suzuki Motorcycle, TVS Motors, Tata Motors, Toyota, Volkswagen and Yamaha. The company also supplies its overseas customers, including Aprilia, Bosch, BMW, Ford, Kawasaki, Komatsu, Mitsubishi, PSA Peugeot Citron, Piaggio, Polaris, Renault, and Volkswagen. Recent Developments Corporate Strategy NK Minda Group has been focusing on broadening its product portfolio in the past few years. The company, which is a major supplier of switches horns and lighting products, has forayed into new business areas such as alloy wheels, filtration systems, blow-moulding plastic parts and safety system components through entering into strategic alliances with the global suppliers.
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Some of the companys diversification of its portfolio has been driven by its customers. For example, the company entered into a joint-venture agreement with Kosai Aluminum to produce alloy wheels for the two Japanese automkers operating in India Nissan and Toyota Kirloskar Motor. The JV has already secured contracts to supply 300,000 alloy wheels to various models produced by these two automakers in India. NK Minda entered into another JV with JBM Group to supply die-casting components for Honda Motorcycle & Scooter India (HMSI). Divestments In May 2010, the NK Minda Group divested its 33.3% stake in a jointventure company, Valeo Minda Electrical Systems India Private Limited, to the other partner Valeo. The French supplier earlier had a 66.7% stake in the JV, based in Pune, Maharashtra (India), which was engaged in the supply of automotive electrical systems. Following takeover of Mindas stake, Valeo changed the name of the wholly-owned subsidiary to Valeo Engine and Electrical Systems India Private Ltd. In November 2010, NK Minda discontinued its technical licence agreement with Taiwan-based TYC Brothers. Joint-ventures In December 2011, NK Minda Group entered into a joint-venture agreement with Japan-based Toyoda Gosei and Toyota Tusho Corporation to supply automotive safety components such as airbags, body sealing parts and steering wheels, for the Indian car market. The JV will be 82.1% owned by Toyoda Gosei, 5% by Toyota Tusho and 12.9% by NK Minda Group. The JV, to be named Toyoda Gosei Minda India Pvt Ltd, is expected to begin operations by May 2012 from the NK Minda Groups manufacturing plant in Neemrana, Rajasthan (India). The JV intends to set up its own manufacturing plant in Bangalore within two years. In October 2011, Minda Industries, the flagship company of the NK Minda Group, entered into a joint-venture agreement with Kyoraku Company Limited and Nagase & Company to manufacture blow moulding plastic components for the automotive industry. Minda will have a 74% stake in the JV while Kyoraku and Nagase will hold 16% and 10% respectively. The company has not provided further details of the JV. In January 2011, NK Minda Group formed a 50: 50 joint-venture with Toyo Roki based in Japan to produce filtration components including air and oil cleaners. The JV will set up a manufacturing plant in Bawal, Haryana (India) spread over five acres. In December 2010, NK Minda Group and Japan-based Kosei Aluminum formed a joint-venture to manufacture aluminium wheels for automobiles. The JV, 40% owned by Minda and 60% by Kosai and named Kosei Minda Aluminum Co Ltd, will develop and manufacture aluminium alloy wheels and precision aluminium die casting parts for major automakers. The two partners will set up a manufacturing plant near Chennai, Tamil Nadu (Inida) which is expected to become operational by mid-2012. The plant will have an initial production capacity of 300,000 aluminium alloy wheels which will be doubled to 600,000 units in 2014. Kosei and Minda will start with a capital of INR500m (USD10.8m, 17 December 2010). The total investment amount is INR8.4bn (USD181.9m). Minda has invested INR50m in the JV. In 2010-11, NK Minda entered into a joint-venture agreement with JBM Group to produce die casting components for Honda Motorcycle & Scooter India (HMSI). In October 2009, NK Minda Group formed a joint-venture with Italybased Emer S.p.A to manufacture alternative fuel systems and components. The JV named as Minda-Emer Technologies Limited, will invest INR400m (USD8.3m, 1 October 2009) over a period of three years including setting up a manufacturing plant in Manesar, Gurgaon, Haryana (India). Under the terms of the agreement, Emer will provide technological support and will assist in the design and testing, while Minda will be responsible for production and marketing support. By 2012, the plant will have an annual production capacity of 500,000 parts, including 120,000 systems and kits. In June 2008, NK Minda Group announced its second joint-venture with Japan's Tokai Rika. The JV company, Tokai Rika Minda India Pvt Ltd (TRMIPL) manufactures automotive seat belts, locks and immobilisers. Tokai Rika owns a 70% stake while the balance 30% is owned by the Minda Group. The new collaboration invested INR1bn (USD23.3m, 30
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June 2008) in a greenfield facility in Bangalore, Karnataka (India) to supply seat belts, locks and immobilisers to Toyota Kirloskar Motors. Mindas existing JV with Tokai Rika - Minda Rika Pvt Ltd (MRPL) produces automotive switches for four-wheelers and mirrors. The NK Minda Group holds a 60% stake in MRPL while Tokai Rika has 35% and the remaining 5% is held by Sumitomo of Japan. In February 2007, Minda Industries along with AK Minda Group commissioned a joint design center at Tokyo (Japan) to ensure that the two companies could be involved in projects initiated by Japan based OEMs from the design stage across product categories in the two groups.
Investments In September 2011, NK Minda Group inaugurated a new manufacturing facility in Manesar, near Gurgaon Haryana, (India). The facility will produce painted wheel covers for Indian automakers. The plant has installed an annual production capacity of 600,000 units. The company invested INR50m (USD1m, 30 September 2011) in the facility which is expected to become operational by January 2012. The production and supply of painted wheel covers will be managed by the two separate jointventure companies of the group. While Mindarika will be responsible for manufacturing the painted wheel covers, Tokai Rika Minda India will look after its supplies to OEMs. In April 2011, NK Minda Group opened a Design Centre in Taiwan. The centre will help the Indian supplier in the design and development of innovating automotive lighting products. The company invested USD783,000 in the design centre. In September 2008, Minda Industries opened a plant at Bidadi, near Bangalore, Karnataka (India) to manufacture blow moulding parts. The total investment in the plant amounts to INR250m (USD5.68m, 1 September 2008), of which INR100m (USD2.27m) has already been invested. The company has a technical collaboration with the Indonesian company Kyoraku at this facility, and supplies parts to Toyota Kirloskar Motors, and other automakers. The factory, which was built on a two-acre plot, has a covered area of 40,000ft2 and an installed capacity of 600,000 parts per annum. Contracts In July 2011, NK Minda secured a contract to supply around three 300,000 alloy wheels for Toyota and Nissan for models including Etios, Etios Liva, Innova and Micra. The company will produce the components at its new facility in Chennai, Tamil Nadu (India) with plans to start shipments in 2011. NK Minda Group entered into a joint-venture agreement with Kosei Aluminum in 2010 to start production of alloy wheels at the jointly owned Chennai plant. In August 2008, Minda Industries announced that it had been chosen to supply headlamps and rear combination lamps to Volkswagen for the Polo starting 2009. In May 2008, Minda Industries signed a deal with Volkswagen for supplying headlights and rear combination lamps. The contract is worth INR600m (USD14m, 27 May 2008). The lighting components will primarily be supplied for the Polo and rear combination lamps for a vehicle being produced in Russia. Minda supplies Marutis A-Star, Swift, Swift Dzire, Zen Estilo and SX4 with lighter, HVAC panel, switches and ashtray. Minda announced that it was supplying components including blower switch, signal switch, hazard switch, light switch and batteries to Tatas Nano. Minda Impco supplies CNG fuel kits to the Maruti Suzuki Zen Estilo program. Minda Impco supplies CNG kits for Hino trucks in Pakistan and Bangladesh with about 300 kits per year. New Product Developments Minda Industries spent INR151.5m (USD3.3m, 31 March 2011) on research and development (R&D) compared with INR103.3m (USD2.2m) spent during fiscal 2010. The R&D expenditure during the financial year 2011 was equivalent to 1.7% of the companys sales. Minda Industries has engineering, research and development centers in Bangalore, Karnataka; Manesar and Sonepat, Haryana; Pantnagar, Uttrakhand and Pune, Maharstra (all in India).
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NK Minda Group opened a Design Centre in Taiwan in April 2011. The centre will help the Indian supplier design and develop innovative automotive lighting products. Minda has recently developed the following new products : In December 2008, Minda Industries introduced a four-wheeler variant of its automotive battery Vroom. The extended range includes Vroom 48 (32Ah and 35Ah), Vroom 36 (32Ah and 35Ah) and Vroom 24 (32Ah, 35Ah, 50 Ah and 60Ah). Mindarika developed a ride control mechanism switch for Bajaj CT 100. Minda FIAMM developed a new horn for Tata Motors to tackle the problem of vibration resonance of bracket in vehicles. Minda FIAMM has also developed horn with two-strip/ bent bracket horn for Suzuki Indonesia. Minda FIAMM has developed a new horn with improved acoustical features for Bajaj Auto. The company has also developed a new horn for TVS Motors. Financial Overview In the financial year ended 31 March 2011 Minda Industries, the flagship company of the NK Minda Group, reported a 52.6% increase in consolidated net sales to INR9.5bn (USD210.2m, 31 March 2011) compared with INR6.2bn (USD1388m, 31March 2010). The company benefited from the strong growth of all segments in the industry including twowheelers, passenger vehicles and off-road vehicles. Higher top line growth allowed the company to record similar growth in earnings during the financial year. Minda reported profit before tax (PBT) of INR477.5m (USD10.5m) compared with INR312.7m (USD6.9m) in the previous financial year. Minda Industries concluded the financial year with net profit of INR355.3m (USD7.8m), reporting an increase of 51.8% over INR234.1m (USD5.2m) in 2010. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 9,541.5 6,251.9 4,445.3 3,961.0 3,866.1 Net Sales (USDm) 210.2 138.8 85.2 99.3 89.0 Profit Before Tax (INRm) 477.5 312.7 209.8 197.7 213.6 Profit Before Tax (USDm) 10.5 6.9 4.0 4.9 4.9 Net Profit (INRm) 355.3 234.1 151.7 157.2 135.3 Net Profit (USDm) 7.8 5.2 2.9 3.9 3.1
Outlook NK Minda Group is foraying into new product lines as the company continues to search new avenues for growth. Meanwhile, the company continues to strengthen its dominance in its main business area of switches, horns and lighting products. This twin strategy of the company is expected to ensure its growth in the automotive segment in coming years. Besides venturing into new areas of business, NK Minda Group is focusing on broadening its customer base which is expected to reduce its dependence on any single customers or segment of the automotive industry. Despite moderation in vehicle sales in the financial year 2012, NK Minda is investing in additional capacities. For example, the company is setting up a new plant in Bawal Haryana (India) to produce blow moulding components. These capacity expansion projects are expected to help the company to prepare itself for the next growth phase in the Indian automotive industry.
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NRB Bearings
Needle roller bearings
Address NRB Bearings Limited Dhannur, 15 Sir P.M. Road, Fort Mumbai 400 001 Maharashtra India Tel: +91 22 2266 4160/ 4998 Fax: +91 22 22660412/2267 9850 Website: http://www.nrbbearings.com Senior Officers Trilochan Singh Sahney, Chairman Harshbeena Singh Zaveri, President & Managing Director DS Shaney, Whole-time Director Manfred Vogel, Senior Vice-President, Manufacturing Operations Heinz H. Kamping, Vice-President, International Business Development Jyotsna Sharma, CFO & Vice-President, Information Technology Pradeep Chaudhary, Vice-President, Sales & Marketing Prabir Ray, Vice-President, Competency Development Ramesh Matkar, Vice-President, Projects & Logistics Sumit Mitra, Vice-President, International Business & Supply Chain Strategy Arvinder S Kohli, Director & Vice President, NRB Bearings (Thailand) Ltd. Products Ball bearings, bottom roller bearings, cam followers, crank pins, cylindrical roller bearings, full - complement needle bearings, needle bushes, needle cages for connecting rod applications, needle cages & roller cages, needle rollers, needles with cage guided needles, pin kits, inner rings, precision steel balls, spherical roller bearings, tapered roller bearings, thrust bearings Plants India (7): Andhra Pradesh, Jharkhand, Maharashtra (4), Uttrakhand Outside India: Thailand Sales INR4.7bn (USD103.5m, 31 March 2011) (Year to 31.03.2011)
NRB Bearings is the leading manufacturer of needle roller bearings in India. The company also makes other types of bearings. The company supplies mainly to the automotive industry. In addition to automotive, the company caters to the textile machinery, switchgear, hand tool and consumer durable industries.
NRB Bearings was incorporated in 1966 as the Needle Bearing Company, in a joint-venture between France-based Nadella (with 26% stake) and Indian promoters, the Sahney family (59% stake). The company was the first to produce needle roller bearings in India. Over the years the company has diversified into production of other types of bearings such as cylindrical roller bearings, ball bearings tapper roller bearings and spherical roller bearings. Owing to its diverse product range, the company changed its name as NRB Bearings in 1990. In November 2005, the Sahney family bought out Timken SAS/ Nadella's holding in the company. NRB Bearings operates seven manufacturing plants in India and one in Thailand. Of the seven plants in India, the company has four in Maharashtra, and one each in Andhra Pradesh, Jharkhand and Uttarakhand. The companys plant in Thailand is located in Rayong. The company supplies its products to two-wheelers, three-wheelers, passenger cars, commercial vehicles and off-road vehicles. NRB Bearings supplies around 65% to 70% of its products to OEMs, while the remainder is supplied to aftermarket and exports. NRB Bearings customers include Ashok Leyland, Bajaj, Daimler, Delphi, Eicher Motors, Getrag, Hero MotoCorp, MAN, Mahindra & Mahindra, Marut Suzuki, Meritor, Piaggio, TAFE, Tata Motors, TVS Motors, Volvo and ZF. The company exports its products to some 26 countries including France, Germany, Iran, Japan, Sri Lanka and the US.
Recent Developments
Corporate strategy NRB Bearings has set a goal to become a USD1bn company by 2020 with presence in all major markets worldwide. In June 2010, the company announced plans to invest INR500m (USD10.8m, 30 June 2011) in capacity expansion addition and new product development. Usually, the company invests IRN200m (USD4.3m) in capacity expansion every year. However, strong growth in demand for its products during the year led the company to increase its annual capital expenditure budget during the year. Meanwhile, the company is focusing on exports to counter lower margins in the domestic market. The influx of Chinese and Thai made bearings have significantly hurt the pricing power of the company despite its higher quality of products. To offset the adverse effect of the India-Thailand Free Trade Agreement (FTA), NRB Bearings commissioned a greenfield facility in Thailand in October 2008. The facility is helping the company secure new contracts from OEMs based in the region. Needle roller bearings and cylindrical roller bearings are the highest growing segments in the bearing industry. NRB is trying to penetrate the lucrative aftermarket which returns higher margins. The company is specifically focusing on the semi-urban and rural markets. Divestments In October 2011, NRB Bearings demerged its industrial bearings undertaking into a newly formed entity named NRB Industrial Bearings Limited.
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Employees NRB: c.1,350 (2008)
Investments In June 2010, NRB Bearings announced plans to invest INR500m (USD10.8m, 30 June 2011) in capacity expansion addition and new product development. In October 2008, NRB commissioned a new bearing manufacturing facility in Rayong (Thailand). The company invested INR300m (USD5.7m, 31 October 2008) in the manufacturing plant which has an installed capacity of 30m bearings per annum. In 2008, NRB started its greenfield manufacturing facility at Pant Nagar, Uttarakhand (India). The company invested INR 250m (USD6.2m, 31 March 2008) in the manufacturing plant. The unit has an installed capacity of 22m ball and roller bearings per annum. The company supplies to nearby plants of Bajaj Auto and Tata Motors. Certifications NRB Bearings plants are accredited with ISO ISO/TS16949:2009, ISO14,001:2004 and OHSAS certifications. 9001:2008, 18001:2007
New Product Developments NRB Bearings spent INR37.2m (USD819,423, 31 March 2011) on research on development (R&D) in the financial year ended 31 March 2011. Focusing on the R&D side of the business, NRB intends to expand its product offerings and to develop high precision automotive components in the future. Financial Overview In the financial year ended 31 March 2011 NRB Bearings reported a 34.2% increase in consolidated net sales of INR4.7bn (USD96.3m,31 March 2011) over INR3.5bn (USD78.3m) during the same period in 2010. As a standalone company, NRB Bearings reported 33% increase in domestic sales to INR4.3bn (USD82.4m) while exports surged by 53% to INR405.6m (USD7.8m). The company witnessed a significant increase of 44% in expense on raw materials. Despite this NRB Bearing profit before tax (PBT) more than doubled to INR815.5m (USD18m) over INR345.4m (USD7.7m). The companys net profit during the financial year also more than doubled to INR535.4m (USD11.8m) over INR217.2m (USD4.8m) in the previous year. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 4,374.0 3,526.8 2,920.2 3,285.9 3,104.7 Net Sales (USDm) 96.3 78.3 56.0 82.4 71.5 Profit Before Tax (INRm) 815.5 345.4 83.9 529.9 618.8 Profit Before Tax (USDm) 18.0 7.7 1.6 13.3 14.2 Net Profit (INRm) 535.4 217.2 26.2 346.5 417.1 Net Profit (USDm) 11.8 4.8 0.5 8.7 9.6
Outlook NRB Bearings enjoys a strong market presence in India and
commands a significant pricing premium over its competitors in the local aftermarket. However the influx of Chinese and Thai bearings has significantly affected NRBs supplies to the replacement market leading to a considerable reduction in pricing. Citing lower sales growth in India, the company has embarked on a significant drive to increase its thrust on exports. The companys facility in Thailand is expected to help NRB to explore business opportunities in ASEAN which have traditionally been Japanese strongholds.
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Omax Auto
Address Omax Auto Limited Plot No. 26, 4-Bays Institutional Area, Sector - 32 Gurgaon - 122001 Haryana India Tel: +91 124 4343000/4341000 Fax: +91 124 2580016 Internet: http://www.omaxauto.com Senior Officers Suresh Mathur, Chairman Jagdish Kumar Mehta, Managing Director PK Bansal, President & CFO Manoj Mishra, President & CEO, Passenger Cars Kishor Karnataki, President & CEO, Commercial Vehicles NC Kaushik, President & CEO, Two-Wheeler KC Chawla Whole Time Director Products Axle shafts, body frame, chain cases, chassis frame assembly, cross members, front axles, front fork, gear shafts, mufflers, oil pump assemblies, panel assemblies, piston rods for shocks and struts, rocker arm shafts, seat parts, sprockets, steering shafts Plants India (8): Haryana (6), Karnataka (1) Uttar Pradesh Sales INR11.6bn (USD254.8m, 31 March 2011) (Year to 31.03.11) Employees c. 2,035 (March 2011)
Omax Auto is one of the major suppliers of sheet metal parts, machined tubular and electroplated and painted components for two-wheelers, passenger cars and commercial vehicles. In addition to automotive, the company caters to home furnishings and railways.
Incorporated in 1983 Omax Auto manufactures sheet metal tubular and machined components for the automotive industry. The company operates 10 plants in India, including eight which cater to the automotive industry. Of the eight automotive plants, six are located in Haryana and one each in Karnataka and Uttar Pradesh. Besides the company has two dedicated plant in Haryana, of which one supplies home furnishings and another for railways. The company supplies its products to both automakers and tier one suppliers. Omax Autos OEM customers include Ashok Leyland, Hero MotoCorp, Honda Motorcycle & Scooter India, Honda Siel Cars, International Tractors, Magneti Marelli, Maruti Suzuki, New Holland Tractor, Piaggio, RenaultNissan, Suzuki Motorcycle, TVS, Tata Motors and Toyota. The company also caters to tier one supplies including Bharat Seats, Cummins, Delphi, Denso, Honeywell, Jay Bharat Maruti, Krishna Maruti, Lucas-TVS, Mitsuba, Sundram Clayton, Tenneco Automotive and WABCO.
Recent Developments
Corporate strategy Omax Auto continues to diversify its business. The company which started as a supplier to the two-wheeler segment of the automotive industry now supplies to passenger cars and commercial vehicles. In 2009, the company commenced production of chassis at its new plant in Lucknow, Uttar Pradesh (India) for Tata Motors commercial vehicles. Omax Auto is also tapping the export markets to de-risk its business. In the past few years, the company has been able to make some breakthrough in this regard by adding certain European and South East Asian clients. More recently, the company has ventured outside the automotive industry and is now supplying to railways and home furnishing industries. In financial year 2011, the company successfully commenced commercial production at its Bawal plant to manufacture home furnishing stainless steel products. The company also shifted the railway division from Gurgaon to Faridabad, both in Haryana (India), in order to enhance capacity to produce components for Indian Railways. Investments In February 2007, Omax Auto invested INR1bn (USD22.7m, 15 February 2007) in a new facility in Lucknow, Uttar Pradesh, (India) to supply chassis to Tata Motors for its commercial vehicles. The company commenced supplies in 2008 as a single source supplier for various commercial vehicle programmes with an installed capacity of 100,000 units per annum. The plant commenced commercial production in 2009. In July 2006, Omax Auto announced plans to invest INR350-400m (USD7.5-8.6m, 31 July 2006) to expand its facility in Bangalore, Karnataka and commission newer lines and machinery in its facilities in India. Contracts Omax Auto supplies chassis components for Tata Motors at its Lucknow plant in Uttar Pradesh (India). The company has been producing chassis parts for LCVs like Canter- Mitsubishi Mahindra & Mahindra selected Omax to supply machined parts. Omax Auto manufactures several assemblies for Maruti-Suzuki like panel side body, panel assembly cowl upper, member floor, cross member and sill floor side.
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The company manufactures frame assembly installation and extension components for the Honda City. Omax Auto produces door beams for front and rear doors for the Maruti 800. Omax also manufactures beam steering hanger for the Honda City.
Certifications Omax Auto has been accredited with ISO 9001 and TS 16949 status.
Financial Overview In the financial year ended 31 March 2011, Omax Auto generated net sales worth INR11.6bn (USD254.8m, 31 March 2011), an increase of 33.3% compared with INR8.7bn (USD192.1m, 31 March 2010) in the previous year. The company benefited from strong growth in vehicle production at its key customers including Hero MotoCorp which account for nearly half of the two-wheelers sold in India. The company recorded a profit before tax (PBT) of INR315.3m (USD6.9m) against INR204.4m (USD4.5m) in 2009. Net profit increased 48.9% to INR212.9m (USD4.7m) compared to INR143m (USD3.1m) in the preceding year.
Omax Auto generates nearly 70% of its sales from the two-wheeler segment. In financial year 2011, the companys sales from the two-wheeler segment increased by 26.2% to INR8.3bn (USD182.8m) over INR6.6bn (USD146.6m) in the previous financial year. The company recorded manifold increase in sales to commercial vehicle segment to INR1.1bn (USD24.2m) compared with INR82.4m (USD1.8m) in the previous year. Omax Auto benefited from fullyear operation at its Lucknow plant in Uttar Pradesh (India) which caters to Tata Motors. The companys sales in the passenger car segment increased 2.3% to INR569.1m (USD12.5m) compared with INR556.2m (USD12.2m) in the preceding year. For financial year 2011-12, Omax Auto is expecting net sales to be around INR13.5bn (USD297.4m). Although the company has witnessed some moderation in demand in the passenger car segment during the financial year, it expects strong growth in other segments including two-wheelers and commercial vehicles. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 11,568.2 8,650.9 8,156.9 7,143.5 6,895.5 Net Sales (USDm) 254.8 192.1 156.3 179.0 158.7 Profit Before Tax (INRm) 315.3 204.4 90.2 235.8 363.2 Profit Before Tax (USDm) 6.9 4.5 1.7 5.9 8.4 Net Profit (INRm) 212.9 142.1 67.7 161.0 260.3 Net Profit (USDm) 4.7 3.1 1.3 4.0 6.0
Outlook Omax Auto has registered a significant growth over the past five years with sales crossing INR10bn mark for the first time in financial year 2011. The company has also recorded strong recovery in earnings after registering decline in financial year 2009 amid global economic slowdown. Omax Autos ambitious de-risking plan through diversifying its business has made a strong start with the Tata Motors contract to supply chassis on a single source basis. Currently, the company is a key supplier of Hero MotoCorp, Maruti Suzuki and Tata Motors, the three automakers who are leaders in twowheeler, passenger cars and commercial vehicles. As a major supplier to these automakers, Omax Auto is well positioned to benefit.
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Panasonic Automotive
Infotainment systems and electronics
Address Panasonic Automotive Systems Company 4261 Ikonobe-cho, Tsuzuki-ku Yokohama-city Kanagawa 224-8520 Japan Tel: 81 45 939 6111 Internet: http://www.panasonic.co.jp/pas Regional Address Panasonic Automotive Systems Company of America 776 Highway 74 South Peachtree City, GA 30269 USA Senior Officers Fumio Ohtsubo, President Masahisa Shibata, President Automotive Systems Shiro Kitajima, COO, Panasonic Corporation North America Masato Ito, Senior Vice-President, President Energy Products Car Multimedia: Audio speakers and amplifiers, navigation systems, AV and rear seat entertainment systems, CD, DVD, MD and SD, navigations systems, Energy & Safety: Acceleration sensors, batteries, cameras. compressors, electronic components (sensors, switches, capacitors, resistors), engine control devices, knock sensors, motors, cameras, on vehicle emergency call system, on vehicle ETC, electronic control unit Plants North America: Mexico, USA (3) Outside North America: China (5), Czech Republic, Germany, Japan (3), Taiwan, Thailand Sales Group:JPY8.7trn(31.03.2011) 31 March 2011) (USD104.9bn,
Panasonic Automotive supplies automotive navigation and car audio visual equipment and systems. It also sells related devices that help in environment and energy conservation and security in the automotive sector.
Panasonic Automotive Systems Company (PAS) was created in January 2003 as a new division of Matsushita Electric Industrial (MEI) through the integration of the companys various automotive electronic subsidiaries involved in automotive electronics, automotive systems business, communication, automotive multimedia and car navigation systems business. Panasonic operates its business under six business segments: Components and Devices (accounted for 9% of 2011 sales): semiconductors, general components (capacitors, tuners, circuit boards, power supplies, circuit components, electromechanical components, speakers, etc.), batteries and electric motors Sanyo (16%): car navigation systems and lithium-ion batteries Digital AVC Networks (33%), car AVC equipment Home Appliances (13%) PEW and PanaHome (17%) Others (12%) Following the acquisition of Sanyo, Panasonic is adopting a new business structure from January 2012. The company will operate in three business divisions: Components & Devices, Consumer and Solutions. Automotive Systems and Energy devices will be in the components and devices business sector. The companys subsidiary in the USA is known as Panasonic Automotive Systems Company of America. The subsidiary was established in 2003 and is involved in developing car audio, business phones and PBX. Recent Developments Corporate strategy Panasonic has devised a mid-term management plan called GT12 (Green Transformation 2012) for three years, initiated in May 2010. The aim of the plan is to achieve JPY10trn (EUR84.5bn, 7 May 2010) in sales, 5% or more in operating profit to sales ratio, a three-year accumulative total of over JPY800bn (EUR6.76bn) in free cash flow, 10% return on equity (ROE), and a 50m tonne reduction in CO2 emissions. Panasonic is aiming for sales of JPY1.5trn (USD18bn, 21 February 2011) by fiscal 2018 through automotive related business including car navigation systems and lithium-ion batteries for hybrid and electric vehicles. Panasonic plans to achieve this by stepping up marketing of products for Japanese automakers and capitalising on growing demand for automobiles in China, India and other emerging economies. Panasonic is moving aggressively towards being a prominent battery supplier for the automotive industry. Rechargeable batteries have lately witnessed a burgeoning demand in light of increased production of hybrid and electric models. In order to capitalise on the emerging market for rechargeable batteries, Panasonic acquired almost 80% stake in Sanyo in October 2010. The development has given a new boost to Panasonics automotive battery business by giving access to Sanyos clientele. In December 2010, the company announced plans to make Sanyo its wholly-owned subsidiary through a share
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exchange. Employees 366,937 (Year to 31.03.11) (Consolidated) Sanyo has been supplying nickel-metal hydride batteries for hybrid electric vehicles (HEVs) to Honda and Ford since 2004. The company is now focusing on lithium-ion batteries and aims to capture 40% of the global market for rechargeable vehicle batteries by 2020. The company forecasts an eightfold increase in global demand for cars with electrified drivetrains by 2021, to around 11m vehicles. Sanyo is also pursuing joint development of nextgeneration nickel-metal hydride and lithium-ion battery systems with automakers such as Volkswagen and PSA Peugeot Citron. In May 2010, the company announced it would invest JPY120bn (USD1.28bn, 11 May 2010) in its rechargeable battery business for a period of three years. In October 2010, Sanyo announced plans to boost output capacity of lithium-ion batteries at its new plant in Kasai (Japan) to 10-fold in 2015. Panasonic Automotive has also collaborated with Fender Musical instrument Corp. on premium automotive audio systems that will be featured in select Volkswagen models from 2012. The system features Panasonic speaker technology and is embedded in vehicle design. In addition Panasonic and Garmin have been collaborating in navigation and multimedia device which saw Panasonic named supplier of the system control unit for Chryslers Unconnect system. Acquisition In October 2010, Panasonic completed a tender offer to raise its holding in subsidia Sanyo to more than 81%. In December 2009, Panasonic acquired 50.2% stake in Panasonic. In July 2010, Panasonic had annouced a JPY818.4bn (USD9.88bn) plan to buy remaining shares in Sanyo as well as another subsidiary Panasonic Electric Works which makes lighting equipment for homes and offices. Joint-ventures In June 2011 Panasonic Automotive Systems Company of America and AT&T announced a partnership for research and development of in-car mobile technology. As part of the agreement the two companies will work together to create customized products for carmakers operating in North America in areas such as infotainment and interfaces for mobile devices. In January 2010, Panasonic announced plans to collaborate with Tesla to develop the next-generation battery cells for electric vehicles. Tesla plans to use Panasonic's battery cells in its newest battery packs. The cells comprise nickel-based lithium-ion chemistry which is preferred by Tesla for electric vehicle (EV) applications In January 2008, Panasonic Automotive Systems Company of America announced a joint-venture with Garmin International to collaborate on navigational projects targeting OEMs. Both companies will continue to pursue independent initiatives as well as working jointly on selected OEM projects. In January 2007, with the recent success of the ELS Surround(R) in-car audio system, Panasonic Automotive Systems Company of America formed a working agreement with Fender Musical Instruments Corporation to develop custom audio systems for the automotive market. Investments in North America In December 2010, Panasonic announced it was to make Sanyo a wholly-owned subsidiary through a share exchange. Panasonic previously held an 80.77% share of the business. Sanyo will form part of the components & devices sector. In November 2010, Panasonic invested USD30m in Californian luxury electric carmaker Tesla. Panasonic bought Teslas common stock in a private placement at a price of USD21.15 per share. The investment allows Panasonic to acquire a 2% stake in the carmaker and marks the beginning of a multi-year collaboration, aimed at accelerating market penetration of electric vehicles (EVs). Tesla already uses Panasonics cells in its battery packs. In addition, Tesla builds electric powertrains,
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including battery packs, for other automobile manufacturers. With this deal, the companies intend to explore opportunities for joint marketing and sale of battery packs Investments outside North America In Decembr 2010, Sanyo announced completion of a new technical facility for lithium-ion batteries on the premises of Tokushima plant located in Itano-gun, Tokushima (Japan). Construction of the facility began in May 2010. This site will become Sanyos main technical development centre for lithium-ion batteries. It was set up with an investment of JPY3bn (US$35.7m, 1 December 2010). In November 2010, Panasonic invested USD30m in Californian luxury electric carmaker Tesla. Panasonic bought Teslas common stock in a private placement at a price of US$21.15 per share. The investment allows Panasonic to acquire 2% stake in the carmaker and marks the beginging of a multi-year collaboration, aimed at accelerating market penetration of electric vehicles (EVs). Tesla already uses Panasonics cells in its battery packs. In addition, Tesla builds electric powertrains, including battery packs, for other automobile manufacturers. With this deal, the companies intend to explore opportnities of joint marketing and sale of battery packs. In May 2010, Sanyo announced plans to increase investment to develop rechargeable batteries and solar cells to more than USD2.13bn. The company plans to undertake mass production of lithium-ion batteries at all its factories by 2012. In July 2010, Sanyo opened a new lithium-ion battery factory in its plant in Kasai (Japan). The facility is spread over an area of 42,831m2. The new facility will manufacture one million cells per month initially. Sanyo invested JPY13bn (EUR114.3, 30 July 2010) to construct the new facility. In May 2009, Sanyo announced it would construct a new facility in its Kasai Plant (Japan) to manufacture lithium-ion batteries for hybrid and electric vehicles. The plant manufactures one million lithium-ion batteries cells per month. In June 2008, Matsushita Battery Industrial Co., Ltd., a subsidiary of Panasonic, announced it would establish a lithium-ion battery plant in Osaka City (Japan) with an investment of JPY100bn (USD928m, 30 July 2008). The plant was constructed in two phases. The first phase of the plant began in December 2008. The company will have a production capacity of 600m lithium-ion battery cells anually after the completion of the second phase. Additionally, Matsushita Battery announced plans to invest JPY23bn (USD213m) in its two plants in Osaka and Wakayama Prefectures (Japan) to improve productivity. In December 2006, Panasonic Automotive Systems Company established Panasonic Automotive Systems Asia Pacific (Thailand) Co Ltd. (PASAP). With the establishment of a new technology development department, the company formulated a product development system aimed at meeting the needs of local consumers. Divestments outside North America In February 2011, Panasonic announced it would sell its automotive nickel-hydride (NiMH) business to Hunan Corun New Energy Co, a Chinese manufacturer of advanced batteries. The deal was thought to be around JPY500m (USD6.09m, 1 February 2011). The companys nickelhydride business operates out of the Shonan plant in Chigasaki (Japan) and manufactures batteries for electric vehicles for Honda and Japan. In June 2010, Pansonic divested part of its share in its joint-venture with Toyota Motor called Panasonic EV Energy. At the time of inception, Panasonic held a controlling stake in the venture but now Toyota holds an 80.5% stake in the JV. The venture has also been renamed Primearth EV Energy Co.
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Contracts OEM/Brands Toyota Toyota Chevrolet Model iQ Prius Plug-in hybrid Silverado (2011) Components Display-Audio system Batteries Back-up Camera, rear seat audio controls, rear seta video screen monitor, dual play DVD/Radio, steering wheel switeches Silverbox radio, integrated centre stack, 8 touch display Speakers & subwoofer Steering wheel switches Silverbox radio, 7 display Integrated center stack 7 LCD navigation display Integrated centre stack spent JPY527.8bn
Buick Ford Toyota Chevrolet Saab Buick Cadillac
LaCrosse (2009) Mustang (2009) Avalon (2012) Cruze (2010) 9-4x (2010) Regal (2011) SRX (2009)
New Product Developments. In 2011 Panasonic (USD6.4bn), or 6.1% of sales on R&D expenditure.
In June 2010, Panasonic, through its subsidiary Panasonic Ecology Systems Co Ltd, has developed a new alkali-metal based catalyst for diesel engine exhaust systems, the new catalyst can potentially reduce the usage of platinum metal to 20% reducing cost of production and allowing combustion levels at 20% lower temperature lowering energy consumption. Mass production if expected to start in 2012, with the company targeting sales worth JPY20bn (USD220.5m, 23 June 2010) by FY2018. In December 2009, Panasonic Corporation announced the development of two new 18650-type (18 mm in diameter, 65 mm in height) highcapacity lithium-ion battery cells for electric vehicles. The company used nickel based positive electrode technology as well as its material and processing technology to prevent deformation of the alloy-based negative electrode when subjected to repeated charge and discharge. In July 2009, Panasonic announced plans to develop a new battery for cars equipped with an idling-stop function. The company is also considering mass production of such batteries, and aims to produce batteries for one million cars by fiscal 2015. Additionally, Sanyo has partnered with PSA Peugeot Citron and Volkswagen to develop nickelmetal hydride and lithium-ion batteries for hybrid electric vehicles. In May 2009, Panasonic Electric Works, a subsidiary of the company, announced plans to develop new applications for its highly heat-resistant copper-clad-laminates and related prepregs used in the electronic devices mounted in hybrid electric vehicles.
Financial Overview No separate financial figures for Panasonic Automotive Systems are given. For the financial year ended 31 March 2011 Panasonic reported a 17% increase in net sales to JPY8.7trn (USD104.9bn) up from JPY7.5trn, (USD80.0bn). 48.3% of sales came from overseas with the remaining 51.7% of sales achieved domestically. Operating profit rose 60% to JPY305.3bn (USD3.7bn) from JPY190.5bn (USD2.1bn) and net income increased to JPY74.0bn (USD893.2m) from a net loss of JPY103.5bn (USD1.1bn.) Segment wise components and devices sales declined to JPY926.3bn (USD11.2bnbn) from JPY931.5bn (USD10.0bn). Sanyo sales increased to JPY1,561.9bn (USD18.8bn) up from JPY404.8bn (USD4.4bn). Sales increased in all geographic regions. In the Americas sales increased to JPY1,070.8bn (USD12.9bn), in Europe sales increased to JPY857.2bn
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(USD10.3bn) and in Asia and China sales increased to JPY2,250.4bn (USD27.2bn). Following the Japanese earthquake Panasonic lowered its financial forecasts for the year ending March 31 2012. Panasonic has projected a net income of JPY30bn (USD374.4m, 20 June 2011), and an operating profit of JPY270bn (USD3.37bn). Sales however are expected to increase to JPY8.7trn (USD108.6bn). Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (JPYm) 8,692,672 7,417,980 7,765,507 9,068,928 9,108,170 Net Sales (USDm) 104,895 80,023 79,818 91,336 77,236 Operating Income (JPYm) 305,254 190,453 72,873 519,481 459,541 Operating Income (USDm) 3,683 2,054 749 5,231 3,896 Net Income (JPYm) 74,017 (103.465) (378.961) 281.877 217.185 Net Income, (USDm) 893.1 (1,116) (3,895) 2,838 1,841 R&D Expenditure (JPYm) 527,798 476.903 517.913 554.538 578.087 R&D Expenditure (USDm) 6,369 5,144 5,323 5584 4,902 No. of Employees 366,937 3,84,586 2,92,250 3,05,828 3,28,645 No. of Employees 366,937 3,84,586 2,92,250 3,05,828 3,28,645
Outlook Panasonic aims to substantially improve sales and profitability with its newly formed mid-term management plan GT12 which is due to complete in 2012. However, the plan is focused on green innovation and is subject to various risk factors. The company has set ambitious targets such as achieving an operating profit ratio of 5% or more, ROE of 10% and CO2 emission reduction of 50m tons. In the lithium-ion rechargeable battery business, Panasonic aims to achieve sales exceeding JPY1trn (USD11.6bn, 4 August 2010) and over 40% market share in the global market by 2016. The companys series of efforts, ranging from strategic acquisitions to partnerships, may help it achieve these goals. The company needs to bring sizeable increase in production of batteries in order to stay abreast in the flourishing industry. Sanyo, in particular, is a significant acquisition. However, the two companies will have to undertake restructuring to create a robust portfolio of battery and related products targeting the automotive industry. The partnership with Tesla is also a significant development for Panasonic. Tesla is gradually undertaking expansion efforts to establish itself as an electric powertrain components manufacturer. The company has won contracts from renowned automakers such as Daimler and Toyota. The advancement of Tesla in powertrain component and battery business may also bring in growth prospects for Panasonic. The potential of the market for lithium-ion batteries also draws a promising picture for Panasonic. Global demand for lithium-ion batteries is expected to reach JPY3.2trn (USD34.5, 30 March 2010), more than five times the current level, by 2019. Panasonic is geared to get a large share of the market. In a recent statement, the company said it was in talks with over 20 automakers worldwide to initiate battery deals. Moreover, the companys plan to focus on future technologies such as lithium-ion batteries and divestment of its nickelhydride (NiMH) business will help it to achieve its growth target.
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Pricol
Automotive and other components
Address Pricol 702 Avanashi Road Coimbatore 641 037 Tamil Nadu India Tel: +91 422 433 6000 Fax: +91 422 4336299 Internet: www.pricol.com Senior Officers Vijay Mohan, Chairman and CEO K Udhava Kumar, President, COO K Ramesh, Vice-President, CFO Vanitha Mohan , Executive Director VG Ratnam, Senior Vice-President, Business Development K Janardhanan, Senior Vice PresidentManufacturing Engineering and Production Products Brake light switches, centralised lubrication systems, clocks, digital tachograph, engine speed sensors, EGR valves, fuel level sensors, gauges, hour meters, hydraulic cabtilting pumpand cylinder assembly, idle speed control valves, instrument clusters, low oil pressure switches, manifold absolute pressure (MAP) sensors, oil pumps, power sockets, pressure sensors, road speed limiter, speed sensors, temperature sensors, top dash tacometers, warning indicators, windshield waster systems, vacuum switching valves, vehicle convenience and security systems, vehicle tracking systems Plants India (6): Haryana, Maharashtra, Tamil Nadu (2), Uttrakhand (2) Outside India: Indonesia Sales INR8.1bn (USD179.3m, 31 March 2011) (Year to 31.03.11) Employees 4,600
Pricol is a major supplier of instrument clusters, oil pumps, power sockets and various sensors in India. The company caters to two-wheelers, three-wheelers, passenger cars, commercial vehicles and off-the-road (OTR) vehicles. The company havs a 46% market share in the automotive instrument business in India.
Pricol was established in 1972 at Coimbatore, Tamil Nadu (India) and started commercial production in 1975. The company started as a supplier of automotive instruments with an initial annual capacity of 400,000 dashboard instruments. The company presently operates seven manufacturing plants in India, including two each in Coimbatore, Tamil Nadu and Rudrapur, Uttarakhand and one each in Gurgaon, Haryana and Pune, Maharashtra. In addition the company operates one manufacturing plant in Karawang, Indonesia to supply to local units of TVS Motors and Bajaj Auto and to Denso for its Phillipines and Thailand based plants. Pricol has a broad customer base which includes manufacturers of two-wheelers, three wheelers, passenger vehicles, buses and trucks, tractors and construction equipment. The companys major customers include Ashok Leyland, Bajaj Auto, Eicher Motors, GM India, Hero MotoCorp, Honda Motorcycle & Scooter India, Maruti Suzuki, Mahindra & Mahindra, SML Isuzu, Tata Motors, Toyota Kirloskar, TVS and Yamaha Motors. The company also supplies to some leading suppliers including Denso and Visteon. In addition to the domestic market, Pricol exports its products to Australia, Canada, Egypt, Europe, Mexico, Middle East, New Zealand, South America, Turkey and the US. Recent Developments Corporate Strategy: Pricol is focusing on business diversification in order to reduce its overdependence on the automotive industry, which presently accounts for nearly 95% of its sales. The company has formulated a mediumterm plan called Vision 2016 under which it aims to generate about a third of its sales from non automotive business in the next five years. Pricol is concentrating more on engineering service, real estate and travel business for future growth. The company plans to strengthen its presence in the travel business through some selective acquisitions. The company has set a goal to achieve sales of INR17bn (USD374.5m) by 2016. Meanwhile, Pricol is working to enter into new product lines in the automotive business. In addition, the company intends to focus more on high-margin subassembly business and outsource an increasing amount of component manufacturing operations to its suppliers. Besides, the company will work in the area of localising its customer base to reduce its transportation costs. Joint-ventures In January 2006, Pricol Technologies formed a joint-venture CarceranoPricoltech India Pvt Ltd with Italian firm Carcerano Srl. to provide a complete range of design, styling and product engineering to the Indian automotive industry.
Investments In October 2007, Pricol established an office in Japan to facilitate the development activities with Japanese OEMs in conjunction with its R&D centre in India. In 2007, Pricol commissioned its first manufacturing facility at Pant Nagar to cater to Bajaj Auto at a capital cost of INR 200m
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(USD4.60m, 31 March 2007). The plant has an installed capacity of one million sets of speedometers, fail sensors, gear systems and oil pumps. Also in 2007, Pricol commenced production at its second facility at Pant Nagar. The plant will have an installed capacity of one million sets of instruments and field sensors for Tata Motors and Mahindra & Mahindra. In April 2007, Pricol commissioned a plant at Karawang, Indonesia with a capital investment of INR 180m (USD4.38m, 30 April 2007) to supply to local units of TVS Motors and Bajaj Auto and to Denso for its Phillipines and Thailand based plants. The plant manufactures 0.85m sets of instrument clusters for Bajaj & TVS, while the balance is supplied to Denso. Also in 2007, Pricol completed the purchase of the balance 30% shares in English Tools & Castings making it a fully owned subsidiary. In December 2006, Pricol announced a joint-venture with Nava Khodro to supply instrument clusters in Iran for the Saipa and Iran Khodro at a capital cost of INR 38.2m (USD0.9m, 31 December 2006). The plant commenced production by March 2008.
Divestments In May 2011, Pricol announced plans to hive off its auto instrument cluster business of its Pune plant in Maharashtra to a wholly-owned subsidiary, which will be set up for this purpose. The company board has approved the transfer of the business, assets and liabilities related to instrument cluster business of the plant to the subsidiary company. The move, subject to the approval of shareholders, would facilitate finding a global supplier which could bring in the latest technology.
Contracts In 2008, Pricol supplied instrument clusters for Hondas Accord and City programme. In 2007, Pricol supplied instrument clusters for Marutis SX4 programme. In 2007, Pricol won a 100% supply contract from Magyar Suzuki for the supply of instrument clusters to the Suzuki Splash programme in Hungary with an order size of 140,000 units per annum. Also in 2007, Pricol won a supply order from Toyota India for supplies to its small car programme in India. Pricol is the sole supplier of MAP sensors to Maruti. Pricol exports speedometers to Suzuki, Thailand. Pricol supplies instrumentation for Maruti vehicles.
New Product Developments Pricol spent INR287.49m (USD6.33m, 31 March 2011) on research and development (R&D) in the financial year ended 31 March 2011. This was equivalent to 3.5% of its sales. Pricol is presently developing crank position sensor, cam position sensor, engine gas recirculation valve and lubrication oil pumps. Some of the companys development works include Electronic tachograph: Pricol has developed an electronic tachograph which records the movement of the vehicles in the previous 24 hours. The reports generated by the systems can be used as a legal acknowledgment in the case of an accident. The system records various parameters like speed, distance and time. Pricol developed this product for an overseas company with whom it has a buyback arrangement with its Indian counterpart. However the company also intends to launch the product in the Indian markets. The government rules demand that tachographs be fitted to vehicles carrying hazardous material. Centralised Lubrication System: provides a solution to avoid manual error and increased costs, by lubricating the vehicle automatically at the required points with the required quantity and moreover at required intervals. The system can be fitted in all CVs and off-road vehicles. RSL: is a Micro-controller based electronic device that constantly monitors the speed of the vehicle and governs the speed within the set speed limit. The device has application in commercial vehicles. Vehicle Monitoring System: It is an on-board computer system that
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provides essential vehicle information for better fleet control. The OBD generates trip sheets, over-speeding, stoppage, heavy acceleration and heavy braking reports, last minute graphs and maintenance schedules and keeps track of service history. The Vehicle Monitoring System can be fitted in all HCVs, MCVs & LCVs. Certificates Pricol has been accredited with ISO 14001, ISO/TS 16949 AND OHSAS 18001certificates.
Financial Overview In the financial year ended 31 March 2011, Pricol reported net sales of INR8.1bn (USD179.3m, 31 March 2011), an increase of 9.7% from INR7.4bn (USD164.9m, 31 March 2010) in the previous year. The company recorded an increase in domestic sales of 11.4% to INR8bn (USD176.5m), however, witnessed a decline in exports 8.3% to INR1.1bn (USD23.4m). Despite an increase in sales the company witnessed a decline in earnings due to sharp increase in manufacturing expenses, especially in cost of raw materials and electronic components. Pricol recorded a 21.4% decline in profit before tax (PBT) to INR215.7m (USD4.7m) compared with INR274.6m (USD6.1m) in the previous financial year. Net profit also fell by 9.3% from INR254.8m (USD5.7m) in 2010 to INR231.15m (USD5.09m) in 2011. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 8,140.9 7,423.9 6,141.8 6,064.6 5,833.8 Net Sales (USDm) 179.3 164.9 117.7 152.0 134.3 Profit Before Tax (INRm) 215.7 274.6 (382.8) 218.3 508.1 Profit Before Tax (USDm) 4.7 6.1 (7.3) 5.5 11.7 Net Profit (INRm) 231.1 254.8 (300.2) 190.8 362.1 Net Profit (USDm) 5.1 5.6 5.7 4.5 8.3
Outlook Pricol continues to remain under the shadow of prolonged labour strikes over four years ago which resulted in the sad death of one of its senior executives. Since then the company has lost its market share and several projects related to development of new products which were equipped in vehicles recently launched. However, the company is making efforts to rectify this situation, in order to regain the lost market shares. Even in the automotive business Pricol is working to reduce its dependence on its core instrument cluster business. The company believes that the conventional instrument cluster business will lose its shine in the medium- to long- term given the rate at which technology is changing. Todays vehicles are being equipped with innovative technologies such as multi-functional displays and computer read-outs, which leaves little scope for conventional instrument business. In order to deal with the technology challenge, the company announced a plan in May 2011 to hive off its instrument cluster business in Pune, Maharashtra as a separate subsidiary to attract a global supplier who could bring in new technology. Despite some expected recovery in its main automotive business, Pricol is deliberately working to reduce its exposure to the industry. Therefore the company is shifting its focus to non-automotive business in engineering services, reality and travel. The company expects to generate a third of its sales from non-automotive business over the next five years.
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Ramakrishna Forgings
Forgings and machining components
Address Ramakrishna Forgings Limited L & T Chambers, 6th Floor 16, Camac Street Kolkata-700017 West Bengal India Tel: +91 33 3984 0999 Fax: +91 33 3984 0998 Internet: http://www.ramakrishnaforgings.com Senior Officers M P Jalan, Chairman Naresh Jalan, Managing Director Pawan Kumar Kedia, Finance Director Alok Kumar Sharda, CFO Rajat Dutta, Vice-President Products Forging and machining components Plants India (3):Jharkhand (2), West Bengal Sales INR4.1bn (USD90.2m, 31 March 2011) Employees 1,500 (March 2011)
Ramakrishna Forgings is a major forging and machining components supplier in India. The company supplies its products to automotive, earthmoving & mining, oil exploration and general engineering sectors.
Ramakrishna Forgings was incorporated in 1981. The company currently operates three manufacturing plants in India of which two are located in Jharkhand and one in West Bengal. Ramakrishna Forging caters to several industries including automotive, earth moving and mining, oil exploration, railways and general engineering. In financial year 2011, the company generated 70.4% of its sales from automotive industries, 5.7% from railways, 3.4% from mining, 11.3% from exports and 9.1% from others including scrap. In automotive the company supplies to both automakers and tier one suppliers. Ramakrishna Forgings customers among automakers include Ashok Leyland, Eicher, Hindustan Motors, TAFE, Tata Motors and Volkswagen Group. Among tier one suppliers the company supplies to American Axle & Manufacturing, Federal Mogul, Meritor, NBC Bearings and Timken. Recent Developments Corporate Strategy: Ramakrishna Forgings has not invested in new facilities for a long time, but the company is now investing in expanding capacities at all three of its manufacturing facilities in India to meet increasing demand from its customers. During the financial year 2011, the company expanded annual forging capacity by 10.6% to 34,100 tonnes. The company also increased billet cutting facilities by importing fully automatic horizontal bandshow machines from Japan. Ramakrishna Forgings further intends to ramp up its raw material cutting facilities to facilitate smooth flow of production and reduce cost of operations. The company also enhanced its machining facility by procuring CNC Gear hobbing machines from Japan and Korea. This is expected to help the company offer more value-added products to its OEM customers. The company is focusing on diversifying its business to reduce its dependence on the automotive business which accounts for more than two-thirds of its total sales. Even in automotive business, the company generates most of its sales from the commercial vehicle segment. Ramakrishna Forgings is focusing on mining sector to de-risk its business. In addition, the company is also making inroads in farm equipment sectors. Besides the company is concentrating more on strengthening exports. The company which generated 11.32% of 2011 sales from exports in focusing more on expanding international presence. The company is targeting new markets and customers to expand its exports. Certificate Ramakrishna Forgings facilities are ISO/TS 16949 certified. Financial Overview In the financial year ended 31 March 2011 Ramakrishna Forgings reported a 43.8% increase in net sales to INR4.1bn (USD90.2m, 31 March 2011) compared with INR2.8bn (USD63.3m, 31 March 2010) in the previous year. The company benefited from strong growth in the commercial vehicle segment in India which recorded a 27.3% increase in sales to 676,400 units. During the financial year Ramakrishna Forgings recorded a 17.9% increase in forging and machining (including job work) to 31,234.5 tonnes compared with 26,487.2 tonnes in the prior year.
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Higher sales led the company to double its profit before tax (PBT) to INR333.1m (USD7.3m) over INR163.5m (USD3.6m) in the previous fiscal. The company concluded the financial year with a net profit of INR220.6m (USD4.9m), more than double compared with INR108.9m (USD2.4m) in financial year 2010. Year 2011 2010 2009 2008 Net Sales (INRm) 4,096.8 2,849.6 2,290.0 2,000.7 Profit Before Tax (INRm) 333.1 163.5 73.8 202.6 Net Profit (INRm) 220.6 108.9 45.4 130.3
Year 2011 2010 2009 2008
Net Sales (USDm) 90.2 63.3 43.9 50.1
Profit Before Tax (USDm) 7.3 3.6 1.4 5.1
Net Profit (USDm) 4.9 2.4 0.9 3.3
Outlook Ramakrishna Forgings has recorded strong growth in the past four years with sales more than doubling to INR4bn (USD90.2m) in financial year 2011. Although the company has recorded strong recovery in earnings after it witnessed sharp decline in financial year 2009, the growth has remained under pressure mainly due to sharp increase in expenses. For example in the financial year 2011, the company recorded 45.2% increase in raw materials costs, 33.3% in power and fuel costs and 33.8% in wages costs. The company is working to improve its profitability through improving manufacturing efficiency. The company sees the forging business as having strong growth potential in India. Forging is common for many industries, and with this in mind, the company is diversifying into other sectors such as mining and farm equipment. The company already supplies to Indian railways. This should help the company to have a balanced product portfolio and a diversified customer base. In automotive, Ramakrishna Forging hopes to benefit from growing outsourcing of auto component production to low cost countries. According to the company the global auto component industry is expected to touch USD1.7trn by 2015, while outsourcing to low cost countries should reach USD700bn. India, as a major source of low cost manufacturing, is expected to benefit from this trend. This is expected to create tremendous growth opportunities for the local forging suppliers such as Ramakrishna Forgings.
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Rane Brake Linings

Friction materials
Address Rane Brake Linings Limited Plot No. 30 II Main Road Ambattur Industrial Estate Chennai-600 058 Tamil Nadu India
Rane Brake Linings is one of the leading producers of friction materials in India. The company supplies brake linings, clutch facings and disc pads to major tier one suppliers of passenger cars, utility vehicles, commercial vehicles and farm tractors. In addition to automotive, the company supplies to railways.
Rane Brake Linings (RBL) was established in 1964 with a technical agreement with Small & Parkers (UK). In 1982, the company entered into an agreement with Laylock Engineering, a GKN subsidiary, to expand its range of clutch linings. RBL supplies its products to major tier one suppliers and automakers. The companys main customers include Amalgamations Repco, Automotive Axles, Brakes India, Caterpillar, Clutch Auto, Kalyani Brakes, LuK India, Mando Brake Systems and Tatra Udyog. Among automakers the companys major customers include Ford, GM, Maruti Suzuki, Nissan and Tata Motors. In addition to the domestic market, the company exports its products to 15 countries including Australia, Bangladesh, Fiji, Israel, Japan, Mauritius, Middle-East, Sri Lanka and the UK. Recent Developments Corporate strategy RBL is focusing on improving margins through better capacity utilisation and enhancing manufacturing efficiency. In the past four years, the company has not set up any new manufacturing plants, but has ramped capacity at its existing plants. The company plans to improve its exports as international OEMs are increasingly looking at a lower cost base to safeguard their margins. The company has been able to offer localisation solutions to major international customers for their new programmes. The potential to add more domestic customers has also been strengthened, which should lead to more revenues. The company has intensified its focus on R&D and plans to supply new, higher value- added products to improve its margins which have been put under pressure due to higher input costs. The company has invested in new manufacturing technologies for disc pads and brake linings for passenger cars and utility vehicles to enhance product quality. Joint Ventures Rane Brake Linings has a technical and financial tie-up with Nisshinbo Industries, Japan. The latter holds 10% equity in the company. RBL has a technical tie-up with TMD Friction, UK, for production of railway brake blocks. Investments In June 2008, Rane Brake Linings started the first phase of its new manufacturing unit at Trichy, Tamil Nadu (India) to supply asbestos free brake pads to Maruti Suzuki, Tata Motors, Toyota, Honda and Nissan. Built at an investment of INR250m (USD5.83m, 30 June 2008) the plant has an installed capacity of two million disc pads per annum, which is planned to be scaled up to 10 million pads by 2013. Contracts RBL is the supplier to the Tata Nano model in 2009. RBL has been appointed as a single source supplier for the Chevrolet Tavera. Certifications RBL has been accredited with ISO 9000:2008, TS16949:2009, OHSAS 18001:2007 and ISO 14001:2004 certifications.
Tel: +91 44 26250566/ 42215501 Fax: +91 44 2625 0769/ 8883 Internet: http://www.rane.co.in/rbl/
Senior Officers L Ganesh, Chairman L Lakshman, Director P S Rao, President MAP Sridhar Kumar, General Manager, Finance A Rajasekaran, General Manager, Marketing Products Asbestos and non-asbestos brake linings, clutch facings, disc pads, sinter brake pads Plants India(4): Andhra Pradesh, Pondicherry, Tamil Nadu (2) Sales INR3.1bn (USD67.4m, 31 March 2011) (Year to 31.03.11) Employees 893 (31 March 2011)
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New Product Developments In the financial year 2011, RBL spent INR INR58.4m (USD1.3m) on research and development compared with INR46.8m (USD1m) in the previous year. The companys expense on R&D was about 1.9% of its sales during 2011. RBL is developing new friction materials to meet customer requirements as well as on development of asbestos free friction products for domestic aftermarket. Besides, the company is working to enhance product quality and process technology. Financial Overview In the financial year ended 31 March 2011, RBL reported net sales of INR3.1bn (USD67.4m, 31 March 2011), up 29.7% compared with INR2.4bn (USD52.5m, 31 March 2010) in the previous financial year. The company witnessed a strong growth in demand for its products in the domestic market as well as in exports. The company sales in the domestic market increased by 31% compared with the previous financial year while exports surged 5% to INR158.8m (USD3.5m). The company recorded profit before tax of INR196.7m (USD4.3m), an increase of 31.7% over INR149.3m (USD3.3m) in 2010. RBL concluded the financial year with net profit of INR152.8m (USD3.4m), up 51.5% from INR100.9m (USD2.2m) in 2010. Year 2011 2010 2009 2008 Year 2011 2010 2009 2008 Net Sales (INRm) 3,058.4 2,363.0 1,913.5 1,810.2 Net Sales (USDm) 67.4 52.5 36.7 45.4 Profit Before Tax (INRm) 196.7 149.3 43.2 111.9 Profit Before Tax (USDm) 4.3 3.3 0.8 2.8 Net Profit (INRm) 152.8 100.9 28.9 89.4 Net Profit (USDm) 3.4 2.2 0.6 2.2
Outlook RBL expects to benefit from increased demand for its products in the medium to long run. Vehicle sales in India are expected to triple by 2020 to nearly nine million units. As a major supplier of friction materials to automakers and tier one suppliers operating in India, RBL is well-positioned to gain from this trend. The company has recorded a strong recovery after its margin came under pressure in financial year 2009 due to economic slowdown. However, RBL continues to see limited growth in margins amid high prices of raw materials such as steel. The company continues to focus on improving manufacturing efficiency to offset negative impact of high raw material prices.
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Rane Engine Valves

Engine valves
Address Rane Engine Valves Limited Level-5, Anmol Palani 88 GN Chetty Road T Nagar, Chennai-600 017 Tamil Nadu India Tel: +91 44 2815 3182 Fax: +91 44 2815 5626 Internet: http://www.rane.co.in/rbl/ Senior Officers L Ganesh, Chairman & Managing Director Harish Lakshman, Vice-Chairman L Lakshman, Director G Ramkumar, President K Sankaranarayanan, General Manager, Finance and Secretary K S Kasturirangan, Vice President, Finance Products Clutch actuators, engine valves Plants India(5): Andhra Pradesh (2), Tamil Nadu (3) Sales INR2.8bn (USD63.5m, 31 March 2011) (Year to 31.03.11) Employees 1,331(31 March 2011)
Rane Engine Valves, a part of the Rane Group, is a major supplier of engine valves and valvetrain components in India. The company supplies its products to two-wheelers, passenger cars, utility vehicles, commercial vehicles and farm tractors.
Rane Engine Valves Limited (REVL) was established in 1959 to manufacture valve and valvetrain components for various engine applications. The company operates five manufacturing facilities in India of which three are located in Tamil Nadu and two in Andhra Pradesh. As of 31 March 2011, the company had 1,331 employees. In July 2011, TRW Automotive reduced its stake in Rane Engine Valve. The company sold half of its total 9.78% stake for nearly INR59.2m (USD1.3m, 1 July 2011) to Enam Shares and Securities Ltd. TRW Automotives stake now stands at 4.89%, after selling 252,000 shares at INR235 (USD5.2) per share REVL supplies to domestic customers including Ashok Leyland, Cummins India, Eicher Motors, Escorts, Hero MotoCorp, Hindustan Motors, Hyundai India, Mahindra & Mahindra, Maruti Suzuki, Tata Cummins, Tata Motors and TVS Motors. In addition, the company exports its products. REVLs international customers are Deutz, New Holland Tractors, TRW and Volkswagen. Recent Developments Corporate strategy REVL continues to focus on its core business area of engine valves and valvetrain components. During the past decade the company divested its camshaft business to concentrate more on engine valves products. In the past couple of years the company has secured several key supply orders from its customers including Hyundai, Mahindra & Mahindra and Volkswagen. To meet these orders effectively and efficiently REVL has set up dedicated production lines at its manufacturing plants. Like most of the suppliers operating in India, REVLs performance has also come under pressure due to consistently rising prices of raw materials, as well as increase in wages and other operating expenses. The company has taken several initiatives to improve cost savings and enhance manufacturing efficiency. Investments In June 2011, Rane Group announced to invest INR486m (USD10.6m, 20 June 2011) in capacity expansion at manufacturing facilities operated by REVL through 31 March 2012. In May 2010, REVL announced plans to invest INR300m(USD6.64m, 15 May 2010) to add two new production lines at its plant at Trichy in Tamil Nadu (India) to supply exhaust valves to Volkswagen. Of the two lines, one will cater to Volkswagen's 1.6L engines being produced in Germany and the other for its requirements for Brazil. In February 2010, REVL commissioned its dedicated line for manufacturing valves for Kappa engines of Hyundai Motor at its Trichy facility, Tamil Nadu (India). The initiative will strengthen REVL's manufacturing capacity to supply valves for 400 Kappa engines per day. The company made an additional investment to enhance the capacity of the new line further to cater to the requirements of 550 Kappa engines a day. The investment, which totalled over INR120m (USD2.59m, 19 February 2010) excluding land and building cost, includes new improved machines in forging, heat treatment and machining, and spreads over an 8,000ft2 floor. In January 2008, REVL inaugurated a new manufacturing facility to produce engine valves at Pudukottai district near Trichy in Tamil Nadu. The facility has been set up at a cost of INR355m (USD9.02m, 28 January 2008) and will produce six million valves in phase one. In the next three to five years the production capacity at the plant is expected to increase to 25 million valves per year. The facility will employ 45 employees initially
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which will be scaled up in phases. Contracts REVL supplies engine valves for Hyundais Kappa engines. REVL supplies engine valves to Mahindra & Mahindras Farm Equipment. Certifications REVL has been accredited with QS 9000, ISO 14000 and TS 16949 certifications for all four production facilities. New Product Development REVL spent INR5.1m (USD112,120, 31 March 2011) on research and development (R&D), up 63.3% % from last years figure of INR3.1m (USD69,220, 31 March 2010). The companys expense on R&D during financial year 2011 was equivalent to 0.2% of its sales. Financial Overview In the financial year ended 31 March 2011, REVL reported net sales of INR2.9bn (USD63.5m, 31 March 2011), an increase of 22.1% over the previous year's sales of INR2.4bn (USD52.4m, 31 March 2010). The company benefited from strong demand for its products in India. REVLs sales in the OEM segment reported a year-over year increase of 22%, while the company recorded a 13% increase in sales in the aftermarket segment over the previous financial year. In addition, REVL gained from the recovery in some major international markets in North America and Europe which led it to record a 29% increase in exports compared with the preceding year. Higher sales combined with continuing focus on improving cost efficiency led the company to report a profit before tax of INR161.2m (USD3.6m) compared with INR70m (USD1.6m) in 2010. REVL concluded the financial year with a net profit of INR108m (USD2.38m) over INR43m (USD0.9m) in the same period in the previous year. Year 2011 2010 2009 2008 Year 2011 2010 2009 2008 Net Sales (INRm) 2,884.5 2,360.1 2,202.4 1,982.7 Net Sales (USDm) 63.5 52.4 42.2 49.7 Profit Before Tax (INRm) 161.2 70.0 39.1 41.0 Profit Before Tax (USDm) 3.6 1.6 0.7 1.0 Net Profit (INRm) 108.0 43.0 22.1 24.2 Net Profit (USDm) 2.4 0.9 0.4 0.6
Outlook REVL has reported a consistent growth in sales in the past few years though its earnings came under pressure briefly during the global economic slowdown. However, in the past two financial years the company has reported a strong turnaround in profit driven by higher revenue and continuing focus on cost discipline. The company is a major supplier of engine valves and enjoys its position as preferred suppliers for automakers and suppliers, especially in southern India. In union budget 2011-12, the government of India changed the definition of completely-knocked down (CKD) kit. Under the new definition, the CKD kit with preassembled major components, such as engine, gearbox, transmission and chassis, will be treated as completely-build unit (CBU) and attract a higher import duty of 60%, significantly up from the previous 10%. The government introduced this change to encourage local assembly and production of major components such as engines and transmissions. As a major supplier of engine valve and valvetrain components, REVL is well positioned to grow from this change in CKD definition.
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Rasandik
Sheet metal components, assemblies and subassemblies and tools & dies
Address Rasandik Engineering Industries India Limited C-4 & 5 First Floor C- Block Commercial Complex Paschim Marg, Vasant Vihar New Delhi- 110 057 India
Rasandik Engineering Industries is a major supplier of sheet metal components and tooling to the automotive industry. The company is the first Indian supplier of tailor welded blanks in the domestic market. In addition to automotive, the company also supplies to the white goods sector.
Rasandik Engineering Industries India Limited was incorporated in 1984 initially with the objective of localising production and supply of complicated toolings, which were largely imported by the automotive industry. In 1986, Rasandik added sheet metal components to its product range. Rasandik classifies its business under two heads: Sheet metal components, assemblies and sub-assemblies, and Tools and dies. In addition, the company has diversified in complete vehicle assembly and makes three-wheelers from its Greater Noida plant in Uttar Pradesh (India). Rasandik supplies components to most of the automakers operating in India. The companys major customers include Fiat India, GM India, Hindustan Motors, Honda Siel, Maruti Suzuki, New Holland, Renault, SML Isuzu, Tata Motors and TVS Motors. The company supplies press tools and dies to GM, Hero, Honda Motorcycle & Scooter India, Maruti Suzuki, Mahindra & Mahindra, Maruti Suzuki, Tata Motors, Toyota and TVS Motors. In addition, Rasandik supplies tailer-welded blank (TWB) to Ashok Leyland, Force, Mahindra & Mahindra, Tata Motors. Recent Developments Corporate strategy Rasandik has invested in setting up the first Tailor Welded Blank (TWBs) facility in India. Passenger cars in developed markets use around 14 TWBs per vehicle. Rasandik expects Indian vehicles to use around four TWBs per unit by 2011. Being the sole vendor specialising in TWBs, Rasandik expects strong revenue growth with healthy margins. Rasandiks prospects are further propelled by the fact that both Maruti-Suzuki and Tata Motors have initiated programmes to reduce overall weight per vehicle, and the use of TWBs could help them achieve a significant reduction in weight for most compression bearing sheet metal components used in the body panel. The company is one of the few suppliers in India which has gone for forward integration. Rasandik, which supplies various auto components and has significant presence in TWB, tools & dies, is engaged in the complete assembly of three-wheelers. The company developed its first three-wheelers Chief at Auto Expo 2008 in New Delhi (India). Rasandik operates an assembly plant in Greater Noida, Uttar Pradesh (India) for manufacturing three-wheelers. In financial year 2011, Rasandik divested its entire stake in its whollyowned subsidiary Rasandik Auto Components. The company had acquired a 100% stake in the auto component subsidiary in 2006. The divested subsidiary operates a manufacturing plant in Mysore, Karnataka (India). The divestment is expected to help the company focus on its core business. Joint-venture Rasandik has a technical collaboration with Yachio Industry Co (Japan) for fuel tank production Investments In 2006, Rasandik commissioned Indias first tailored blank welding system. The TB welder of type LPQ3000 produces laser welded tailored blanks.
Tel: + 91 11 2614 9276/ 77 Fax: + 91 11 2615 4090 Internet: http://www.rasandik.com

Senior Officers SC Kapoor, Chairman Rajiv Kapoor, Managing Director Mohan Sukhal, Vice-President, Commercial G Bhattacharya, Senior Manager, Sales Arati Raina, Senior Engineer, Exports in charge VK Saxena, General Manager, Operations Products Assemblies, body parts, dies, exhaust systems, fuel tanks, suspension parts, tooling, sub-assemblies- rear axle, locator shock absorber, wish bone, cross member Plants India (4): Haryana (2), Maharashtra, Uttar Pradesh Sales INR2.7bn (USD59m, 31 March 2011) (Year to 31.03.11) Employees 1,131 (31 March 2010)
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Divestments In March 2011, Rasandik divested its 100% stake in its wholly-owned subsidiary R asandik A uto Components. The divested subsidiary operates a manufacturing plant in Mysore, Karnataka (India). Contracts Rasandik supplies fuel tanks to Tata Nano. Rasandik supplies tailor welded blanks and fuel tanks for the Maruti Suzuki A-Star and Swift DZire. Rasandik supplies tailor welded blanks for the Maruti Suzuki Swift and SX4. In 2006, Rasandik was awarded the contract for supplies of fue l ta nk s f o r Ze n E st i llo. Certifications Rasandik has been accredited with ISO/TS 16949 and ISO 14001 status. Financial Overview In the financial year ended 31 March 2011, Rasandik generated net sales of INR2.7bn (USD59m, 31 March 2011), an increase of 16.3% over INR2.3bn (USD51.1m, 31 March 2010) in 2010. Despite significant increase in sales, the company witnessed a 35.8% decline in profit before tax (PBT) to INR43.6 (USD1m) compared with INR67.9m (USD1.5m) in 2010. Net profit for the year was INR20.5m (USD0.45m), a decline of 57.8% compared to INR48.6m (USD1.1m) in 2010. Rasandik is expecting a 10% increase in sales in the financial year ending 31 March 2011. The company has received orders from its customer in the component segment which is expected to drive its growth during the financial year. Year 2011 2010 2009 2008 2007 Net Sales (INRm) 2,677.8 2,302.0 1,976.7 1,803.9 1,583.4 Profit Before Tax (INRm) 43.6 67.9 27.0 124.3 61.1 Net Profit (INRm) 20.5 48.6 (7.3) 71.6 36.8
Year 2011 2010 2009 2008 2007
Net Sales (USDm) 59.0 51.1 37.89 45.21 36.45
Net Profit (USDm) 0.49 1.1 (1.4) 1.79 0.85
Outlook Rasandik enjoys a first mover advantage with TWB technology. Weight reduction programmes initiated by OEMs will help the company gain supply contracts to vehicle programmes, particularly with MarutiSuzuki where the technology is being widely adapted in the new programmes after it was initiated on the Swift, followed by A-Star and SX4. Rasandik is well poised to grow despite slower demand backed by better margins that the company can enjoy with its near monopoly with TWBs in India. By entering into complete vehicle manufacturing, Rasandik is targeting high growth potential three-wheelers market in India. The market has recorded strong growth in the past with sales increasing from 307,862 units in financial year 2005 to 526,022 units in 2010-11. In addition exports have surged during the period from 66,795 units to 269,967 units. The threewheeler market is expected to continue recording strong growth in coming years driven by its growing use as means of last mile transportation in rural and semi-urban areas in India. Although the company faces strong competition from established players like Bajaj Auto, TVS Motors and Mahindra& Mahindra, the high-growth potentials of the market is expected to provide space for all automakers in the segment.
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Remsons
Auto control cables and gear shifters
Address Remsons Industries Ltd, 88/B, Government Industrial Estate Kandivili (West) Mumbai - 400 067 Maharashtra India
Remsons Industries is one of the largest producers of automotive control cables in India. The company also makes gearshift mechanisms and parking brake assemblies for the automotive industry. The company supplies to two-wheelers, passenger cars and commercial vehicles.
Remsons was established in 1959 as a trading company. The company was a pioneer in introducing control cables in India in 1965. Almost three decades later, the company started supplying to GM. In addition to automotive, the company makes cables for general engineering applications. The company manufactures control cables for automotive and general engineering applications. Remsons currently operates more than 20 manufacturing facilities across Daman and Diu, Gujarat, Haryana, Maharashtra, Rajasthan and Uttarakhand. Remsons supplies its products to both automakers and tier one suppliers. The companys customers among automakers include Ashok Leyland, Bajaj Auto, Eicher, Fiat India, Force Motors, Hero MotoCorp, Hindustan Motors, Mahindra & Mahindra, Royal Enfield, Tata Motors, TVS Motors and Yamaha. The company also supplies to tier one suppliers including Behr India and Subros. In addition, Remsons exports its products to many countries in Europe, North America and Asia. Recent Developments Corporate strategy Remsons is investing in capacity expansion to meet increased demand from its customers. The company is investing in new facilities as well as ramping up capacities at its existing facilities. In financial year 2011, Remsons commenced operations at a new facility in Daman (India). The company also completed modernisation and expansion at its two existing plants, also in Daman. Remsons invested INR7.2bn (USD15.6m, 31 March 2011) in capacity expansion which was funded partly by a term loan of INR4bn (USD88.1m) and internal accruals of INR3.2bn (USD70.5m). Ramsons other area of focus is on advancement of technologies and strengthening of the manufacturing system and capability. The company is now investing in new technologies and research and development (R&D) facilities especially in the form of latest software oriented designs and in-house product development. In addition, the company is making capital investments in the latest machines with higher capacities to meet the growing demand. These initiatives are expected to help Remsons improve manufacturing efficiency. While the domestic market remains the most vital market, Remsons is focusing on increasing exports. In 2010, the company opened a marketing office in the US to target the North American market. The company has had a similar office in the UK for over ten years, which focuses on increasing exports to the European market. Besides the company is rationalising its production footprint where higher cost locations have been marked for producing higher value products. Investments In February 2011, Remsons commenced production at a new manufacturing facility in Daman (India). Earlier, the company invested in additional capacities through carrying out modification and renovation at its other plants in Daman. The company invested INR7.2bn (USD15.6m) in capacity expansion in financial year 2011. Divestments In 2011, Remson divested its stake in a joint-venture with the US-based Orscheln Products, through selling its stake to the foreign partner. Remson entered into 40:60 JV agreement with Orscheln Products in 2005 for manufacturing control cables at its Daman plant for supplies to
Tel: + 91 22 2868 3883/ 6143 2100 Fax: +91 22 2868 2487 Internet: http://www.remsons.com
Senior Officers V Harlalka, Chairman Krishna Kejriwal, Managing Director Amolak Jhawar, CEO (Mumbai Division) Sunil Mishra, Marketing Manager Sher Singh, Director Anil Kumar Agarwal, CFO Products Body cables, control cables, gear shift mechanism, push pull cables, park brake mechanism, speedometer cables Plants India: More than 20 plants in Daman and Diu, Gujarat, Haryana, Maharashtra, Rajasthan and Uttarakhand Sales INR947.2m (USD20.9m, 31 March 2011) (Year to 31.03.11) Employees 550 (31 March 2008)
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passenger cars in India and abroad. Contracts In 2010, Remsons commenced exports of floor mounted parking brake lever for Iveco. The company supplies to the Tata Indica Vista programme. In 2006, Remsons commenced supplies of parking brake safety cables under a two year contract to a major European commercial vehicle manufacturer. The company supplies all cable requirements for the GM Chevrolet Tavera programme. Remsons accounts for 70% of cable requirements of the Tata Indica programme. Remsons accounts for 85% of Hero Hondas requirement of control cables. New Product Developments Remsons is accredited with developing friction free cables using polysil, which is an indigenously developed substitute. Friction free cables help retard the engine earlier hence cutting fuel consumption. Now it is mandatory for all automobile manufacturers in the country to use friction free cables. Certifications Remsons has been accredited with ISO 9001 & ISO 9002 and QS 9000 status. Financial Overview In the financial year ended 31 March 2011 Remsons recorded net sales of INR947.2m (USD20.9m, 31 March 2011) compared with INR690.3m (USD15.3m, 31 March 2010), registering a year-over-year growth of 37.2%. Higher sales led the company to report a 14.3% increase in profit before tax (PBT) of INR40.9m (USD0.9m) compared to INR35.7m (USD0.8m) in the previous financial year. The company more than doubled its net profit to INR34.m (USD0.75m) over INR16.7m (USD0.37m) in the financial year 2010. Remson is expecting to record a 25% increase in sales in the financial year ending 31 March 2012. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 947.2 690.3 558.1 551.4 526.8 Net Sales (USDm) 20.9 15.3 10.7 13.8 12.1 Profit before tax (INRm) 40.9 35.7 27.6 (12.7) (57.8) Profit before tax (USDm) 0.9 0.8 0.5 (0.3) (1.3) Net Profit (INRm) 34 16.7 11.3 (11.6) (41.1) Net Profit (USDm) 0.7 0.4 0.2 (0.3) (0.9)
Outlook Remsons has recorded a significant turnaround in its financial performance after going through a lean phase during financial years 2007 and 2008. The company has benefited from the strong growth of the Indian automotive industry in the past three years. In addition, continuing focus on streamlining costs has helped Remsons improve its profitability. The company has invested in additional capacities, through setting up both new facilities and modernising and upgrading existing facilities to meet higher demand. In addition, the company has invested in new technologies, R&D capabilities and latest manufacturing processes. This positions Remsons well to benefit from expected growth of vehicle production in India in coming years.
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Rico Auto
Ferrous and aluminium components
Address Rico Auto Industries Ltd 38 KM Stone Delhi-Jaipur Highway Gurgaon 122001 Haryana India Tel: +91 124 2824 000 Fax: +91 124 2824 200 Internet: http://www.ricoauto.com Senior Officers Chandra Mohan, Chairman Arvind Kapur, Vice Chairman, CEO and Managing Director Arun Kapur, Joint Managing Director OP Agarwal, Executive Director, Finance Anup Singh, Director Satish Sekhri, Director Products Balance shaft assembly, brake drums, brake panel assembly, cam covers, clutch assembly, crank cases & cover, cylinder head cover, differential case, discs & rotors, distributor case, engine brackets, engine front cover, exhaust gas recirculation (EGR) plate, exhaust system parts, exhaust manifold, flywheel assembly, front & rear cover, front end auxiliary drive brackets, fuel system parts, gear housing, gear shift forks, intake manifold cover, lube oil filter head, main bearing caps, oil pan, oil pump assembly, rocker arm, steering knuckles, thermostat housing, transmission support assembly, turbo charger parts, valve cover, water & air connections and wheel hub assembly Plants India (14): Gujarat, Haryana (8), Maharashtra, Punjab, Rajasthan, Tamil Nadu, Uttrakhand Sales INR10.1bn (USD224.2m, 31 March 2010) (Year to 31.03.10) Employees
Rico Auto is an integrated manufacturer of ferrous and aluminum components and assemblies to the automotive industry. The company supplies chassis, engine and transmission components to twowheelers, passenger cars, commercial vehicles and system suppliers.
Rico Auto was incorporated in 1984-85. The company commenced operations through setting up an aluminum die casting and machining plant in Dharuhera, near Gurgaon, Haryana (India) in 1986. The company has technical alliance with Japan-based FCC to produce clutch assembly. Later, the two partners formed a joint-venture to produce clutch assembly primarily for two-wheelers. In the past few years, Rico has entered into JV partnerships with some leading tier one suppliers, including Continental and Magna International. The company, along with its subsidiaries, operates 14 manufacturing plants in India, of which eights are located in Haryana and one each in Maharashtra, Punjab, Rajasthan, Tamil Nadu and Uttrakhand. In addition, Rico Auto is considering setting up its second plant in Bhiwadi, Rajasthan to produce casting and machining. Outside India, the company operates logistics, warehousing and assembly operations in Michigan (USA) and London (UK). As on 31 March 2011, the company had 4,960 employees. Rico Auto supplies to two-wheelers, passenger cars and commercial vehicles. The companys major customers include BMW, Bajaj Auto, Caterpillar, Cummins, Fiat, GM, Hero MotoCorp, Honda Seil Cars, Honda Motorcycle & Scooter India, Jaguar Land Rover Maruti Suzuki, Tata Motor and Volvo. In addition, the company supplies to major system suppliers. Among leading tier one suppliers, Rico Auto supplies to Magna, Mann+Hummel, Continental, Jatco and Matsusaka Engineering. Recent Developments Corporate strategy Rico Auto is focusing on expanding capacities to meet expected surge in demand for its components in India and international markets. In October 2010, the company announced to set up three greenfield plants, one each in Bawal, Haryana; Sanand, Gujarat and Chennai, Tamil Nadu with an investment of INR850m (USD19.2m, 19 October 2010) over a period of two years. The company commenced production at its Bawal and Sanand plants in the financial year 2011 while the Chennai plant will become operational by 2012. Meanwhile the company continues to explore new growth opportunities through adding high value products to its portfolio. In the past five years, Rico Auto entered into strategic partnership with Continental, Magna and Zhejiang Jinfei Wheels which allowed the company to significantly expand its product offering to the automotive industry. All three JVs have secured contracts from OEMs operating in India. This is likely to strengthen Rico Auto presence in the country as a diversified auto components supplier and improve its financial performance. Joint-ventures In October 2007, Rico formed a 50:50 joint-venture with Magna Powertrain, to manufacture oil and water pumps for the Indian and European markets. The JV, Magna Rico Powertrain Private Limited, started commercial production of two water pumps programs for Suzuki Powertrain India Private Limited (SPIL) and Renault-Nissan India. The JV has established a manufacturing plant in Manesar, near Gurgaon in Haryana (India) which also has a testing facility. The JV has also won supply contracts from Volvo Trucks Sweden for its global platform. In June 2007, Rico entered into a 50:50 JV with Continental to manufacture hydraulic brake systems in India. The JV, Continental Rico operates a manufacturing plant in Gurgaon, Haryana (Inida). The JV started supplying to Fiat and Maruti Suzuki in the financial year 2011. It will start supplying to Ford and Volkswagen India and South Africa in financial year 2012. In May 2007, Rico Auto entered into a JV agreement with Zhejiang Jinfei Wheels Ltd to manufacture aluminium alloy wheels for two-wheelers. Rico has
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4,960 (31 March 2011)
a 92.5% stake in the JV while the remaining 7.5% is owned by the Chinese partner. Rico Jenfei secured a contract by Honda Motorcycle & Scooter India to supply alloy wheels. Investments In October 2010, Rico Auto announced plans to establish three plants in India to cater to increasing demand from automakers. The company planned to invest INR850m (USD19.2m, 19 October 2010) in the next two years. Rico will operate two facilities, one at Bawal, Haryana and the second at Sanand, Gujarat. The company started operations at Bawal and Sanad plants in fiscal year 2011. With an investment of INR400m (USD9m), the Gujarat facility supplies components to Tata Motors for the Nano model. The company is setting up its third manufacturing plant at SIPCOT Industrial Park at Oragadam, near Chennai, Tamil Nadu with an investment of INR200m (USD4.5m). This facility is expected to be operational in the fiscal year 2012. In March 2010, Rico Auto commissioned a new manufacturing plant in Haridwar, Uttarakhand (India). The new plant has been established to supply Hero MotoCorps assembly plant in Haridwar. Rico Auto has been granted 100% exemption from central excise tax for the first ten years of operations, and 100% exemptiom from income tax for first five years and 30% in the subsequent five years. Divestments In December 2011, Rico Auto divested its entire stake in joint-venture KRP Auto to its partner Kailash Royal Premium Projects. The company sold 475,000 fully paid-up equity shares of INR100 (USD1.8) each for a total consideration of INR203m (USD3.2m). Following the transaction, KRP Auto ceased to be a subsidiary of Rico Auto. Rico Auto entered into a JV agreement with Kailash Royal Premium Projects in December 2009 to produce auto parts in Bangalore, Karnataka (India). The JV, 95% owned by Rico, established a manufacturing plant in Bangalore, Karnataka (India). Certification Rico Autos facilities have been accredited with ISO-TS16949, ISO14001, OHSAS18001 certifications.
Contracts In 2011-12, Rico FCC, a subsidiary of Rico Auto commenced supplying clutches for Hondas Brio compact car. In 2010-11, Magna Rico Powertrain, a subsidiary of Rico Auto commenced supplying water pumps to Suzuki Powertrain India Private Limited and Renault Nissan India. In 2010-11, Continental Rico Hydraulic Brake India, a subsidiary of Rico started supplying Fiat and Maruti Suzuki. The company will commence supplying to Ford and Volkswagen India and South Africa in the financial year 2012. In September 2011, Rico secured an export order worth INR700m (USD15.1m, 7 September 2011) to supply transmissions to a global passenger car maker. The company expects to begin supply of both manual and automatic transmissions from June 2012. In 2009, Rico Auto signed a technical assistance agreement with Honsel AG to develop and manufacture aluminium cylinder blocks for diesel engine solely related to the two-cylinder blocks for Tata Nano. In 2006, Rico Auto signed a licensing and technological agreement with Teksid Aluminium to develop aluminium engine blocks and heads produced along with high and low pressure die cast, gravity and lost foam process. Financial Overview In the financial year ended 31 March 2011 Rico Auto reported a 31.5% increase in consolidated net sales to INR13.1bn (USD288.1m, 31 March 2011) compared with INR9.9bn (USD220.9m, 31 March 2010) in the previous financial year. Higher sales led the company to record a significant increase in profit before tax to INR243.5m (USD5.4m) compared with INR12.9m (USD286,475) in the previous financial year. Rico Auto concluded the financial year with net profit of INR133m (USD2.9m) against net loss of INR49.1m (USD1.1m) in 2010. Rico Autos stand-alone net sales crossed the INR10bn (USD220.3m) mark for the first time in its corporate history. The company reported 29.6% increase in net sales to INR10.2bn (USD224.7m). Rico Autos domestic sales increased by 26% to
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INR7.7bn (USD169.6m) while exports surged 37% to INR2bn (USD44.1m). Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 13,079.7 9,945.5 9,043.9 8,393.1 8,782.2 Net Sales (USDm) 288.1 220.9 173.3 210.3 202.2 Profit Before Tax (INRm) 243.5 12.9 (27.0) 390.0 584.0 Profit Before Tax (USDm) 5.4 0.3 0.5 9.8 13.4 Net Profit (INRm) 133.0 (49.1) (54.0) 234.0 378.0 Net Profit (USDm) 2.9 (1.1) (1.0) 5.9 8.7
Outlook Rico Auto counts on Maruti Suzuki and Hero Honda, the two leading players in the two- and four-wheeler segment in India, as major customers. These two companies have been major volume drivers in their respective segments, thus helping the company to consistently report strong growth. The company expects this trend to continue in coming years as well Rico Autos revenues in the past few years have remained under pressure, though the company recorded a strong comeback in 2010-11, driven by significant top line growth. The company, as with several other suppliers, faces tremendous pressure due to sharp upward movement in prices of raw materials and increase in other costs like power and wages. Given these cost-related challenges, Rico Auto will focus on improving productivity and operational efficiency to reduce costs in coming years.
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Ring Plus Aqua

Flexplate assembly, starter gear ring, shaft bearings
Address Ring Plus Aqua Limited 1st Floor, J. K. Files (I) Ltd. Annex Building Jekegram Pokhran Road No.1 Thane 400606 Maharashtra India Tel: +91 22 6152 7000 Fax: +91 22 6152 7670 Website: http://www.ringplusaqua.com/ Senior Officers Gautam Hari Singhania, Chairman and Managing Director, Raymond Group Harshal Jayvant, President Engineering Division Products RPA: Flexplate assemblies, flywheel starter ring gears, integral shaft water pump bearings, precision sheet metal components Trinity: Camshafts, engine components, differential parts, front wheel hubs, powertrain parts, propeller shaft components, rear wheel spindles, stub axles, steering levers Plants India (5): Maharashtra (5) Sales INR1.1bn (USD25.5m, 31 March 2011) (Year to 31.03.11) Employees c1,000 (2011)
Ring Plus Aqua is an auto component supplier owned by the Indian textile major Raymond. The company supplies starter gear rings, integral shaft bearings and flex plate assembly for the automotive industry.
Ring Plus Aqua was established in 1997 through a merger of two companies Ring Gears India Limited and Aqua Bearings Limited. Eight years later in 2005, Indias major textile company, the Raymond Group acquired 69.17% in Ring Plus Aqua, and forayed into the auto component business. Ring Plus Aqua operates its business in three divisions: Starter Gear Ring, Shaft Bearings and Flexplate Assembly. The company operates one manufacturing plant in Sinnar, near Nashik, Maharashtra (India). In February 2012 Ring Plus Aqua acquired the controlling stake in Trinity India. The acquisition brought in four additional plants which the acquired company operates in and around Pune, also in Maharashtra (India). Ring Plus Aqua supplies its components to Avtek, Caterpillar, Escorts, Force, Ford India, Honda, Hyundai, John Deere, Mahindra & Mahindra, Simpson, Tata Cummins and Tata Motors. The company has a warehouse in the US to meet just-in-time (JIT) requirements of its customers in North America. Trinity India has a wider customer base supplying to Ashok Leyland, Eicher, Force, Ford India, Hindustan Motors, Maruti Suzuki and Tata Motors. The company also supplies to tier one suppliers including Bosch, Eaton and Dana. In addition, the company supplies Ford globally, Dana in Spain, Eaton in Poland and McHale Engineering in Ireland and Hungary. Recent Developments Corporate strategy Since July 2011, Ring Plus Aqua has been scouting for acquisitions to enter into the forging business to supply forged and machined components to OEMs. The company has earmarked INR2bn (USD44.6m) for the planned entry into the forging segment. In February 2012, the company announced an acquisition of controlling stake of 78% in Trinity India a major supplier of hubs, spindles, connecting rods and similar components and counts. The acquired company operates four manufacturing facilities in and around Pune, Maharashtra (India) with an annual installed forging capacity of 12,500 tonnes. The INR540m (USD10.9m) acquisition not only helped the company to enter the forging segment, expanding its product portfolio but also added four manufacturing facilities. The takeover also significantly broadened customer base of Ring Plus Aqua as the acquired company has customers in India and abroad. Meanwhile the company is also ramping up capacities at its existing plant in Nashik, Maharashtra (India). In July 2011, Ring Plus Aqua announced an investment of INR200m (USD4.45m) to increase ring gears manufacturing capacity by 50% to 4.5 million units. The expansion completed in September 2011. Acquisition In February 2012, Ring Plus Aqua acquired a majority stake of 78% in Trinity India for INR540m (USD10.9m, 24 February 2012). The acquired company operates manufactures hubs, spindles, connecting rods and similar components. The company operates four manufacturing plants in Pune region, Maharashtra (India). The acquisition enabled Ring Plus Aquas entry into forging industry. Joint-Venture In 2006, Ring Plus Aqua entered into a joint-venture (JV) agreement with US-based A J Rose Manufacturing Company. The JV manufactures precision sheet metal pulleys by spinning process.
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Investment In July 2011, Ring Plus Aqua announced it would invest INR200m (USD4.4m, 31 July 2011) in increasing ring gear manufacturing capacity from three million units to 4.5 million unit at its Nashik plant. The increased capacity is expected to help the company meet growing order from its customers. Contracts Ring Plus Aqua supplies starter rings to Honda. Ring Plus Aqua supplies starter ring gears to Hyundai i10 and i20. Ring Plus Aqua supplies starter ring gears to Forf Figo Certification Ring Plus Aqua manufacturing plant in Nashik, Maharashtra (India) is accredited with ISO/TS16949: 2002 certification. Trinity Indias manufacturing plants are accredited with ISO/TS16949 certifications. Financial Overview In financial year ended 31 March 2011 Ring Plus Aqua reported a 42.6% increase in sales to INR1.1bn (USD24.7m, 31 March 2011) compared with INR789m (USD17.5m, 31 March 2010) in the previous financial year. Higher sales led the company to more than double its profit before tax (PBT) to INR164.6m (USD3.6m), over INR78.2m (USD78.2m) in 2010. The company concluded the year with net profit of INR112.9m (USD2.5m) compared with INR50.8m (USD1.1m) in the previous financial year. Segment wise, the Starter Gear division recorded a 58% increase in sales to INR732.1m (USD16.1m) compared with INR463m (USD10.3m) in the previous financial year. The company reported a 22% increase in domestic demand while its exports doubled. The Bearing Division recorded 3% increase in sales to INR265.4m (USD5.8m) compared with INR257.3m (USD5.7m) in the previous year. The Flexplate Assembly Division reported sales of INR27.9m (USD619,590) more than double from INR13.2m (USD293,140) in the previous financial year. Outlook The Raymond Group entered auto component business through acquisition of Ring Plus Aqua in 2005. However, the group has kept more or less a low profile in its first venture outside the textile sector. However the parent company looks to play a big role in the auto component business. In 2011 the company earmarked INR2bn (USD44.6m) to enter the forging segment, mainly through acquisitions. The company intends to manufacture components ranging from connecting rods to axles for OEMs. Overall the company is targeting sales of INR12bn (USD264.3m) over the next five years, a tenfold growth compared with INR1.1bn (USD24.7m) in financial year 2011. This may appear a tall order but company can achieve this through acquisitions. Ring Plus Aqua has already made a start with taking over the controlling stake in Trinity India. Of the two key businesses of starter rings and flexplates, Ring Plus Aqua expects the latter to record strong growth. Flex plate is mainly used in automatic transmission vehicles; therefore the component has great growth potentials especially from the overseas customers. The company is currently pitching for new contracts from German commercial vehicle manufacturers entering the Indian market such as MAN. Acquisition of a majority stake in Trinity India marks Ring Aquas entry into the high growth potential forging industry. According to media reports, the Indian forging industry is valued at around USD3bn while the global forging industry is of USD110bn, implying significant export growth opportunities for the domestic suppliers operating in this segment.
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RSB Transmissions
Axles, propeller shafts, transmission components
Address RSB Transmissions (India) Ltd. Pune Trade Centre Ubale Nagar, Nagar Road Wagholi Pune-412207 Maharashtra India Tel: +91 33 3984 0999 Fax: +91 33,3984 0998 Internet: http://www.rsbglobal.com Senior Officers RK Behra, Chairman SK Behra, Vice-Chairman, Managing Director Shailendra K Behra, Joint Managing Director M Sankarnarayan, President, Auto Component & Systems Rajanikant Behra, Vice-President, Corporate Strategy and Finance Sanjay Chadda, Executive-Vice President, International Business G Krishnasami, Vice-President, Group Quality. Mathura Singh, Senior Vice-President Finance Bijay Lenka, Associate Vice-President, Group Corporate Finance Products Aluminium castings, axles, ferrous castings, propeller shafts, transmission components Plants India 10 plants in Jharkhand, Karnataka, Maharashtra, Odisha, Tamil Nadu, Uttar Pradesh and Uttarakhand Outside India: Belgium, Mexico, US Sales INR10.4bn (USD231m, 31 March 2011) (Year to 31.03.11) Employees 1,000 (March 2011)
RSB Transmission is a major supplier of aluminium- and ferrous castings components. The company manufactures axles, propeller shafts and transmission components for the automotive industry. In addition to automotive, the company also supplies to the construction equipment industry.
RSB Transmission commenced its operations in 1975. The company manufactures aluminium and ferrous castings components primarily for the automotive industry. In addition to automotive, the company supplies to construction equipment industry. The company operates 10 manufacturing facilities in India and one each in Belgium, Mexico and the US. The companys facility in India is located in the states of Jharkhand, Karnataka, Maharashtra, Odisha, Tamil Nadu and Uttarakhand. RSBs overseas plants are located in Sialo, Guanajuato (Mexico) and Michigan, (US). The company also operates one plant in Tessenderlo (Belgium) which caters to construction equipment industries. The company supplies its products to both automakers and tier one suppliers. RSB major customers among automakers include Ashok Leyland, Caterpillar, Eicher, JCB, John Deere, Mahindra & Mahindra, Tata Motors and Volvo. The companys customers among tier one suppliers include Allison Transmission, American Axle & Manufacturing, Cummins, Eaton and Lombardini. In addition to the domestic market the company exports its products to major global automotive markets including Europe and the US. RSB Transmission generates 85% of its sales from the domestic market, where exports account for the remaining 15%. Recent Developments Corporate Strategy: RSB Transmission is investing in new plants to meet increasing demand from its customers. In 2010, the company announced that it was investing INR3.5bn (USD74.2m) over a period of four years (2014) in establishing an integrated forging and casting plant in Cuttack, Odisha (India). The plant will have a three-line forging unit and a casting unit. In addition, RSB Transmission is setting up a manufacturing plant in Lucknow, Uttar Pradesh to supply Tata Motors which also operates an assembly plant in the same region. While the domestic market remains the major source of sales, RSB Transmission is focusing on increasing exports. In May 2011, the company invested in a new manufacturing plant in Silao (Mexico) to manufacture transmission components like differential cases, yokes, carriers and finished gears. The new plant is strategically located to cater to its customers in the US and other major markets in the region. The company is considering using the Mexican plant to export components in South America. The company is working to expand its product portfolio. The company is developing a propeller shaft which uses fewer components than the conventional propeller shafts. In addition, RSB Transmission is developing a propeller shaft using lightweight materials. Investments In May 2011, RSB Transmission announced plans to set up a new manufacturing plant in Silao, Guanajuato (Mexico) to manufacture transmission components such as differential cases, yokes, carriers and finished gears. The company will invest USD50m to USD60m in a period of three years. The company will leverage the strategic location of Mexico to serve its customers in North and South Americas. The new
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plant will allow RSB to serve American Axle, Eaton, Magna, Getrag, GM and Chrysler who are already its customers in the US. It could also export to automotive companies in Brazil and Argentina. In 2011, RSB Transmission set up a new manufacturing plant in Lucknow, Uttar Pradesh (India) to manufacture propeller shafts for Tata Motors. The plant has capacity to produce 550 propeller shafts a day. The plant became operational in 2011. In May 2010, RSB Transmission announced it was investing INR3.5bn in an integrated plant in Cuttack, Bhubaneswar, Odishia (India). The plant will have a three-line forging unit and a casting unit. The plant will become operational in financial year 2012.
Contracts RSB Transmission supplies transmission gears to Fiat and Tata Motors. RSB Transmission has been selected by Tata Motors to supply rear banjo axle beam for some of the new Ultra range of LCVs that were unveiled at the 2012 Auto Expo in New Delhi. RSB Transmission will also supply rear banjo axle beam to Eicher LCV from VE Commercial Vehicles. New Product Development RSB Transmission operates a research and development (R&D) centre in Pune, Maharashtra (India). The company has developed a propeller shaft of a unitised construction. As a result the new propeller shaft has fewer components than the conventional propeller shafts. RSB Transmission is working on a propeller shaft which uses lightweight material. Financial Overview In the financial year ended 31 March 2011 RSB Transmission generated sales of INR10.4bn (USD231m, 31 March 2011). The company hopes to generate sales of INR14bn (USD308.4m) in financial year 2012. RSB Transmission is a privately owned company and therefore does not publish details of financial results. Outlook RSB Transmission has set a goal to grow at compound annual growth rate (CAGR) of 30% to 35% over the next four years. In order to complement its organic growth, the company is looking for few joint-venture partnerships and acquisitions. The JVs and acquisitions are also expected to give RSB Transmission access to advanced technologies. Although RSB Transmission has been mainly a supplier of transmission gears to commercial vehicles, the company has managed to secure several contracts to supply the component to OEMs such as Fiat and Tata. Most of the passenger OEMs manufacture transmissions in-house. The company is also negotiating with two more automakers to supply transmission gears. RSB Transmission is focusing on growing its exports business, and its new plant in low cost region of Mexico is expected to help the company export products effectively to key markets in North and South America. RSB Transmission imports of raw materials have increased recently due to the sharp depreciation in the Indian rupee against the US dollar. Higher revenue from exports is expected to help the company to counter the impact of higher spending on imports.
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Ruia Group
Automotive fasteners, sealants, tyres and rubber
Address Ruia Group Ruia Centre 46 Syed Amir Ali Avenue Kolkatta-700017 West Bengal India Tel: +91 33 2289 4747 Fax: 91 33 2289 3463 Website: http://www.ruiagroup.co.in Senior Officers Pawan Kumar Ruia, Chairman Shiv Narayan Maheshwari, Executive Director and CEO, Dunlop India Virendra Agrawal, Director Manish Singhania, CFO, Dunlop India Products Tyres, fasteners, sealants Plants India (8): Himachal Pradesh, Karnataka, Maharashtra, West Bengal, Tamil Nadu, Uttarakhand Outside India: France, Germany (6), Morocco, Romania, Tunisia, UK Sales Ruia Group: INR75bn (USD1.7bn, 31 March 2011) Dunlop India: INR1.6bn (USD36.5m) Employees 16,000 (2011)
The Ruia Group is a diverse industrial conglomerate with interest in tyre and rubber, automotive sealants, fasteners and heavy engineering and infrastructure. In addition, the group has interests in health resorts.
The USD1.5bn-Ruia Group organises its diverse business into four verticals: Tyre and Rubber: the Ruia Group is a major supplier of pneumatic tyres for two-wheelers, three-wheelers, commercial vehicles and off-the-road (OTR) vehicles. The group owns major tyre brands such as Dunlop and Falcon Tyres. Other brands of the group include Dunlop Polymer, Montana Tyres and India Tyre & Rubber. In addition, the Tyre and Rubber vertical manages Gumasol, a specialist in elastomer technology and products. Automotive Sealants: operates two overseas subsidiaries Draftex Automotive (Germany) and Schlegel Automotive (UK). Draftex supplies a full range of products in car body seals and counts BMW, Daimler and Volkswagen as its major customers. The companys plant is located in Grefarth, near Dsseldorf (Germany). Schlegel Automotive operates a manufacturing plant in Leicestershire (UK) engaged in the supply of a full range of sealing components for the automotive industry. Automotive Fasteners: the Ruia Group acquired Germany-based Acument GmbH in February 2011. The group renamed the acquired company as Ruia Global Fasteners, which is one of the providers of complete fastening supply chain and logistic programmes for vehicle and component assembly facilities. The company operates four plants in Germany and employs 1,300 people. These facilities together process 55,000 tonnes of metal a year producing more than 3.2 billion parts for the auto industry and supplying to all major OEMs including BMW, Daimler, Ford, GM, MAN and Volkswagen. Heavy Engineering and Infrastructures: operates Jessop & Company one of the oldest engineering company in India. The company supplies to railways coaches and wagons, cranes, road rollers and hydraulic equipment. In addition, the Ruia Group has presence in health resorts through the P.D. Ruia Kayakalp Naturopathy & Health Resort. The Ruia Group operates manufacturing plants in Kolkata and Sahaganj in West Bengal; Ambattur in Tamil Nadu, Mysore in Karnataka, Nasik and Wada in Maharashtra, Haridwar, Uttarakhand and Una in Himachal Pradesh (all in India). As of March 2011, the group had 16,000 employees. In addition, the group has manufacturing presence in France, Germany, Morocco, Romania, Tunisia and the UK. The group has a diverse customer base which includes manufacturers of twowheelers, three-wheelers, passenger cars and commercial vehicles. The Ruia Groups major customers include BMW, Bajaj Auto, Fiat, Ford, GM, Hero MotoCorp, Honda, Mahindra & Mahindra, Renault-Nissan, Saab, Toyota, Volkswagen, Volvo and Yamaha India. In addition to automotive, he Group caters to the non-automotive industry and supplies to Indian Railways, SAIL, Kolkata Port Trusts and defence organisations. Recent Developments Corporate strategy Ruia Group has been expanding its presence in India and international markets through several strategic acquisitions. The group, which entered the automotive business primarily through acquiring the tyre business of Manu Chabaria family-owned Jumbo Group in 2005, has announced a series of acquisitions, involving several ailing suppliers in India and Europe in the past seven years. These acquisitions have not only allowed the Ruia Group to diversify its business in other areas such as automotive sailings and fasteners, but also strengthened its manufacturing presence, in India and Europe, and broadened its customer base.
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While the Ruia Group has been successful in turning around most of the ailing companies it acquired, the group has been facing problems at Dunlop India. The flagship tyre company of the Ruia Group has been facing labour strikes at its Sahganj plant in West Bengal since the second half of 2011 and more recently at its Ambattur plant in Tamil Nadu. The company announced work suspension at Sahganj plant in October 2011 alleging law and order problems at the plant and non-corporation from workers. Meanwhile, in February 20012, Dunlop India suspended operations at its Ambattur plant owing to labour unrest. The company is devising a restructuring plan for the plant which is expected to result in job losses. Dunlop India will restructure the facility under associate company Falcon Tyres once the disputes with the worker unions have been settled. Acquisitions In May 2011, Ruia Group acquired France-based automotive sealing supplier Sealynx Automotive for an undisclosed sum. Following the completion of takeover, the Ruia Group has renamed the company Ruia Sealynx SAS. The acquired company operates manufacturing plants in France, Romania, Morocco and Tunisia. Sealynx reported sales of EUR68m (USD90.1m, 31 December 2010) in 2010 and had 981 employees. The acquired company supplies to French automakers PSA Peugeot Citron and Renault and Romanian automaker Dacia. In May 2011, Ruia Group announced acquisitions of Germany-based Meteor Gummiwerke and Turkey-based Standard Profil AS. The acquisitions will make the Indian owner one of Europes leading manufacturers of rubber sealing systems for cars. However, the group later abandoned the idea of acquiring Turkey-based sealing supplier due to some undisclosed problems. The acquisition of Meteor was completed in 2011. In February 2011, Ruia Group acquired Germany-based Acument GmbH, one of the leading suppliers of automotive fasteners. The acquired company produces a wide range of high precision fasteners like long shafted bolts, hexagonal screws, nuts and forged parts. Acument operates four manufacturing plants, located in Neuss, Beckingen, Neuwied and Schorzberg, and one logistic centre in Cologne (all in Germany). The acquired company reported sales of EUR800m (USD1.1bn, 31 December 2008) in 2008 before it filed for insolvency in 2009. In August 2010, Ruia Group acquired Gumasol-Werke Dr. Mayer GmbH & Co. KG, a specialist in elastomer technology and products. The acquisition included a manufacturing/developing facility near Frankfurt (Germany) with around 100 employees. The acquired company reported sales of EUR35m (USD49.3m, 31 December 2008) in 2008. In December 2009, Ruia Group acquired 59.9% of Henniges Automotives manufacturing and R&D facility in Grefrath (Germany) from the Dsseldorf-based administrator through an asset deal. Post acquisition, the Indian owner renamed the company Draftex Automotive GmbH. The acquired company supplies complete car body sealing solutions and counts German automakers such as Audi, BMW, Daimler and Volkswagen as its major customers. In July 2008, Ruia Group acquired Metzeler Automotive Profile System UK Limited, a supplier of synthetic rubber-based sealing components for the automotive Industry, from CVC Capital Partners for an undisclosed firm. Post acquisition, the Indian owner changed the name of the acquired company to Schlegel Automotive. The acquired company operates a manufacturing plant in Leicestershire (UK) and reported a turnover of GBP28m (USD55.9m, 31 December 2007) in 2007. Financial Overview The Ruia Groups turnover is estimated to be around INR75bn (USD1.7bn). The group is privately owned and therefore does not publish details of financial results. Dunlop India, the publicly listed company of the Ruia Group, reported a 5.7% decline in net sales to INR1.7bn (USD36.5m, 31 March 2011) in the financial year ended 31 March 2011, compared with INR1.8bn (USD39m, 31 March 2010) in the preceding year. The company reported profit before tax (PBT) as well as net profit of INR20.2m (USD444,960) over INR12.8m (USD284,250) in the previous financial year. Outlook Within a relatively short space of time the Ruia Group has emerged as a major supplier of tyres in India, and automotive sealing and fasteners
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products in Europe, thanks to several acquisitions by the company in the past few years. In particular, the group has emerged as one of the major suppliers of automotive sealing systems in Europe having acquired several companies in France, Germany and the UK. Today, the group boasts manufacturing presence in France, Germany, Romania, Morocco, Tunisia and the UK and counts most of the European automakers as its customers. In India, the Ruia Group has mainly focused on acquisition of tyre companies. Some of its acquisitions include Dunlop India, Falcon Tyre, Montana Tyre and India Tyre and Rubber. These acquisitions have enabled the Ruia Group to emerge as a major supplier of tyres for two-wheelers, three-wheelers, buses, trucks and off-the-road (OTR) vehicles. The company has been doing well at most of the acquired businesses in the domestic market, except at Dunlop India which has faced labour problems. The problem compelled the company to suspend operations at its Sahganj plant in October 2011 and at Ambattur plant in February 2012. The company claims to be trying its best to revive operations at its tyre plants but the non-cooperating attitude of worker union is nullifying all its efforts. The deadlock continues at the companys Sahganj plant as the companys plan of phase-wise withdrawal of production suspension has not impressed the workers. The union and state government have been demanding an unconditional withdrawal of production suspension. Meanwhile, Dunlop India is chalking out a restructuring strategy for Ambattur plant. The plan includes several initiatives including replacing existing workforce with a new and smaller group, managed by the management team of group company, Falcon Tyres.
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Saint-Gobain
Automotive Safety Glass
Address Saint-Gobain Sekurit India T-94-95 Bhosari Industrial Estate Bhosari Pune 411 026 Maharashtra India Tel: +91 20 2712 0047 Fax: +91 20 712 07770 Internet: http://www.saint-gobain.co.in Senior Officers Anand Y Mahajan, Chairman M G Ramakrishna, Director Padmanabha Shetty, Director Products Laminated and toughened automotive safety glass Plants India (4): Maharashtra (2), Rajasthan, Tamil Nadu Sales Saint-Gobain India: INR26.3bn (USD577.4m, 31 December 2010) (Year to 31.12.10) Saint-Gobain Sekurit India: INR939.4m (USD20.7m, 31 March 2011) (Year to 31.03.11) Employees c. 179 (31 March 2011)
Saint-Gobain is a major supplier of float glass, performance materials and construction products in India. The company is also the second largest supplier of automotive glazing in the country.
Saint-Gobain entered India in 1996, when it acquired a majority stake in Grindwell Norton Ltd. The company operates in three business sectors in India: Flat Glass, High-Performance Materials and Construction Products. All three sectors operate eight companies in India. The companys Flat Glass business sectors operate following two subsidiaries in India. Saint-Gobain Glass India Ltd: started operation in India in 2000 with commissioning of its first plant in Sriperumbudur, near Chennai in Tamil Nadu. The plant mainly produces float glass for mirroring and architectural segments. It also produces automotive glazing for its customers in India. SaintGobain Glass India is wholly-owned subsidiary of Saint-Gobain (France). Saint-Gobain Sekurit India Ltd: mainly supplies automotive glazing from its two plants in Bhosari and Chakan in Pune, Maharashtra (Maharashtra). The company produces laminated glass at Chakan while the tempered glass is produced at the Bhosari plant.
Saint-Gobain Sekurit India was originally promoted by Atul Glass Group to supply to Tata Motors, Premier Automobiles, Hindustan Motors and Force Motors. In 1993, the company entered into a joint-venture with Saint-Gobain Vitrage SA, France. A greenfield facility was added at Pune in 1994. The company was later brought under Saint Gobain. Saint-Gobain Sekurit caters to both original equipment (OE) and aftermarket. The companys customers in India include Ashok Leyland, Bajaj Auto, Eicher Motors, Fiat India, Force Motors, Ford India, Piaggio, Reva Electric Cars, Tata Motors and Toyota Kirloskar Motors. Recent Developments Corporate strategy Saint-Gobain is ramping up its capacity in India to meet strong demand from its automotive and construction sectors. In August 2010, the company commenced construction work on an integrated glass plant in Bhiwari, Rajasthan which will have an annual capacity to produce 300,000 tonnes of float glass for its customers in the automotive and construction industry. The company is investing INR15bn (USD320m) at the proposed plant in two phases. In the first phase SaintGobain will invest INR9bn (USD192m) to create new production lines. The first phase is scheduled to be completed by the first quarter of 2012. In the second phase the company will invest INR6bn (USD128bn). The company will take up the second phase based on capacity utilisation in the first phase. In May 2011, Saint-Gobain Sekurit Indias promoters Saint-Gobain Glass India and Saint-Gobain Sekurit SA (France) announced plans to delist company from the Bombay Stock Exchange. The company has already received approval from its Board of Directors for delisting. The promoters who own more than 85% stake in the local automotive glass unit, agreed to buy-back the companys publicly held shares, constituting 14.23% of the outstanding equity capital. The complete ownership is expected to offer the company operating flexibility in India. Investments In August 2010, Saint-Gobain India announced an investment of INR15bn (USD320m, 31 August 2010) to set up a plant for float glass in the Karahani industrial area of Bhiwadi, Rajasthan (India). The facility will have capacity to manufacture over 300,000 tonnes of float glass per annum for both automotive and construction industry. The company is investing INR15bn (USD320m) at the proposed plant in two phases. In the first phase Saint-Gobain will invest INR9bn (USD192m) to create new production lines. The first phase is scheduled to be completed by the first quarter of 2012. In the second phase the company will invest INR6bn (USD128bn) depending on capacity utilisation in
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the first phase. In February 2006, Saint-Gobain Glass India commenced operations at its new automotive glass facility in Sriperumbudur, Tamil Nadu (India). The new facility has an installed capacity of one million car sets per annum, which is scalable to two million car sets. The company made an investment of INR14bn (USD314.5m, 28 February 2006) in the new plant
Contracts The company supplies windshields to the Toyota Corolla model from its Pune plant in Maharashtra (India). Certifications Both facilities run by Saint Gobain Sekurit are QS 9000 certified Financial Overview In the financial year ended 31 December 2010 Saint Gobain India generated sales of INR26.3bn (USD577.4m, 31 December 2010). Saint-Gobain Sekurit India, for whom the financial year ended on 31 March 2011, reported a 12.6% increase in net sales to INR939.4m (USD20.7m, 31 March 2011) compared with INR834.5m (USD18.5m, 31 March 2010) in the preceding year. The company gained from increased orders from its customers who reported strong growth in vehicle production in India during the financial year. Strong growth in sales drove Saint-Gobain Sekurit India to almost double its earnings from the previous year. The company reported profit before tax (PBT) of INR102.4m (USD2.3m) compared with INR50.4m (USD1.1m) in the previous financial year. Saint-Gobain Sekurit India concluded the financial year with net profit of INR100.1m (USD2.2m) over INR50.4m (USD1.1m) in 2010. Year 2011 2010 2009 2007 2006 Year 2011 2010 2009 2007 2006 Net Sales (INRm) 939.4 834.5 916.4 670.1 699.0 Net Sales (USDm) 20.7 18.5 17.6 15.2 15.8 Profit Before Tax (INRm) 102.4 50.4 4.3 (0.2) (99.5) Profit Before Tax (USDm) 2.3 1.1 0.08 (0.005) (2.3) Net Profit (INRm) 100.1 50.4 3.1 (1.1) (105.8) Net Profit (USDm) 2.2 1.1 0.06 (0.03) (2.4)
*The company changed its reporting period in 2009 from 1 January-31 December to 1 April-31 March. The company provided financials for fifteen months in 2009, and 2008 figures are not available. Outlook Saint-Gobain entered the Indian automotive market much later than Asahi India Glass India which caters to more than two-thirds of requirement of the automotive industry in the county. The French supplier has yet to make an impression on the staggering market share of the Asahi India. The company has contracts mostly for low volume models hence its volume of supplies remains low. Barring Hyundai Motors, which derives significant volumes for Saint-Gobain in India, the company has remained a niche supplier. However, this could change in coming years given several European automakers are investing in the Indian automotive market.
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Samvardhan Motherson Group

Wiring harness, plstic components
Address Motherson Sumi Systems Limited C-14 A&B Sector-1 Noida-201301 India Tel: +91-120-6752100 Fax: +91-120-2521866/2521966 Internet: http://www.motherson.com/ Senior Officers Mohinder Singh Gujral, Chairman Vivek Chaand Seghal, Vice-Chairman Pankaj Mittal, Chief Operating Officer (COO) Products Wiring Harness: high tension cords, battery cables, wires, connectors and terminals and wiring harness components Rearview mirrors: exterior mirrors, interior mirrors, mirrors with integrated lighting, blind spot detection systems and telescopic trailer tow mirrors Polymer processing & tool manufacturing: injection moulded plastic parts, plastic blow molded parts, post molding processes, assemblies,tool design and analysis and polymer compounding Modules: heating, ventilation and airconditiong (HVAC) systems, bus aircinditioning, lighting and air intake systems Elastomer processing: rubber injection molding, liquid silicon injection molding, bonded rubber parts, rubber extrusion and rubber compounding Metal working: precision metal machined components, gear cutting tools and thin film coating metals Manufacturing support: air compressors, paint coating equipment, automotive manufacturing engineering and auxiliary equipment for injection molding machines. Plants India (2)
Samvardhan Motherson Group (SMR) is one of the largest manufacturers of wiring harnesses and rearview mirrors in India. The company also provides IT, engineering and design services.
Motherson Sumi Systems Limited (MSSL) is a joint-venture between Samvardhana Motherson Finance Limited and Sumitomo Wiring Systems, Ltd, (Japan). The company is one of the leading suppliers of automotive wiring harnesses and mirrors for passenger cars in India. The company derived 93.3% of its total FY2011 sales from the automotive sector. SMR classifies its business into: mirrors (55.7% of FY2010 sales), wiring harness (30.4%), polymer components (10.8%), rubber/metal machined and other products (3.1%). MSSL serves several industries, including automotive, off-road vehicles, earthmoving and material handling equipment, agriculture and farm equipment, rubber and tire industry, elevators and industrial equipment. MSSL has manufacturing bases across Asia, Europe, North America, South America, Australia & Africa to support its customers. MSSL derived 39% of its total 2011 sales from India, 12% from America, 31% from Europe and the remaining 18% from Asia-Pacific excluding India. Maruti Suzuki is the companys largest customer from where it derived 14% of 2011 sales, followed by Hyundai (13%), Volkswagen (8%), Ford (8%), Renault Nissan (7%), GM (6%) and others constituted 44% towards its sales. Recent Developments Corporate strategy Over a period of years, Sumi Motherson Group has built a leadership in the plastics and wiring harness businesses. Over the past few years, Motherson Sumi has been expanding its international presence through strategic acquisitions. In 2009, the company along with SMFL acquired UKbased Visiocorp for EUR25m (USD35.8m, 31 December 2009). In July 2011, MSSL agreed to acquire 80% stake in German automotive plastic parts supplier Peguform, a major supplier of plastic components for the automotive industry. The acquisition will expand Motherson Sumis global presence, customer base and product offering to the global automotive industry. MSSL aims to increase its content per car by introducing higher value added components through joint-ventures and technical alliances. In 2011, MSSL announced plans to integrate group firm Sumi Motherson Innovative Engineering Limited (SMIEL). The merger will enable the company to handle its wiring harness business under one entity in India, thereby facilitating its decision-making process. MSSL has also announced plans to meet the increased customer demand with its decision to spend around INR5bn (USD110.1m, 31 March 2011) in FY2011-12 to expand capacity. The investment will be directed towards commissioning six plants in India, Hungary and South Africa in fiscal 2011. The company has secured some new contracts which include orders from Volkswagen, Maruti Suzuki, Renault Nissan, Toyota, GM and BMW for wiring harnesses. In the commercial vehicle segment new orders have been won from Mitsubishi Fuso, Daimler India, Commercial Vehicles and Tata Motors. In view of increased order intake, MSSL has increased the pace of its investment activities. During 2010, the company added new facilities in Chennai, Bengaluru and Haldwani. The wiring harness division also established new plants in Haldwani, Marunji (Pune), Urapakkam (Chennai)
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and Oragadam (Chennai). Sales INR81.75bn (USD1.8bn, 31 March 2011) (Year to 31.03.2011 ) Acquisitions In July 2011, MSSL acquired an 80% stake in German automotive plastic parts supplier Peguform for an undisclosed amount from Austria-based Cross Industries, which will continue to own 20% in Peguform post acquisition. The deal also includes buying 50% stake in Wethje Carbon Composite, which is part of Cross Industries. The acquisition is subject to regulatory and other approvals. The company supplies bumper systems, plastic parts for vehicle exteriors, vehicle cockpits, dashboards and vehicle interior trims. The acquired company operates 17 plants and five module centres in Germany, Portugal, Spain, Brazil, Mexico, China and Slovakia. The company supplies to most of the European automakers including BMW, Daimler, GM, PSA Peugeot Citron, Renault-Nissan and Volkswagen. In 2009, MSSL acquired the global rear-view mirror business of UK-based Visiocorp, the worlds largest vehicle rear view mirror producers, for an undisclosed amount. Visiocorp had 24% global market share in the automotive mirror business with 16 manufacturing plants worldwide at the time of acquisition. The acquisition significantly boosts its Indian parents R&D as it has direct control on 300 patents of the acquired company. In 2007, MSSL through its subsidiaries, Motherson Elastomers and Motherson Investments acquired the assets of Empire Rubber from Huon Corporation. The Australian based company was involved in rubber mixing and the manufacture of rubber extruded components. Motherson retained 100 of Empires employees and the business was taken over under a trading name- Silent Bloc in Australia. In 2006, MSSL purchased UK-based ASL systems, a manufacturer of wiring harnesses, electric/electronic control panels for buses & special purpose vehicles. The acquisition was made though its UK subsidiary, MSSL GB Limited. In 2006, MSSL acquired the door trim business of Huon Corporation of Australia. The move allowed the company to manufacture door trims for GM Holden Australia. In November 2006, MSSL acquired 100% shares of FP Formagrau s.r.o, a plastic injection molding company. Further deatils of the acquisition were not revealed. Investments In February 2011, MSSL announced that it planned to spend around INR5bn (USD110.1m, 31 March 2011) in financial year (FY) 2011-12 to expand capacity. The investment will be directed towards commissioning six plants in India, Hungary and South Africa in fiscal 2011. Contracts Brand/OEMs Toyota Maruti Suzuki Mahindra Renault Mahindra & Mahindra Models Corolla Zen Estilo, Swift Dzire, Swift, a Star, Logan Xylo Components Wiring harnesses High tension cords, wiring harnesses Bumpers Bumpers
Research and Development MSSL incurred INR122.2m (USD2.6m, 31 March 2011) or 0.44% of its total 2011 sales on research and development. Financial overview For the full year ended 31 March 2011, the companys net sales jumped by almost 22% y/y to INR81.75bn (USD1.8bn, 31 March 2011) compared with sales of INR67m (USD1.4m, 31 March 2010) for the same period in the corresponding year. Sales outside India improved by 5.6% y/y to INR49.2bn (USD1bn). At the same time, domestic sales increased significantly to INR32.51bn (USD716.1m) from USD20.43bn (USD453.6m) in FY2009-10. The companys net profit for the full year grew by 61% y/y to INR3.9bn (USD85.9m). Profit before interest and exceptional items grew significantly from INR4.49bn (USD99.7m) in FY2009-10 to INR6.88bn (USD151.5m) in FY2010-11. Higher sales and favourable gains from currency fluctuations contributed to the better performance.
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For the full year, automotive sales gained 16.5% y/y to INR79.27bn (USD1.7bn). The automotive segments profits totalled INR5.88bn (USD129.5m), gaining strength from INR4.79bn (USD106.3m) income reported in FY2009-10. Year 2011 2010 2009 2008 2007 Sales (INRm) 81,756 67,022 25,956 20,281 15,276 Sales (USDm) 1,800.8 1,488.3 497.4 508.2 351.6 Profit before tax (INRm) 6,312 3,427.8 2,559.8 2,262.2 1,623 Profit before tax (USDm) 139 76.1 49 56.6 37.3 Profit after Tax (INRm) 3,981 2,428 1,762 1,779 1,295 Profit after Tax (USDm) 87.6 53.9 33.7 44.5 29.8
Year 2011 2010 2009 2008 2007
Outlook MSSL continues to win new business from a diverse group of customers which includes contracts from Maruti Suzuki, Volkswagen, GM and BMW. The company which experienced a strong growth of 59% on consolidated basis and 68% on standalone basis in the fiscal year 2011 anticipates sales to grow further backed by new contracts secured in 2011. The company has set a target of USD5bn of sales by 2015 of which the company expects 70% to come from international customers. Further, the company also intends to expand its presence to 26-27 countries by 2015. MMSLs strong performance in FY2010-11 reflects the gains achieved by increased automotive demand in the domestic market. In 2010, Motherson Sumi went through restructuring, under which a plant in Germany was shut down and two plants in Australia were merged to create a single entity. The company now intends to capitalise on the automotive market demand and expand the portfolio. Overall, Motherson Sumi plans to invest INR6.5bn (USD143.1m) for the various expansion projects, with nearly 50% of the outlay targeted for international operations. In addition to organic growth opportunities, during the fourth quarter, Motherson Sumi acquired the business of India Nails Manufacturing Ltd. Further, the companys board approved the merger of a group company, Sumi Motherson Innovative Engineering Ltd. and two subsidiaries India Nails Manufacturing Ltd. and Motherson Global Wiring Ltd. with Motherson Sumi. Through these consolidation activities, the company is moving a step forward to achieve the target of becoming a USD5bn entity by 2015. MSSL expects that Peguform, in which it acquired an 80% stake, will help boost revenues in its polymers business. Peguform produces bumpers and plastic components at facilities in Brazil, Mexico and China. It mainly caters to the automotive industry in Europe, allowing MML to broaden its presence in the region. Post-acquisition of Peguform in November 2011, Motherson Sumi expects to generate about half of its sales from Europe. Acquisition of Visiocorp two years ago had already increased the companys exposure from the European market. While the company has new orders from its existing customers, it has also substantially expanded its customer base by supplying to new customers in India, thereby promising a healthy growth.
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Sandhar Technologies
Door locks, castings, brake panels
Address Sandhar Technologies Limited 3, HSIIDC Industrial Area Sector- 18, Old Delhi Gurgaon Road Gurgaon - 122015 Haryana India Tel: +91 124 4959 900/995 Fax: +91 124 401 2845 Internet: http://www.sldl.com Senior Officers DN Davar, Chairman Jayant Davar, Vice-Chairman & Managing Director Arvind Joshi, CFO & Company Secretary BK Sinha, COO, Sandhar Automotives DK Ashok, COO, Sandhar Automach Prasad RKSV Kanuri, COO, Sandhar Components RK Malik, Vice-President, Operations, Sandhar Automotives, HSCI division Sudhir Rana, Vice-President, Operations, Sandhar Components, Zinc & Plastic Vinay Mehrotra, Associate Vice-President, Operations, Sandhar components, Sheet Metal S Giridharan, Associate Vice-President, Engineering, Sandhar Automotives Products Aluminium die-casting, clutch and brake panels, door handles, fender & muffler assemblies, handle bar assemblies, latches & hinges, locking systems, moulds & dies, plastic injection moulding, sheet metal stamping, structural parts, vision systems, wheel rim assemblies, zinc die-casting Plants India (20): Haryana (9), Himachal Pradesh, Karnataka (4), Madhya Pradesh, Maharashtra (2), Tamil Nadu (2), Uttrakhand Outside India: Indonesia, Spain Sales INR10.4bn (USD229.1m, 31 March 2011) (Year to 31.03.11) Employees Group: 5,400 (2011)
Sandhar Technologies manufactures automotive locking systems and components. The company began with sheet metal stamping and later added locks and mirrors in its product portfolio. The company mainly caters to two-wheeler, passenger car and commercial vehicle manufacturers in India.
Sandhar Technologies commenced operations in 1985. The company operates its business through three subsidiaries. Sandhar Automotives: manufactures locking systems, vision systems, door handles, hinges and latches. The company operates six plants in India of which three are located in Gurgaon, Haryana and one each in Bangalore, Karnataka; Pune, Maharashtra and Haridwar, Uttrakhand. Sandhar Automotives has a technical tie-up with Honda Lock Manufacturing Company Limited Japan for lock kits for two-wheelers and mirror and door handles for four-wheelers. Sandhar Components: produces sheet metal, tubular components, zinc and aluminium pressure die casting and plastic injection moulded components. The company has two manufacturing plants in Gurgaon and one in Rewari, both in Haryana (India). In addition, Sandhar Components operates one plant each in Bengaluru, Karnataka and Pune, Maharashtra (both India). Sandhar Automach: is involved in making steel wheel rim forming, wheel assemblies, handle bar assemblies, clutch assemblies and brake panels. The company has one plant each in Bangalore and in Mysore, Karnataka and in Chennai and Hosur, Tamil Nadu (all in India). In addition, the company operates one plant each in Manesar, Haryana and Nalagarh, Himachal Pradesh.
Apart from this, Sandhar Technologies runs the following standalone businesses: Sandhar Tooling: a joint-venture Steady Stream Business Company Ltd, Taiwan formed in 2002. In 2011, Sandhar acquired a stake held by Steady Stream in the company and changed its name from Sandhar Steady Stream Tooling to Sandhar Tooling. The company operates an advanced tool & die designing and manufacturing facility in Gurgaon, Haryana (India). Sandhar Caama Components: a joint-venture formed with Caama India formed in 2010. Sandhar Caama produces structural parts and hydraulic winches for tractors and off highway vehicles at its plant based in Faridabad, Haryana (India). PT. Sandhar Indonesia: operates a plant in West Java (Indonesia) and manufactures wheel assemblies, brake panels, fork assemblies, lock sets, muffler and mirror assemblies. It supports the TVS plant in Indonesia. Sandhar Technologies Barcelona: Sandhar acquired Tecfisa in 2007 which operates a plant in Barcelona (Spain) to manufacture aluminium pressure die cast parts of medium weight for vehicle restraint systems, windscreen wiper systems, anti-vibration systems and suspension systems. The subsidiary supplies to major tier one suppliers including Autoliv, Bosch, Trelleborg, Saint Gobain and TRW. Indo Toolings: a joint-venture company formed between Sandhar and JBM Group in 2009 for advanced tool & die design, development, simulation, re-engineering and manufacturing of all types of tooling and try-out facilities. The JV manufactures toolings for stamping, plastic moulds, casting dies, forging dies and jigs & fixture at its plant in Madhya Pradesh (India). Sandhar Technologies supplies to major two-wheeler, passenger vehicle and commercial vehicle manufacturers in India. The companys major customers in India include GM, Hero MotoCorp, Honda Motorcycle and Scooter India, Hindustan Motors, Honda Seil Cars India, Mahindra & Mahindra, Maruti
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Suzuki, Royal Enfield, SML Isuzu, Tata Motors, Toyota, TVS and Yamaha. In addition the company caters to tier one suppliers, including Autoliv, Bosch, Continental, Delphi, Key Safety Systems, Lumax, Magneti Marelli, Rico, Trelleborg, TRW, Valeo and Visteon. Recent Developments Corporate Strategy Sandhar Technologies is scouting for acquisitions both in the domestic and the overseas markets. The company is keen on acquiring some companies in Europe and the US to expand its international presence. At the same time, the company intends to leverage technologies of the acquired companies in strengthening its new product development capability in India. The move is expected to help Sandhar expand business and add new customers. The company is also exploring acquisition opportunities in India and is in advance negotiation to acquire two companies in the domestic market. Sandhar intends to complete these acquisitions by the end of the current financial year in March 2012. The company is exploring technical collaborations or joint-ventures where acquisitions are not possible to keep abreast of newer technologies. Sandhar intends to enter into as many as five JVs in regions including one from Japan and South Korea and two from Europe by December 2012. Currently, the company has a technical collaboration with Honda Lock Manufacturing Company of Japan to manufacture lock sets for two-wheelers, and rear-view mirrors and door handles for four-wheelers. With the launch of Honda Brio in India, Sandhar expects to gain significant business from Honda Siel Cars India (HSCI). Sandhar is investing in expanding capacities in India to meet surging demand from its customers. The company spent INR1bn (USD22m, 31 March 2011) on capacity expansion in financial year (fiscal ) 2011 and has decided to invest a similar amount in fiscal 2012. The company is investing in a new manufacturing plant in Pune, Maharashtra (India) where it will relocate production of door handles, currently being produced at a rented plant in the same location. The plant will supply to GM India and Tata Motors. Further, the company also invested in its new manufacturing plant in Bawal, Haryana (India) which started operations in fiscal 2011. In addition, the company relocated production of aluminium die-castings from Mansear in Gurgaon to Bawal plant in Rewari, both in Haryana (India) and opened a new building for Sandhar Components in Behrampur, Haryana (India). The company is aggressively diversifying its business in order to reduce its overdependence on volatile auto component business. Sandhar has set a goal to have a balanced portfolio by fiscal 2020, generating 50% of its sales from the automotive sector, 30% from aerospace and the remaining 20% from engineering components related to appliances. The company aims to strengthen its research and development (R&D) capabilities and develop in-house technologies. With a view to achieving this level, Sandhar is working with laboratories and scientific institutions. Acquistions In February 2011, Sandhar acquired Steady Streams stake in a jointventure company, Sandhar Steady Stream Tooling Pvt Ltd. Postacquisition the company changed the name of the JV to Sandhar Tooling Pvt Limited. The wholly-owned company operates a plant in Manesar in Gurgaon, Haryana (India). In November 2007, Sandhar acquired Tecfisa, an auto component supplier based in Barcelona (Spain). Tecfisa produces aluminium die cast parts for vehicle restraint systems and wiper systems. The company also has finishing centres in Poland and Romania. This was Sandhars first acquisition made overseas. Joint-ventures In August 2009, Sandhar formed a joint-venture with JBM Group for advanced tool & die design, development, simulation, re-engineering and manufacturing of all types of tooling and try-out facilities. The jointventure company is named Indo Toolings Pvt. Ltd and is based in Indore, Madhya Pradesh (India). The plant produces toolings for stamping, plastic moulds, casting dies, forging dies and jigs & fixture.
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Investments In July 2011, Sandhar relocated its aluminum die-casting plant from Manesar in Gurgaon to Bawal in Rewari, Haryana (India). In March 2010, Sandhar established a new plant in Haridwar, Uttrakhand (India). The plant has lock & mirror assembly, sheet metal stamping, plastic injection moulding, zinc & aluminium pressure die casting and paint shop. In November 2009, Sandhar established a new door handling and machine assembly plant in Pune, Maharashtra (India). In 2007, Sandhar established a wheel assembly plant in Nalagarh, Himachal Pradesh (India). In July 2006, Sandhar established a manufacturing plant in West Java (Indonesia). The plant supplies to the local assembly plant operated by TVS Motors. In March 2006, Sandhar commenced operations at a wheel assembly plant in Chennai, Tamil Nadu (India). Financial Overview In the financial year ended 31 March 2011, Sandhar Technologies generated sales of INR10.4bn (USD229.1m, 31 March 2011). For financial year 2012, the company is expecting sales of INR13bn (USD285.9m). Being privately held, Sandhar Technologies does not publish details of its financial performance. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Sales (INRm) 10,390 8,090 6,600 5,600 4,200 Sales (USDm) 228.9 179.7 126.5 140.4 96.7
Outlook Sandhar Technologies has set a goal to become a billion dollar company (achieve sales of USD1bn) in near future and USD3bn to USD4bn by 2020. This means quadrupling growth in sales in the short term considering the company realised USD229.1m in the financial year ended 31 March 2011. In order to reach this figure, which is the aim of most companies operating in India, Sandhar is planning to go through inorganic routes of acquisitions and joint-ventures. While Sandhar is rapidly expanding its presence in its core automotive business, the company is working on reducing its overdependence on this sector and is diversifying into aerospace and other related sectors. This is expected to help the company to have a balanced products portfolio by fiscal 2020, generating half its sales from the non-automotive business.
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Setco Automotive
Clutch and precision components
Address Setco Automotive 2A Film Center Building Ground Floor 68 Tardeo Road Mumbai - 400034 Maharashtra India Tel: +91 22 407 55 555 Fax: +91 22 235 20 754 Internet: http://www.setcoauto.com Senior Officers Harish Sheth, Chairman & Managing Director Shvetal Vakil, Executive Director Udith Seth, Executive Director Sangamnath Digge, COO Radheshyam Kedia, Vice-President, Operations Vinay Shahane, Vice-President, Finance RK Ghosh, Director, Technical Products Clutch systems, pressings, precision components machined & heat treated Plants India (2): Gujarat, Uttrakhand Outside India: UK, US Sales INR3.02bn (USD66.5m, 31 March 2011) (Year to 31.03.11) Employees 925 (March 2011)
Setco Automotive is the largest manufacturer of clutches for medium & heavy commercial vehicles in India. The company also makes pressings and precision components for the automotive industry. In addition, the company manufactures hydraulics for the construction equipment industry.
Setco Automotive was incorporated in 1982, as Gujarat Setco Clutch Ltd. Two years later the company commenced operations from a manufacturing plant in Kalol in Vadodra, Gujarat (India). Presently, the company operates four manufacturing plants worldwide of which two are in India and one each in the UK and the US. In India, the companys plants are located in Vadodra in Gujarat and Sitargunj in Uttrakhand. Setco is considering one in special economic zone (SEZ) in Kutch, Gujarat. In financial year 2011, the company produced 618,374 clutch plates and 327,512 clutch cover assemblies. The company employs 925 people. The companys domestic market is categorised in three main segments: OEMs, Aftermarkets and Exports. In 2010-11, the company generated 43% of sales from OEMs, 49% from Aftermarket 49%, 6% from Exports 6% and 2% from others. Setcos customers primarily include commercial vehicle manufacturers including Ashok Leyland, Asia Motor Works, Daimler Trucks, GM, Tata Motors, and Volvo Eicher. Recent Developments Corporate strategy Setco Automotive has set a goal to become one of three global clutch manufacturers by 2015. The company has also a financial target to achieve INR10bn (USD220.3m, 31 March 2011) in sales by that year. In order to achieve these goals, the company is investing in capacity expansion, new product development and foraying into high-growth potential markets. In May 2011, Setco announced an investment of INR1bn (USD22.2m, 12 May 2011) for the expansion of clutch manufacturing in India. In addition to increasing capacities at its existing plants in Vadodra and Sitargunj, the company is planning to set up its third manufacturing plant in India in Kutch, Gujarat. Also, the company is considering the option to set up an assembly unit in Africa. Lack of medium and heavy duty commercial vehicles clutch manufacturers in the region presents a profitable venture for the company. Setco has traditionally focused on medium and heavy-duty commercial vehicle (M&HCV) segment of the automotive industry and currently enjoys around 80% share in the domestic market. The company is diversifying into light commercial vehicle (LCV) segment, which is the fastest growing in the commercial vehicles segment. The demand for LCVs is expected to remain robust in coming years as they are emerging as the preferable mode for the last mile transport. Export is another area which Setco is focusing. The company, which generated around 6% of sales from exports, intends this contribution to reach 15% in the near future. Setco has primarily concentrated on international markets where it has manufacturing presence, i.e the UK and the US. However the company is exploring export opportunities in other attractive markets including Middle-East, North America, Africa, Europe and Latin America. The companys two overseas subsidiaries Setco UK and Setco North America are expected to play a vital role in increasing its exports. Acquisitions In December 2006, Setco Automotive acquired a manufacturing facility of Haldex in Paris, Tennessee (US). The company acquired the assets of Haldex through its subsidiary Setco Automotive N.A. Inc. The deal was structured as an asset purchase deal on an ongoing basis and was valued at INR216.19m (USD4.9m, 31 December 2006). Joint-ventures In May 2009, Setco Automotive signed a joint-venture agreement with FTE
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Automotive GmbH to manufacture and supply brake and clutch components to automakers globally. The 51:49 joint-venture agreement also aims at supplying clutch actuation systems in India and will cater to the Indian passenger car market in the coming two years. In January 2008, Setco Automotive and FTE formed a joint-venture to manufacture and supply clutch actuation systems in India. The products are targeted at passenger cars and commercial vehicles. The joint-venture company is called FTE Setco Automotive.
Investments In July 2011, Setco Automotive plans to invest INR1.5bn (USD, 20 July 2011) to set up an assembly plant in north India and an assembly line for clutches in Africa by 2015. In May 2011, Setco Automotive announced an investment of INR1bn (USD22.2m, 12 May 2011) for the expansion of clutch manufacturing in India. Most of the investment will be utilised to increase production at the Kalol facility near Vadodara and the rest will be utilised to add capacity and for other R&D activities at the Uttarakhand plant. The company has targeted doubling capacity in the next three years. At present, the company produces a total of 500,000 clutches and 700,000 clutch discs. In January 2009, Setco Automotive announced its investment plan of INR2.5bn (USD49.9m, 16 January 2009) in Gujarat. The long-term investment is a part of the MoU signed between Setco and Government of Gujarat. Of the total amount, Setco plans to put up a new SEZ unit with an investment of INR750m (USD14.9m), INR500m (USD9.9m) at its Kalol plant for modernisation and expansion in the course of the following two years. And the company plans to invest INR1bn (USD19.9m) in FTE joint-venture plant near its main facility in Kalol. In April 2008, Setco Automotive inaugurated a manufacturing facility in Sitargunj, Uttarakhand (India) to produce clutch products, catering to the aftermarket customers. The company invested INR90m (USD2.03m, 10 April 2008) in the plant. The facility commenced production immediately after inauguration. In 2007, Setco Automotive announced a capacity expansion at its Gujarat based unit at an expense of INR250m (USD5.75m, 31 March 2007) in 2007. In 2006, Setco Automotive announced a capacity expansion at its Gujarat based unit at an expense of INR130m (USD2.91mm, 31 March 2006) in 2006. Contracts In June 2011, Setco held talks with Beiqi Foton to supply clutch gears for its heavy and medium trucks, when the OEM will enter India by the end of 2013 or beginning of 2014. In 2011, Setco was approved as the preferred supplier for Daimler-Benz for its trucks which will be introduced in India in beginning of FY2013. Setco supplies 90% of Tata Motors requirements for heavy commercial vehicle clutches and 80% of medium commercial vehicle clutches in 330 mm and 352 mm diameter sizes. Setco is the sole supplier to Eicher Motors. New Product Development In the financial year 2011, Setco spent INR2.4bn on research and development compared with INR9bn in the previous financial year. The companys UK-based subsidiary Setco UK is responsible for R&D for clutch products and acts as a technology provider to the group. Setco USA is the R&D hub for the hydraulic products. The company is also setting up an R&D unit at its Kalol plant in Gujarat (India) which is expected to become operational in 2012. Financial Overview In the financial year ended 31 March 2011, Setco recorded a 35.9% increase in consolidated net sales to INR3.5bn (USD78m, 31 March 2011), compared with INR2.6bn (USD57.m, 31 March 2010) in the previous year. Strong growth of its products in the commercial vehicle segment, both in original equipment (OE) and aftermarket, in India led the company to record strong growth in sales during the financial year. Higher sales drove the company to report strong growth in profits compared with the preceding year. Setcos profit before tax (PBT) more than doubled to INR439.5m (USD9.7m) compared with INR 194.6m (USD4.3m) in the previous financial year. The company concluded the financial year with net profit of INR355m (USD7.8m), more than double again from INR143.1m (USD3.2m) in the previous year.
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Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007
Net Sales (INRm) 3,544.9 2,608.3 2,320.0 2,101.6 1,558.0 Net Sales (USDm) 78.0 57.9 44.5 52.7 35.9
Profit Before Tax (INRm) 439.5 194.6 165.9 205.4 184.9 Profit Before Tax (USDm) 9.7 4.3 3.2 5.1 4.3
Net Profit (INRm) 355.0 143.1 133.2 135.8 130.6 Net Profit (USDm) 7.8 3.2 2.5 3.4 3.0
Outlook Setco Automotive has remained a preferred supplier in the medium- and heavy-duty commercial vehicle (M&HCV) segment enjoying nearly four-fifths market share in India. Several global commercial vehicle majors are entering into that segment. The company, as a leading clutch supplier, is expected to gain from this trend. The company is already taking proactive initiatives to win business from new customers. Setco has already been approved as preferred supplier of Daimler-Benz for its trucks to be introduced in India at the beginning of fiscal 2013. The company is in the advanced stages of negotiation with Beiqi Foton to supply clutch gears for its heavy and medium trucks, when the Chinese truck maker will enter India towards the end of 2013 or the beginning of 2014. Although a major supplier in M&HCV segment, the company is taking the right initiatives through diversifying into the light commercial vehicle (LCV) segment which is expected to be the growths major driver for commercial vehicles in India. This will not only reduce the companys overdependence on M&HCV but will also provide an additional market for revenues. The company is also working to expand its international presence. This will reduce the companys dependence on Indian automotive market to some extent. Considering the growth of the companys major focus market, M&HCV is directly related to growth of the economy, it is a good strategic move for the company to spread its geographic risks through increasing its presence beyond where it currently exports. The company intends to leverage its manufacturing presence in the US and UK to expand its international presence.
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Shriram Pistons & Rings

Pistons and rings
Address Shriram Pistons & Rings Ltd 3rd Floor, Himalaya House 23, Kasturba Gandhi Marg New Delhi-110001 India Tel: +91 11 2331 5941 Fax: +91 11 2331 1203 Internet: http://www.shrirampistons.com/ Senior Officers Pradeep Dinodia, Chairman AK Taneja, Managing Director & CEO R Srinivasan, Joint Managing Director & Company Secretary Rajiv Sethi, Executive Director Anil Gadi, Executive Director VK Jayaswal, Executive Director PS Ladiwala, Executive Director & CFO Naveen Agarwal, Controller Subrata Neogy, Senior General Manager Meenakshi Dass, Whole Time Director Products Engine valves, pistons, rings Plants India (2): Rajasthan, Uttar Pradesh Sales Group: INR8.2bn (USD182.1m, 31 March 2011) (Year to 31.03.2011) Employees 2,500 (March 2010)
Shriram Pistons and Rings is a major supplier of pistons, piston rings, pins and engine valves in India. The company makes gasoline and diesel pistons, cast iron, steel and moly piston rings.
Shriram Pistons was incorporated in 1963. The company, a part of Shriram Group, operates two manufacturing plants in India which are located in Ghaziabad, Uttar Pradesh and Pathredi, Rajasthan. As of 31 March 2011, Shriram Pistons had installed capacity to produce 17.06m units of piston, 11.86m pins, 83.78m piston rings and 31.03m engine valves. The company supplies its products to two-wheelrs, passenger cars and commercial vehicles. Shriram Piston caters to both OEMs and aftermarkets. In India the company counts almost all automakers as its major customers. In the global market the comapny caters to Honda, Ford, Renault, Iveco, Kia, and Wabco. In addition, Shriram Pistons has significant international presence and generates nearly one fifth of its revenue from exports. Recent Developments Corporate Strategy Shriram Pistons is ramping up the production of pistons and rings after witnessing a surge in demand for these components. In March 2010, the company announced it would invest INR7bn (USD155.4m, 31 March 2010) over the following six years at its Pathredi plant, near Bhiwadi in Rajasthan (India). The first phase of plant expansion became operational in March 2011. The company commenced the second phase of expansion at the Pathredi plant in financial year 2012. Shriram Pistons ramped up production capacity of pistons and rings at the plant. The company commenced production of engine valves and pins during the financial year. Shriram Pistons has set a goal of transforming itself from a component manufacturer to a complete solution provider. The company has design, prototyping, and engine testing capabilities. Shriram Pistons plans to strengthen itself in simulation and validation which would allow it to cater to customers requirements faster and at lower cost. Investments In March 2010, Shriram Pistons announced plans to invest INR7bn (USD155.4m, 31 March 2010 over the next six years to expand its plant at Pathredi, near Bhiwadi, Rajasthan (India). In the first phase the company invested INR2bn (USD44.3m) which started production at the beginning of 2011. The company will further boost production with its plans to invest INR1bn (USD22.1m) annually over the following five years. In September 2009, Shriram Pistons announced plans to invest INR2.25bn (USD46.5m, 30 September 2009) to set up a manufacturing plant at Patheredi, Rajasthan (India). The plant became operational in March 2010. It manufactures pistons and other components for automotive industry. New Product Developments In financial year 2011, Shriram Piston spent INR99.1m (USD2.1m, 31 March 2011) on research and development (R&D). The R&D expenditure was equivalent to 1.2% of the companys sales during the financial year. Shriram Pistons has technical alliance with Germany-based KSPG and Japan-based Riken, Fuji Oozx and Honda Foundry. Financial Overview In the financial year ended 31 March 2011 Shriram Pistons reported a 13.8% increase in net sales to INR8.3bn (USD182.2m, 31
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March 2011) compared with INR7.3bn (USD161.1m, 31 March 2010) in 2010. Higher sales were driven by increased demand from the companys customers in both original equipment (OE) market and the aftermarket. In addition the company reported a 9% increase in exports to INR1.5bn (USD32.9m) compared with INR1.4bn (USD30.5m) in the previous financial year. Shriram Pistons reported profit before tax (PBT) of INR1.2bn (USD25.8m), up 13.7% over INR1bn (USD22.9m). During the financial year the company witnessed a sharp increase in expenses on raw materials and power, which impacted its earnings. The company recorded net profit of INR826.9m (USD18.2m), against INR689.2m (USDUSD15.3m) in the previous fiscal. For the financial year ending 31 March 2012 Shriram Pistons expects to exceed INR10bn (USD220.2m) of sales. The company also expects a 10% to 12% increase in exports during fiscal 2012. Year 2011 2010 2009 2008 Year 2011 2010 2009 2008 Net Sales (INRm) 8,270.0 7,257.3 5,817 5,342 Net Sales (USDm) 182.2 161.2 111.5 133.9 Profit Before Tax (INRm) 1,170.6 1,030.0 650 793 Profit Before Tax (USDm) 25.8 22.9 12.4 19.9 Net Profit (INRm) 826.9 689.2 302 413 Net Profit (USDm) 18.2 15.3 5.8 10.3
Outlook Shriram Pistons performance has come under pressure recently due to sharp increase in prices of raw materials, especially aluminium, nickel, silicon and pig iron. In addition, the companys margin has been impacted due to an increase in power tariff by the government, establishment of own generation of power due to shortage in supply and depreciation of the Indian rupee against the US dollar. Still, the medium to long term outlook for Shriram Piston remains positive. The company is a major supplier of engine components including pistons, piston ring, pins and engine valves. Automakers everywhere, including in India, are upgrading engines to meet stringent norms in the area of fuel consumption and vehicle emission reduction. This positions Shriram Pistons well to benefit from this automotive industry trend in coming years.
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Sigma Group
Vibration control components
Address Sigma Corporation (India) Limited R-561, Shankar Road New Rajinder Nagar New Delhi -110060 India Tel: +91 11 2874 5134 Fax: +91 11 2874 5850 Website: http://www.sigmacorporation.com/ Senior Officers Jagdip Singh, Chairman Taranjit Singh, Managing Director Ram Prakash, Executive Director Kabir Singh, Director, Strategic Planning Jagmit Singh, Director Preet Singh, Director Products Sigma Group: Brake chambers, Hydraulic bushes, hydraulic mounts, spring brakes Sigma Freudenberg NOK: Bellows, diaphragm, hydraulic accumulators, hydraulic seals, O rings, oil seals, pneumatic seals, radial shaft seals, shock absorber seals, valve stem seals, vibration control- bushes, mounts, pads Sigma Vibracoustic: Drivetrain: decoupled pulleys, torsional vibration dampers, driveshaft bearings/link shafts, centering bushes, rotary absorbers Chassis: Conventional bushings, complete bushing sets, chassis modules, hydro bushings, subframe mounts, linear dampers, hatchback decouplers Powertrain: Conventional bushings and mounts, hydro bushings and mounts, torque struts Suspension: Air spring modules, air spring struts, air spring dampers, hybrid top mounts, jounce bumpers, spring isolators, top mounts Plants India (5): Haryana (3), Punjab (5) Sales NA Employees NA
Sigma Corporation is a major supplier of automotive rubber components in India. The company manufactures engine, transmission mounts and hydraulic mounts and bushes for automotive and industrial applications.
Sigma Group was established in 1964. The company supplies a diverse range of more than 10,000 engine and transmission mounts and other rubber components. The company operates following companies: Sigma Corporation: the flagship company of the Sigma Group. The company operates a manufacturing plant in Bhondsi, Gurgaon, Haryana (India). The plant manufactures brake chambers, hydraulic bushes and mounts and spring brakes. Sigma Freudenberg NOK: a 50:50 joint-venture with Freudenberg NOK formed in 2001 to supply automotive and industrial seals to automakers operating in India. The JV operates two manufacturing plants in Mohali, Punjab (India). Sigma Vibracoustic: formerly called Sigma Phoenix, is a 50:50 JV formed in 1999 between Sigma Corporation and Germany-based Phoenix AG. In 2001, Phoenix merged its anti-vibration product business with Freudenberg and formed a separate entity called Vibracoustic. In accordance with the merger, Sigma Phoenix changed its name to Sigma Vibracoustic. The JV manufactures a diverse range of anti-vibration products for chassis, drivetrain, powertrain and suspension at its three manufacturing plants located in Mohali, Punjab (India). Sigma Moulds & Stampings: a wholly-owned subsidiary of the Sigma Group which supplies precision moulds, tools, dies, & sheet metal components for automotive industry. The company operates a manufacturing plant in Manesar, Gurgaon, Haryana (India). Sigma Automotive Materials: is a dedicated sourcing arm for Sigma Groups global JV partners and other tier one suppliers for procuring metal components such as iron castings, forgings, high and low pressure die castings, gravity castings, aluminium extrusions, metal stampings, tubes, tools, dies mouldes and fixtures. The company operates a 40,000ft2 warehouse in Manesar, Gurgaon Haryana (India) with in-house testing and inspection facilities.
Sigma Group supplies components to automakers and tier one suppliers in India and the overseas markets. The groups major customers in India include Ashok Leyland, Daimler, Eicher, Escort, Ford, GM, JCB, Mahindra & Mahindra, Maruti Suzuki, New Holland, Tata Hendrickson, Tata, Volkswagen and Volvo. The company also supplies to tier one supplies including Bosch, Brakes India, Delphi, Endurance, Lucas TVS, Magna, Rane TRW, Shanti Gears, Tenneco and Varroc. Recent Developments Corporate strategy Sigma Group is leveraging its strategic alliances with Germany-based Freudenberg Group. The groups JVs Freudenberg NOK and Vibracoustic have significantly expanded its presence in India. In 2007, Sigma Vibracoustic set up its third manufacturing unit in Mohali, Punjab (India) to manufacture anti-vibration products. The strategic partnerships have also helped the Indian company to expand its exports. For example Sigma Vibracoustic exports nearly 75% of its production to its customers in Europe. The JVs major customers include Daimler, Ford, GM, Volkswagen and Volvo. Sigma Freudenberg NOK is concentrating on two markets, seals for twowheelers and vehicle engine and transmission applications. The JV currently enjoys a strong business position in damper seals, being one of the key suppliers to Munjal Showa, Endurance Technologies and Gabriel India, who produce dampers for two- and four-wheelers. Apart from damper seals, Sigma
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Freudenberg NOK manufactures engine and transmission seals that are supplied to Maruti Suzuki, Tata Motors, Mahindra & Mahindra and GM India. Investment In May 2007, Sigma Vibracoustic set up a new production unit in Punjab (India) to manufacture anti-vibration products. The plant was set up with an investment of INR750m (USD18.3m, 31 May 2007) and is spread over an area of 100,000 ft2. Contracts Sigma Freudenberg NOK was awarded a single source contract to supply 10 types of engine and transmission seals for the Tata Nano project. The project is expected to generate annual revenues worth INR 250m (USD5m). The contract is for five years for engine and transmission seals. The company has also received a contract to supply engine seal for Nano diesel and Nano Europa. Sigma Freudenberg NOK provides crank seals to Maruti Suzukis vehicles. Sigma Freudenberg NOK received a single source contract from GM to supply small car engine and transmission seals. Sigma Freudenberg NOK provides seals for the sigma engine used in the Ford Fiesta and Ford Ikon. Sigma Freudenberg NOK secured a single source contract to supply its products from Ford. All the samples are already approved. Sigma Vibracoustic supplies components to Mercedes Benz. New Product Developments Sigma Vibracoustic is focusing on research and development in the field of vibration control products for various application areas such as drivetrain, powertrain, chassis and suspension. The company also undertakes R&D along with its joint-venture partner Vibracoustic. The company operates an in-house design centre in Mohali, Punjab (India). In January 2010, Sigma Vibracoustic displayed its advanced hydraulic mounts for premium cars and air suspensions for trucks at the Auto Expo held in New Delhi (India). The company already supplies these hydraulic mounts to global automakers and has now introduced the product in the domestic market. In January 2008, Freudenberg announced that its subsidiary Vibracoustic GmbH based in Germany developed the engine-suspension concept for the new Tata Nano. The components for the system are produced by SVIL, which also produces engine and drivetrain seals for the Nano.
Financial Overview Sigma Group is privately owned and therefore does not publish details of its financial results. Outlook Sigma Group has significantly benefited from its strategic jointventures with Freudenberg and NOK who are market leaders in oil seals and precision rubber moulded parts. The alliances have not only broadened the product line of the Indian partner, but have also expanded its customer base. In addition, the strategic partnerships have helped the Indian partner to significantly increase its exports. Sigma Group and its JV companies, with strong presence in anti-vibration technologies are well positioned to grow in India where vehicle sales are projected to triple in the next ten years.
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SKF India
Bearing and sealing solutions
Address SKF India MG Memorial Building Netaji Subash Road Charni Road Mumbai - 400002 India Tel: +91 22 6633 7777 Fax: 91 22 2281 2738/9074 Website: http://www.skf.com/portal/skf_in Senior Officers Shishir Joshipura, Managing Director & Country Manager Ranjan Kar, Director, Automobile Business Unit Ajit Krishnan, Managing Director, Sealing Solutions India Amar Bharat, Director, Business Excellence & Sustainability Arun Shivaram, Director, Global Technical Centre India Chandramowli Srinivasan, Director, Finance Products Bearings, housing/sleeves & accessories, linear motion products, seals, special steel, spherical plain bearings Plants India (3): Karnataka (1), Maharashtra (1), Uttar Pradesh (1) Sales INR20.7bn (USD454.9m, 31 December 2010) (Year to 31. 12.10) Employees 1915 (2011)
SKF India is part of the world's leading bearings and seals supplier SKF AB of Sweden. The Indian subsidiary is a market leader in the bearing industry in India and caters to the automotive, electrical and industrial sectors. The company generates about 90% of its sales from ball bearings business.
SKF Group commenced operations in India as a trading company in 1923, and the company consolidated its operations in the country through the acquisition of Lincoln Helios. The Swedish bearings and sealing systems supplier operates in India through SKF India and SKF Technologies Limited. SKF India operates four business units in India: Automotive Business Unit (ABU), Electrical & Two-Wheeler Business Unit (ETW), Industrial Business Unit (IBU) and Service Business Unit (SBU). The company generated 28% of 2010 sales from ABU, 22% from ETW, 24% from IBU and 26% from SBU. The ABU supplies wheel hub bearing units, taper roller bearings, small deep groove ball bearings, seals, special automotive products and complete repair kits for the vehicle service market. SKF India operates three manufacturing plants in India which are located in Bangalore, Karnataka; Pune, Maharashtra and Haridwar, Uttrakhand. The Haridwar plant caters only to the two-wheeler segment. The company supplies to all major automotive manufacturers in India. Recent Developments Corporate strategy SKF Group, the parent company, has been focusing on stepping up investments in rapidly growing automotive markets such as Brazil, China and India. In 2011, the company established a new manufacturing plant in Jinan in Shandong Province (China) while in Brazil the company extended a plant to produce the second generation hub bearing unit (HBU2) with integrated anti-lock braking system (ABS). In India, the Swedish bearing major has increased capital expenditure to meet surging demand for its products. In February 2011, SKF India disclosed plans to invest INR1.6bn (USD35.6m) in capacity expansion in financial year 2011 compared with INR1bn (USD21.5m) in 2010. Most recently, in December 2011, the company inaugurated a Global Technical Center in Bangalore, Karnataka with an investment of INR500m (USD9.2m, 31 December 2011). The technical centre, which also houses a metallurgy and chemical laboratory, will focus on product development in the Indian market. The company plans to employ 400 engineers by 2015. Investments In December 2011, SKF India inaugurated a Global Technical Center in Bangalore, Karnataka (India). The company intends to employ 400 engineers at the centre by 2015. It will focus on product engineering, development and testing. Besides the centre will work as a global laboratory for metallurgy chemistry and analysis of the performance of bearings. The company has invested INR500m (USD9.2m) in the technical centre. In February 2011, SKF India announced plans to boost its capital expenditure for the year to INR1.6bn (USD35.6m), from INR1bn (USD21.5m) in the previous year. The company will invest funds in ramping up operations at all three production units Pune, Bangalore and Haridwar. The company plans to increase its production capacity across all its facilities by 25-30% in 2011, with plans to add two new production lines at its plant in Pune for automotive and industrial sectors. In November 2009, SKF India opened its first solutions factory in Pune, Maharashtra (India). The factory manufactures products from the
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companys bearings and units, seals, mechatronics, services and lubrication solutions technology platforms. In April 2007, SKF India announced an investment of INR1.5bn (USD36.4m, 30 April 2007) to establish a greenfield ball bearing plant in Haridwar (India). The plant, established on a 10-acre site, began operations in April 2010 and supplies components to several major local automakers including Tata Motors and Hero MotoCorp. The plant has an installed capacity of 45 million bearings a year. In November 2004, SKF India opened a research and development centre in Bangalore, Karnataka (India).
Contracts In 2008, SKF Sealing Solutions received a contract to supply transmission shaft seals (drive shaft seal and input shaft seal), valve stem seals, engine shaft seals (front and rear crankshaft seals) for the Hyundai i20 in India. SKF India supplies McPherson strut bearing units for the Honda City and the Maruti Swift models. The company recently won an order from Piaggio, Europe and Honda Indonesia for the supply of solid oil ball cage bearings. Certifications SKF Indias Bangalore plant is accredited with TS 16949 / ISO 14000 certifications. The companys Pune plant is accredited with ISO 9001 ISO 140041 OHSAS 18001 certification. SKF Indias Haridwar plant has ISO 14001 & OSHAS 18001 certifications. New Product Developments SKF India has established SKF Application Development Centre for R&D activities in areas such as application engineering, product and system design, advanced calculation and simulation, manufacturing of prototypes, testing and validation. The R&D centre in Bangalore opened in 2009. Last year, the SKF Group announced plans to transform it into a global technical centre. SKF India has developed a range of belt-tensioners. In January 2006, SKF India announced the launch of "SKF Grease" for the automotive aftermarket in India. Financial Overview For the fiscal year ended 31 December 2010, SKF India recorded a 31.7% increase in net sales to INR20.7bn (USD454.1m), compared with INR15.7bn (USD335m, 31 December 2009) in the previous year. Higher sales led the company to record a 66.4% increase in profit before tax (PBT) to INR2.7bn (USD58.4m) over INR1.6bn (USD38.1m) in 2009. SKF India concluded the financial year with net profit of INR1.8bn (USD38.9m), an increase of 87.8% increase over INR942m (USD20.1m) in the previous financial year. Year 2010 2009 2008 2007 2006 Year 2010 2009 2008 2007 2006 Net Sales (INRm) 20,684 15,709 16,202 15,683 13,424 Net Sales (USDm) 454.1 335.0 325.9 397.7 304.3 Profit Before Tax (INRm) 2,660.7 1,598.6 1,944.0 2,473.6 1,504.5 Profit Before Tax (USDm) 58.4 34.1 39.1 62.7 34.1 Net Profit (INRm) 1,770.2 942.5 1,277.0 1,607.1 1,019.6 Net Profit (USDm) 38.9 20.1 25.7 40.7 23.1
Outlook SKF is performing well in the Indian market, having recovered excellently from the economic downturn of 2008 and 2009. Post slowdown, the company continues to invest in ramping up capacities. This bodes well for the company in the light of rising demand in the Indian automotive market.
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However, SKF Indias operating margins have been impacted by several external factors such as high inflationary pressures, rising interest rates, adverse currency movements and higher commodity prices. The Indian subsidiary of the Swedish bearing major recognises the near-term challenges but maintains that the longer-term outlook of the local vehicle industry remains encouraging. The parent groups focus on growing auto markets such as India is also likely to be advantageous for the Indian subsidiary in the long term.
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Sona Koyo
Steering system columns and assemblies
Address Sona Koyo Steering System Ltd. 38/6, NH-8, Delhi-Jaipur Road, Gurgaon 122002 Haryana India Tel: +91 124 468 5000 Fax: +91 124 410 4611 Website: http://www.sonagroup.com Senior Officers Dr. Surinder Kapur, Chairman Sunjay Kapur, Vice-Chairman & Managing Director Sunder Rajan, CEO K.M. Deshmukh, Deputy Managing Director Jag Mohan Kapur, Director Products Carrier differential assembly, column type electronic power steering assembly, intermediate drive shaft assembly, manual steering column assembly, propeller shaft assembly, rack & pinion type hydraulic steering column assembly, rear axle assembly, tilt and telescopic column Plants India: Gujarat, Haryana (2), Tamil Nadu Sales INR12.03bn (USD264.9m, 31 March 2011) Employees 700 (2011)
Sona Koyo Steering System is the largest manufacturer of steering systems for passenger cars and utility vehicles in India. The company also makes propeller shafts and axle assemblies for the automotive industry. The company generates 95.5% of sales from India.
Established in 1985, Sona Koyo Steering Systems is the flagship company of the Sona Group. In the same year, the company entered into a technical collaboration with Japan-based Koyo Seiko (now JTEKT) to manufacture manual steering gears and columns. One year later, the company entered into a joint-venture agreement with Maruti Suzuki. Sona Koyo commenced commercial production in 1987 from a manufacturing plant in Gurgaon, Haryana (India). Sona Koyo Steering Systems operates the following companies: JTEKT Sona Automotive India: a joint-venture company with JTEKT in which Sona Koyo holds a 49% equity. The company manufactures column type electric power steering (C-EPS) systems at its plant in Bawal, Haryana (India). In addition the JV has satellite plants in Chennai, Tamil Nadu and Bidadi, near Bangalore, Karnataka (both in India) to supply the local unit of Nissan and Toyota respectively. Sona Fuji Kiko Automotive: a 51:49 joint-venture company between Sona Koyo Steering Systems and Fuji Kiko. The company manufactures C-EPS Steering columns and operates a plant at Bawal, Haryana (India). Sona Stamping: formerly known as Arjan Stamping, the company is a jointventure between Sona Koyo Steering Systems and Arjan Auto Pvt. Ltd formed in 2007, with the former holding a majority stake. The company manufactures stamped and fabricated parts and assemblies for steering columns, seating or steering suspension applications. In addition to Sona Koyo Steering Systems, the Sona Group operates other companies such as Sona Okegawa Precision Forgings (produces precision forged bevel gears, differential case assemblies and synchroniser rings), Sona BLW Przisionsschmiede (precision forged components), Sona Somic Lemfrder Components (ball joints for steering systems and suspension components), Mahindra Sona (propeller shafts) and Sona e-Design and Technologies. The company generated 84.2% of its financial year 2011 sales from Steering & Column and the remaining15.8% from Driveline components. India remains the major market for Sona Koyo, accounting for 95.5% of its sales. The company generated the remaining 4.5% from exports. The major customers of Sona Koyo Steering include Maruti Suzuki, GM India, Hindustan Motors, Hyundai Motors, Mahindra & Mahindra, SML Isuzu, Tata Motors and Toyota Kirloskar. The company also supplies to tier one suppliers including Mando India and Suzuki Powertrain India in the domestic market. In addition, Sona Koyo supplies JTEKT, Mando USA, Sigma ASL UK, Transaxle Manufacturing USA, Lotus, Fuji Autotech, JCB and Toyota Motor in the overseas market. Recent Developments Corporate strategy Sona Koyo is investing in capacity expansion to meet expected surge in demand for its products in India and international markets. In September 2011, the company announced plans to invest INR1bn (USD21.6m, 6 September 2011) in the financial year 2012 to ramp up capacities at its existing plant. During the financial year the company commenced operations at a manufacturing plant in Sanand, Gujarat (India) which supplies to Tata Nano.
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Sona Group, the parent company of Sona Koyo, has primarily relied on strategic partnerships for growth. Apart from JTEKT which has been its technical partner since its inception, Sona Koyo has entered into a joint-venture with Arjan Auto, American Axle and Manufacturing, Fuji Kiko, Somic Ishikawa and Lemfrder Metallwaren. However, at the beginning of 2011, the Indian partner decided to divest its stake in AAM Sona Axle to its US partner American Axle Manufacturing. In the past few years most suppliers, including those in India, have suffered from sharp increase in raw material costs. Sona Koyo is not an exception to that. In order to deal with the rising cost, the company is focusing on improving manufacturing efficiency and increasing localisation of components. The company has also taken strategic initiatives in backward integration. The company is setting up an aluminium die-casting plants in Dharuhera near Gurgaon, Haryana (India). Acquisitions In January 2008, Sona Okegawa Precision Forgings, a subsidiary of the Sona Group, acquired ThyssenKrupp Przisionsschmiede GmBH, the forging business of ThyssenKrupp AG. The acquired business operates three facilities in Europe and one in the US and supplies to passenger cars, truck and heavy-duty components industry and enjoys around 24% market share in the forging business. The major customers of the European operations are Daimler, Chrysler, Volkswagen, GM, Renault, BMW and ZF Lemfrder.Financial details of the transaction were not divulged by either company. In October 2007, Sona Koyo bought majority stake in Arjan Stampings Ltd to make it a subsidiary. ASL was formed as a joint-venture between Sona Koyo Steering and Arjan Auto to export stamped parts to overseas associates. Arjan Stampings operates a plant in Farukhnagar, Haryana (India), which commenced operations in April 2008. Joint-Venture In August 2007, Sona Koyo entered into a joint-venture agreement with its long-term Japanese partner JTEKT to manufacture column-type electronic power steering (C-EPS) in India. JTEKT owns a controlling stake of 51% in the JV while the rest is with the Indian partner. The two partners will invest INR1.5bn (USD36.7m, 23 August 2007) in a new manufacturing plant in Bawal, near Gurgaon, Haryana (India). The JV, JTEKT Sona Automotive India, commenced production in financial year 2010. In January 2007, Sona Koyo entered into a 51:49 joint-venture agreement with Fuji Kiko to produce column-type electronic power steering (C-EPS) in India. The JV, Sona Fuji Kiko Automotive Ltd., has been established to meet the requirement of JTEKT Sona Automotive India and the global customers of the Japanese partner JTEKT. The JV set up a manufacturing plant in Bawal, near Gurgaon, Haryana (India). The plant became operational in financial year 2010. Investments In September 2011, Sona Koyo Steering announced plans to invest INR1bn (USD21.6m, 6 September 2011) in fiscal year 2011-12 for capacity expansion. The investment will be directed at expanding existing facilities in the Dharuhera-Gurgaon region of northern India. In addition, the company announced plans to set up a new pressure die casting unit at Dharuhera, in Haryana (India). The plant is expected to become operational by end 2011. In 2011, Sona Koyo commenced production at its new manufacturing plant in Sanand, Gujarat (India). The plant supplies to Tata Motors low cost car, the Nano. In 2011, Sona Koyo established an aluminium die casting plant in Dharuhera, Gurgaon, Haryana (India). The company set up an aluminium die casting plant in an attempt to have some backward integration to reduce the cost of production. The company invested INR500m (USD11m, 31 March 2011) in this project. In August 2010, Sona Koyo announced it would invest INR800m (USD17.1m) to increase production capacity at its existing facilities. The company invested in expanding capacity of steering columns, steering gears and electronic steering systems. The company completed capacity expansion by the end of the financial year in March 2011.
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Divestments In January 2011, Sona Koyo divested its 30% company AAM Sona Axle to its US-based Manufacturing. The JV was operating a Pantnagar, Uttarakhand (India) and produced trucks and passenger cars.
stake in the joint-venture partner American Axle manufacturing plant in axle assemblies for light
Contracts In 2012, Sona Koyo will begin supplying Mahindra & Mahindra w408 programme, Maruti Suzuki YP8 programme and Tata Ace (0.5 ton) In 2011, JTEKT Sona Koyo set up a satellite plant in Chennai, Tamil Nadu and Bangalore, Karnataka (both in India) to supply Nissan and Toyota Kirloskar column-type electric power steering systems (C-EPS) to these two automakers. In 2011, Sona Koyo started supplying to Ford Fiesta and Figo, Martu Suzuki Alto K-Series, Tata Ace (1ton) and Sonalika Rino,. In 2010, Sona Koyos subsidiary Sona Fuji Kiko Automotive commenced supplying jacket assembly and intermediate shaft for Nissans Micra and Maruti Suzukis WagonR models. The company also supplies jacket assembly for Toyota Etios. In 2008, Sona Koyo received a contract to supply steering systems for Chevrolet Spark. New Product Developments Sona Koyo has been steadily expanding its research and development (R&D) expenditures over the past few years. In the fiscal year ended 31 March 2011, the company spent INR23.6m (USD519,630, 31 March 2011) on R&D activities, up from INR15.5m (USD343,550) in the previous year. The companys R&D expenditure during financial year 2011 was equivalent to 0.2% of its sales. Sona Koyo has been awarded an international patent titled Electric Power Assist Module for Steering System for off-highway vehicles segment. The technology is ready for commercial production. The company intends to enter the commercial vehicle market and farm equipment segments in 2012. In addition, the company is carrying out R&D for development of an electric assisted power steering system for small commercial vehicles. Financial Overview In the financial year ended 31 March 2011, Sona Koyo reported a 41.1% increase in consolidated net sales to INR12bn (USD265.1m, 31 March 2011) compared with INR8.5bn (USD189.4m, 31 March 2010) in the previous year. Strong growth in sales was driven by better than expected performance of Sona Koyo as a stand-along company as well as growth in contribution from subsidiaries including JTEKT Sona Automotive India, Sona Fuji Kiko Automotive and Sona Stampings. As a stand-along company Sona Koyo reported 21.3% increase in net sales to INR10.3bn (USD226.9m). The company reported a 20.4% increase in domestic sales to INR9.85bn (USD217m) while exports surged 45.9% to INR463m (USD10.2m). Higher sales led Sona Koyo to report strong growth in earnings compared with the preceding year, though the company recorded a 32.4% jump in consumption of raw materials to INR8.4bn (USD186.2m) and 51.1% increase in staff costs (USD19.6m) during the financial year. The company posted earnings before interest and tax (EBIT) of INR1.1bn (USD24.2m) over INR567.3m (USD12.6m) in the previous financial year. Sona Koyo tripled its profit before tax (PBT) to INR736.5m (USD16.2m) compared with INR254m (USD5.6m) in the previous year, while net profit jumped more than doubled to INR446.3m (USD9.8m) over INR169.5m (USD3.8m) in financial year 2010. Year 2011 2010 2009 2008 2007 Net Sales (INRm) 12,033.7 8,528.0 6,920.0 6,836.8 5,807.5 Profit Before Tax (INRm) 736.5 254.0 (460.9) 390.3 415.7 Net Profit (INRm) 446.3 169.5 (314.7) 249.1 277.1
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Year 2011 2010 2009 2008 2007
Net Sales (USDm) 265.1 189.4 132.6 171.3 133.7
Profit Before Tax (USDm) 16.2 5.6 (8.8) 9.8 9.6
Net Profit (USDm) 9.8 3.8 (6.0) 6.2 6.4
Outlook According to the Society of Indian Automobile Manufacturers (SIAM), the passenger vehicle market in India is expected to reach five million units by 2015. As a leading supplier of steering systems for passenger cars and utility vehicles, Sona Koyo is well positioned to benefit from the growth of the Indian automotive industry. Meanwhile, Sona Koyo is exploring new avenues for growth to strengthen its financial performance. The company has developed the Electronic Power Assist Module for off-highway vehicle applications. Sona Koyo has set up production lines to manufacture the module at its Dharuhera plant in Gurgaon, Haryana (India). The company is preparing for mass production in 2012. The diversification into new business segments will help the companys top line growth. In addition, the company is considering entering into contracts manufacturing for OEMs. If the strategy materialises, it can open new revenue streams for the company and will also help it scale up the supply chain.
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Steel Strips Wheels

Steel Wheel Rims
Address
Steel Strips Wheels Ltd. S C O 49-50, Sector 26 Madhya Marg Chandigarh 160 019 India
Steel Strips Wheels (SSW) is a leading supplier of single piece steel wheel rims to the automotive industry in India with a market share of 55% in the passenger car segment, 25-30% in tractor wheels and around 45% in truck wheels in India. The company supplies rims in the range t h e 10- to 30-inch diameter range for scooters, passenger cars, utility vehicles, trucks and tractors.
SSW has been manufacturing single piece steel wheels since 1991. The companys product range comprises wheels for passenger cars, multi-utility vehicles (MUVs), commercial vehicles, two-wheelers and three-wheelers. The company operates three manufacturing plants in India with one each located in Jamshedpur, Jharkhand; Dapper, Punjab and Chennai, Tamil Nadu. The total installed capacity at all three plants is 16 million units wheels, making the company one of Asias leading steel wheel suppliers. The facility in Jamshedpur manufactures truck wheels and currently is under expansion. The company has entered into a strategic partnership with GS Global Corporation (Korea) in January 2011, Sumitomo Metal Industries (Japan) in December 2010 and Kalimati Investment Company (unit of Tata Steel, India) in January 2008 in order to expand globally. In the passenger vehicle segment, the firms major Indian customers are Maruti Suzuki, Tata Motors, Honda Siel, Mahindra and Mahindra (M&M), Nissan, Volkswagen and GM. In the tractor segment, SSW supplies to M&M Tractors, Punjab Tractors, International Tractors, Eicher, Escorts and New Holland. The companys truck wheel customers include Swaraj Mazda, Tata Motors and Ashok Leyland.
Tel: + 91 172 279 0979/3112

Fax: +91 172 279 4834/0887 Internet: http://www.sswlindia.com
Senior Officers
RK Garg, Chairman Dheeraj Garg, Managing Director AV Unnikrishnan, Deputy Managing Director Ute Mayr, Whole-time Director M M Chopra, Director
Products
Steel wheel rims
Plants
India (3): Jharkhand, Punjab , Tamil Nadu
Sales
INR6.6bn (USD135m, 31 March 2011) (Year to 31.03.11)
Recent Developments
Employees
3000 (2011)
Corporate strategy SSW is focusing on expanding its customer base as well as increasing its present share of business with existing customers. In addition, the company is concentrating on tapping high growth potentials from export markets. The companys export has made significant progress since it entered the export market around six years ago. SSW has received orders from European automakers such as Audi, BMW, PSA Peugeot Citron and Renault. The company is working to increase its presence in high-margin commercial vehicles and tractor segments. SSW established a manufacturing plant in Jamshedpur, Jharkhand (India) to produce wheel rims for commercial vehicles. The unit became operational in 2010 and has an installed capacity of one million rims per year, which is expected to be ramped up to 1.7 million units by early 2012. SSW is also setting up a truck wheel rim plant in its existing facility in Orgadam, Chennai, Tamil Nadu (India). The plant will have annual production capacity of 500,000 wheel rims and will especially cater to commercial vehicle manufacturers. The plant is expected to become operational in 2012. Meanwhile, SSW has added or upgraded capacities at its existing manufacturing facilities and is capable of producing 55,000 tractor wheel sets per month compared with 35,000 units earlier. SSW is planning to raise USD16m by end 2011 through selling stakes in the company to the global wheel rim makers. However, the company will continue to hold at least 50% stake to retain control on management. The company intends to use proceeds from the transactions to fund its capacity expansion. The company is planning to establish a manufacturing plant in Pune, Maharashtra (India) to produce wheel rims for passenger vehicles, tractors and construction equipment. The company also plans to build a manufacturing plant in Morocco to supply Renault. In November 2009, the company received a contract to supply three million wheel rims to the French automaker over a period of five years. In December 2010, SSW received foreign direct investment of USD10m from
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Japan-based Sumitomo Metal Industries (SMI). One month later, the company received an USD5m investment from South Korea-based GS Global Corporation. Following these investments SMI owns a 5.73% and GS Global a 2.54% stake in SSW. The capital infusion is expected to help SSW meet funding requirement to expand capacity in coming years. Investments In April 2011, SSW commissioned its second phase production facility at Orgadam, Chennai, Tamil Nadu (India). With the new line becoming operational, the total installed capacity was ramped up from 2.5 million to six million wheel rims per year. In February 2011, SSW announced it woulde set up truck wheel rim plant in its existing facility in Orgadam, Chennai, Tamil Nadu (India). The plant will have annual production capacity of 500,000 wheel rims and will especially cater to commercial vehicle manufacturers such as Ashok Leyland and Tata Motors. The plant is expected to become operational by March 2012. In 2011, SSW added capacity at its main Dapper plant in Punjab (India). With this the total installed capacity at the plant was raised from 7.5 million wheel rims to nine million wheel rims a year. In July 2010, SSW commenced operations at its new truck wheel rim facility at its Jamshedpur in Jharkhand (India). The company started supplying tube-type heavy commercial vehicle wheel rims to Tata Motor. Soon the facility intends to start supplying to Ashok Leyland. In April 2006, SSW announced an investment of INR1.48bn (USD32.8m, 30 April 2006) to expand production capacity of its Dapper plant, Chandigarh (India). The investment increased its capacity from 2.4m to 7.5m wheel rims per year.
Contracts In October 2011, SSW secured a supply contract from a European trailer manufacturer. The contract has potential to reach 60,000 wheels per year with approximate value of INR220m. The company will supply wheels from its newly established Jamshedpur plant in Jharkhand (India). In July 2011, SSW won a USD33m contract from BMW to supply steel wheels for its new launches between 2013 and 2014. The annual volume of contract is 265,000 per year and supply will start in November 2013 to BMWs Oxford, Leipzig and Regensberg plants in Germany. SSW is already supplying steel wheels to BMWs Oxford plant for its Mini models. In April 2011, SSW received a contract from Volkswagen. The company will supply 100,000 steel wheels rims a year for next five years to the automakers plant in Germany and South America. The contract worth INR536.4m (USD12m). In February 2011, SSW won a supply contract from Renault. Under the contract the company will supply 20,000 wheels per month. The award is for five years and will involve 1.2 million wheels for the French automakers new model to be launched in Russia at end 2011. The contract is worth EUR30m (USD41.2m). In January 2011, SSW won a 600,000 wheels order from PSA Peugeot Citron. Under the contract, the company will supply nearly 0.6 million steel wheels over a period of the next five years to the French automakers plants across Europe. The contract is valued at USD9m. SSW has supplied the PSA Group for past four years. In December 2010, SSW commenced supply of steel wheels rims to Tata Motors. The company supplies the steel wheels from its newly established Jamshedpur plant in India. In July 2010, SSSW started exporting steel wheels to BMWs plant in Oxford (UK) for its Mini model. The company will export 48,000 wheels annually for Mini. In July 2010, SSW secured contracts from Audi. The company started supplying in the first quarter of 2011. The contract worth USD38m and for five years. In March 2010, Renault selected SSW as key supplier to supply steel wheel rims for one of its new vehicles to be launched in early 2011.
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New Product Developments SSW spent INR20m (USD0.5m) on research and development in the financial year 2011 (R&D) compared with INR48.3m in the preceding year.
SSW has developed a new wheel for the three-wheeler segment and is expecting a volume of 200,000 units in the first year of production. The wheels have been improved by a significant reduction in weight helping to increase vehicle performance and reduce overall cost of production. Certifications The company has been accredited with ISO/TS 16949:2002 and ISO 14001:1996 status. The company has also been accredited with ISO 9002 and QS 9000. The company has been accredited with OHSAS 18001 in accordance with SA 8000 for labour and social aspects.
Financial Overview In the financial year ended 31 March 2011, SSW

generated net sales worth INR6.6bn (USD135m, 31 March 2011) compared with INR4.2bn (USD90m, 31 March 2010) in the previous year which is an increase of 32.15%. The company sold 9.6 million wheel rims during the financial year; up 34.1% over 7.2 million sold in the previous year.
Higher sales led the company to report an 81.5% increase of INR355.7m (USD7.3m) compared with INR196m (USD4.2m) in the previous financial year. SSW concluded the financial year with a net profit of INR298m (USD6.1m) over INR145.2m (USD3.1m) in 2010. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm)
6,561.6 4,193.4
Profit Before Tax (INRm)

355.7 196.0
Net Profit (INRm)

298.0 145.2
3,173.1 2,607.9 2,000.1 Net Sales (USDm) 144.5 93.1 60.8 65.4 46.1
127.6 233.5 191.2 Profit Before Tax (USDm) 7.8 4.3 2.4 5.8 4.4
77.9 164.7 140.3 Net Profit (USDm) 6.6 3.2 1.5 4.1 3.2
Outlook Within a short span of three years SSW has emerged as one of the most recognised Indian suppliers to internal automakers such as Audi, BMW, PSA Peugeot Citron, Renault and Volkswagen. The company is one of the leading Indian suppliers benefiting from plans of global auto makers to source components from emerging markets such as China and India where the costs are lower, compared to the developed markets.
SSW is now planning to focus on manufacturing alloy wheels for its export markets. This is expected to improve the companys operating margins. Overall, the company has set a goal to become one of the top three steel wheel manufacturers in the world.
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Sterling Tools
Fasteners
Address Sterling Tools Limited Plot No. 4, DLF Industrial Estate Faridabad-121 003 Haryana India
Sterling Tools is a major supplier of high tensile cold forged fasteners to automotive industry. The company caters to both OEMs and the aftermarket in India.
Sterling Tools Limited commenced its operations in 1979. The company produces over 2,000 types of fasteners including standard, engine, chassis and special fasteners. Sterling Tools operates three plants, of which two are located in Faridabad and one in Palwal, both in Haryana (India). As at 31 March 2011, the company employed 609 people. The company supplies to two-wheelers, three-wheelers, passenger cars, commercial vehicles and farm tractors segments. Sterling Tools generates 29% of its sales from commercial vehicles, 22% from farm equipment, 18% from passenger vehicles and 12% from aftermarket. The company drives 5% of the sales from two-wheelers, 3% each from tier one suppliers and exports and the remaining 8% from others. Sterling Tools generates about 75% of its sales from OEMs. The companys major customers in India include Bajaj Auto, Eicher, Escorts, GM, Hero MotoCorp, Maruti Suzuki, Suzuki Motorcycle and Tata Motors.
Tel: +91 11 5161 5428 Fax: +91 11 2681 0091 Internet: http://www.stlfasteners.com
Senior Officers M L Aggrawal, Chairman Anil Aggarwal, Managing Director Atul Aggarwal, Whole Time Director Sanjeev Bhardwaj, Vice-President, Finance Products Chassis fasteners: centre bolts, hub nuts, hub/wheel bolts, propeller shaft bolts/nuts, rivets, suspension bolts, track shoe bolts/nuts, two wheeler spindles/ wheel axles, wheel studs Engine fasteners: balance weight bolts, connecting rod bolts/ nuts, cylinder head bolts/ screws, fly wheel nuts/ bolts, main bearing cap bolts Standard fasteners: hexagon nuts, hexagonal head bolts, socket head cap screws, studs, weld nuts Special fasteners: custom made bolts to suit clients specifications Plants India: Haryana (3) Sales INR2.5bn (USD54.6m, 31 March 2011) (Year to 31.03.11) Employees 609 (2011)
Recent Developments
Corporate strategy Sterling Tools continues to focus on its core area of supplying fasteners to OEMs operating in India. In financial year 2011, the company entered into a licensing agreement with US-based Illinois Tools Works (ITW) to produce and sell certain metal fasteners in India. In addition to OEMs, the company has also intensified focus on strengthening its presence in the aftermarket. The company is taking initiatives to increase exports and development of new export markets. Sterling Tools has entered into a strategic alliance with companies in Europe during financial year 2011 to increase its share of its business in the international market. As a result the company has been able to double its exports revenue during the financial year to USD126.9m (USD2.8m) over INR57.3m (USD1.3m) in the previous year. While the automotive industry remains the major focus for Sterling Tools, the company is diversifying its operation with the aim to serve the non-automotive fasteners market. In March 2010, Sterling Tools entered into a joint-venture (JV) with the Netherlands-based Borstlap Masters in Fasteners Group (FABROY). The 50:50 JV, Sterling Fabroy India Private Limited, aims to capitalise on the growing demand for non-automotive fasteners in emerging market in south Asia. The JV will focus on wholesale distribution, supply chain and vendor management of automotive and non-automotive fasteners.
Joint-Venture In 2010, Sterling Tools entered into a licensing agreement with US-based
Illinois Tools Works (ITW) to produce and sell certain metal fasteners in India.
Contracts
Sterling Tools supplies engine fasteners to the Tata Ace program. Sterling Tools supplies fasteners to Maruti Suzuki Swift program.
Certification
Sterling Fasteners has been accredited with ISO 14001 and ISO/TS 16949 certifications for its Faridabad plants
Financial Overview In the financial year ended 31 March 2011, Sterling Tools recorded a 38.1% increase in net sales to INR2.5bn (USD54.6m, 31 March 2011) compared with INR1.8bn (USD39.9m, 31 March 2010) in the previous year. Strong
increase in sales was driven by robust growth in the domestic market. In addition, the company also benefited from significant growth in exports which more than doubled to INR126.8m (USD2.8m) compared with INR57.3m (USD1.3m) in 2010. The company reported profit before tax (PBT) of INR236.6m (USD5.2m) compared with INR186.4m (USD4.1m). Sterling Tools posted net profit of INR157.3m (USD3.5m) as opposed to INR115.9m (USD2.6m) in the previous financial year. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 2,479.4 1,795.3 1,509.3 1,548.9 1,396.3 Net Sales (USDm) 54.6 39.9 28.9 38.8 32.1 Profit Before Tax (INRm) 236.6 186.4 29.9 120.3 108.3 Profit Before Tax (USDm) 5.2 4.1 0.6 3.1 2.5 Net Profit (INRm) 157.3 115.9 16.0 76.1 68.9 Net Profit (USDm) 3.5 2.6 0.3 1.9 1.6
Outlook Sterling Tools is the largest supplier of fasteners in the Indian
automotive industry. This positions the company well to gain from the growth of the Indian automotive industry in coming years. Rising input costs is a major area of concern for Sterling Tools. The company continues to face pressure on its margins due to high cost of steel, which is the main raw material used in the production of fasteners. In addition to high raw material costs, the companys earnings are under pressure due to high cost of power. This has compelled Sterling Tools to continue to focus on managing costs prudently. Sterling Tools deals in the business which hardly requires much technology. As a result the company faces severe competition from the unorganised sector in India. In addition, Sterling Tools faces the risk of relatively cheap imports of fasteners from other low cost manufacturing countries like China which could impact its sales and earnings. However, Sterling Tools intends to move up the value chain by adding higher yield products to its portfolio of fasteners for the automotive industry. This is expected to help increase Sterling Tools profit margins.
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Subros
Air-conditioning systems
Address
Subros Limited Lower Ground Floor World Trade Centre Barakhamba Lane New Delhi 110001 India
Subros is the largest manufacturer of automotive condensers in India with a market share of 40%. The company has an integrated set-up producing the complete HVAC unit in-house.
Subros was incorporated in 1985 as three-party joint-venture between Suri Brothers and associates, Denso Corporation and Suzuki Motor to produce automotive air-conditioning systems for Maruti Suzuki. The Suri family owns 40% in the JV while Denso and Suzuki Motor each has 13% stake in the company. The company manufactures compressors, HVAC (heating, ventilating and airconditioning), piping and heat exchangers for vehicles, as well as providing auto air-conditioning and engine cooling systems. Subros operates six manufacturing plants in India and one in Thailand. Of the six plants in India, the company operates two in Uttar Pradesh and one each in Gujarat, Haryana, Maharashtra and Tamil Nadu. Over the past 25 years the company has increased its capacity of 50,000 air-conditioning units in 1985 to 1.2 million air-conditioning units per year. Maruti Suzuki continues to remain the biggest customer of Subros accounting for 73% of its sales. The company generates 16% to Tata Motors and 8% to Mahindra & Mahindra, while the remaining 3% from others. Subros entered the commercial market by supplying cabin air-conditioning for higher tonnage trucks to Ashok Leyland, Eicher and Volvo. Other customers include Denso Kirloskar Industries (DNKI), Hindustan Motors, Reva, AC Delco and Force. Subros opened its sixth facility in Thailand in December 2008 to support Tata Motors Thailand.
Tel: + 91 11 2341 49 46/47/48/49 Fax: + 91 11 2341 4945 Internet: http://www.subros.com Senior Officers
Ramesh Suri, Chairman Shradha Suri Marwah, Managing Director DM Reddy, CEO RP Gupta, COO HK Agarwal, Head, Finance
Products
Busair-conditioning, compressors, condensers, engine cooling module, evaporators, HVAC
Plants
India (6): Gujarat, Haryana, Maharashtra, Uttar Pradesh (2), Tamil Nadu Outside India: Thailand
Recent Developments
Corporate strategy Subros is investing in capacity expansion keeping in mind the potential growth of the Indian automotive industry. The company has set a goal to double its production capacity to two million units over three to four years. Subros is setting up three new manufacturing facilities located in Sanand, Gujarat; Pune, Maharashtra and Chennai, Tamil Nadu (all in India). These manufacturing plants are expected to become operational by 2012. The company is broadening its product portfolio. Subros has so far mainly focused on air-conditioning systems, but is now planning to enter other thermal system products, such as radiators, engine cooling modules and bus airconditioning. The companys upcoming plant in Pune, Maharashtra will produce heat exchangers and engine cooling modules. In order to speed up new product development, the company entered into a joint-venture agreement with Denso in June 2010 to design car air-conditioning systems and other thermal systems products. The passenger vehicles segment has been major focus of Subros all these years. The company is now diversifying to supply to commercial vehicle manufacturers. The company is in discussion with several commercial vehicles manufacturers including Ashok Leyland to supply air-conditioning systems. Joint-ventures In June 2010, Subros entered into a joint-venture agreement with its strategic partner Denso Corporation to set up a company to design car air-conditioning systems and other products. The JV called, Denso Subros Thermal Engineering Centre India Limited, became operational in September 2010. It is based at Subros facility in Noida, Uttar Pradesh (India). Denso owns the controlling stake of 74% in the company while the remaining 26% is with Subros. The two partners made an initial investment of INR136m (USD3m, 30 June 2010).
Sales
Employees
c. 4000 (2011)
403
Investments In August 2010, Subros announced plans to set up a new manufacturing plant in Chennai, Tamil Nadu (India). The new facility will primarily supply air-conditioning systems to commercial vehicles. In August 2010, Subros announced it would invest INR1bn (USD21.3m, 31 August 2010) in next two years at its existing facilities to expand production capacity. The investment will allow Subros to ramp up capacity to 1.5 million units compared with the one million units in 2010. The increased capacity will help the company to meet expected growth in demand for air-conditioning systems in coming years. In July 2010, Subros announced plans to set up manufacturing plants in Pune, Maharashtra and Sanand, Gujarat (both in India). The company established plant in Sanand to supply car air-conditioning systems to Tata Motors. The plant became operational by the end of the financial year 2011. Subros is setting up its second plant in Pune to produce heat exchangers and engine cooling modules. The Pune plant of the company is expected to become operational by the end of financial year 2012. In August 2008, Subros announced an investment of INR1bn (USD22.7m, 31 August 2008) to establish an assembly facility for airconditioning systems for Tata Motors in Thailand for the Tata Xenon. The facility will initially supply 5,000 systems for the programme which will be scaled up to 15,000 units by 2011.
Contracts In 2010, Subros started supplying to Marut Suzuki New WagonR and Alto K10. Subros started supplying auto air-conditioners to Tata Nano in 2010. In 2009, Subros started supplying Maruti Suzuki A-Star and Eeco. In 2009, Subros commenced supplyingair-conditioning kits to Mahindra Xylo. In 2009, Subros commenced supplying Tata Indica Vista. Subros was selected by Tata as the supplier of compressors for the Tata Safari and blowers, heaters, tubes and hoses for the Tata Indica. The company supplies various components for other cars and some trucks in the Tata stable. Subros supplies components for A/C system and heater unit for the Mahindra Reva electric car. In 2007, Subros receive approval to supply Maruti Suzukis Swift. The company also commenced supplying SX4. In 2007, Subros commenced supplying to Mahindra & Mahindra. Subros manufactures compressors for the Maruti Alto, WagonR, condensers for Maruti Alto, SX4, Wagon R; evaporators for the Maruti Alto, Wagon R; blowers for Maruti Alto, and Wagon R. The company also manufactures heaters, tubes and hoses for the Maruti Alto and the Wagon R.
New Product Developments Subros spent INR41m (USD0.9m) on research and development (R&D) in the financial year ended 31 March 2011, compared with INR60.5m (USD1.3m) a year ago. The company spends less than 1% of its sales on R&D.
Subros is developing products such as sub-cooled condensers, RS evaporator and Variable Displacement Compressor which will help reduce power consumption. In 2010, Subros entered into another joint-venture with Denso Corporation to design car air-conditioning systems and other products. The JV, Denso Subros Thermal Engineering Centre India Limited, became operational in September 2010. It is based at Subros facility in Noida, Uttar Pradesh (India). In 2011, Subros developed 10SL08 compressor as design upgrade for 10P08 compressor. In fiscal year 2010-2011, Subros received a contract for developing HVAC and hoses for New Alto, heater blower unit development for Omni and HVAC and condenser development for Swift model of
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Maruti Suzuki. Subros is developing HVAC for a new MPV X2 on the Safari platform. Subros is working towards bringing second generation compressors to the domestic market. In 2008, Subros developed new generation series compressor 10SA13 which is compact, light in weight and will be used in most Maruti Suzukis models. In 2008, the company commenced supply of condensers, compressors, hoses and tubes for Maruti A-Star. In 2008, Subros developed new HVACs for Maruti Suzuki, Tata Motors and Mahindra & Mahindra. The company also developedairconditioning for large bus and tractors.
Certifications Subros has been accredited with ISO 9002 and QS 9000 certifications. Subros has been accredited with TS 16949, ISO 14001 & OHSAS 18001 certifications.
Financial Overview In the financial year ended 31 March 2011 Subros

reported a 19.8% increase in its consolidated net sales to INR10.9bn (USD240.4m, 31 March 2011) compared with INR9.1bn (USD201.2m) last year. The company benefited from strong growth in orders from its main customers in India, including Maruti Suzuki which reported record growth in vehicle production of 1.2 million units during the financial year.
Despite strong growth in sales, the company reported decline in profit before tax (PBT) due to sharp increase in material costs and other expenses. Subros witnessed a 21.5% increase in material costs to INR8.2bn (USD180.6m) while its other expenses shot up 28.6% to INR1.8bn (USD39.6m). The company reported PBT of INR321.9m (USD7.1m) compared with INR397.9m (USD8.8m) in the previous financial year. However net profit for financial year increased marginally to INR286.4m (USD6.3m) against INR283.5m (USD6.3m). Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 10,915.8 9,061.7 6,940.3 6,626.4 6,473.9 Net Sales (USDm) 240.4 201.2 133.0 166.1 162.2 Profit Before Tax (INRm) 321.9 397.9 184.1 411.2 400.2 Profit Before Tax (USDm) 7.1 8.8 3.5 10.3 10.0 Net Profit (INRm) 286.4 283.5 132.4 286.3 284.4 Net Profit (USDm) 6.3 6.3 2.5 7.2 7.1
Outlook Subros has continued to maintain its market leadership by aligning itself to the top two OEMs, Maruti Suzuki and Tata Motors. The company expects to gain from capacity expansion plans by these two automakers in coming years. Subros strategic partner Maruti Suzuki continues to invest in capacity expansion to meet expected surge in vehicle demand. The automaker is setting up two manufacturing plants at its Manesar manufacturing complex in Haryana (India) which will result in additional capacity of 500,000 units. In addition, Indias leading automaker is also considering investing in a new plant in Mehsana, Gujarat (India), which will eventually have annual production capacity of two million units. As a major supplier to Maruti Suzuki, Subros is well positioned to gain in coming years.
The companys decision to diversify its product line beyond air-conditioning systems is a move in the right direction. This will enable Subros to not only reduce its over-dependence on air-conditioning systems but also position itself as a major supplier of thermal systems. Subros strategy to enter the commercial vehicle segment should help it win new business,broaden its customer portfolio and reduce its dependence on Maruti Suzuki and Tata Motors.
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Sunbeam Auto
Aluminium die-castings
Address
Sunbeam Auto Ltd, 38/6 K.M Stone, Delhi-Jaipur Highway, Narsingpur Gurgaon - 122 001, India
Sunbeam Auto, a part of the USD2.2bn Hero group, was formed as part of Hero Honda Motorcycles' vendor development strategy. Today the company is a large supplier of castings and pistons to the automotive industry.
Sunbeam Auto, formerly a unit of Highway Cycles Ltd, was established as an ancillary to Hero Honda Motorcycles in 1987 to develop import substitute components. The company supplies aluminium die-castings for two-wheelers and four-wheelers. Presently the unit has an installed capacity to produce 21,500 MT aluminium die-casted components per annum and has further ambitions to enhance the capacity. The product range varies from 10grams to 6.25kgs in pressure die-castings, low pressure die-castings and gravity die-casted components. The group has another die casting plant located at Ludhiana established in 1984 supplying components to Hero Cycles and Majestic Auto Limited. The plant also has the capacity to manufacture zinc die-casted components. The company is setting up an aluminium die casting unit at Alwar in Rajasthan and the project was scheduled for completion in September 2011. Sunbeams customers in India include Hero Honda Motors, Maruti Suzuki, Munjal Showa Ltd and Sona Koyo Steering Systems. The company entered the export market in 1998 and supplies to Eralmetall (Germany), Robert Bosch (USA) and Visteon Powertrain Control Systems (USA).
Tel: +91 124 4129200 Fax: +91 124 4129751-52 Internet: http://www.sunbeamauto.com Senior Officers
Ashok Kumar Munjal, Managing Director PN Sandhu, Senior Vice President, Operations
Products
Alternator housing, bottom cases, brake levers, caliper brakes, cap crank bearings, clutch levers, crank cases and covers, cylinder blocks, cylinder heads and covers, hubs, hinges, pistons, motor trager links, rocker arms, seat benches, sliding tubes, trager generator and transmission cases.
Recent Developments
Plants
Gurgaon (Haryana)
Sales
c. INR7.8bn (USD157.3m, 31 March 2009)
Corporate strategy Sunbeam has managed to maintain a healthy position in the aluminum die-cast component (ADCC) market with continous support from Hero Motor Corp Limited (HMCL) with whom Sunbeam has a business relationship. A leading supplier of ADCC and pistons, the company has established two facilities in Rajasthan to further strengthen its presence in the domestic market. Sunbeam has also established a strong R&D capability allowing it to grow in the aluminium die-cast components business. The company derives 70% of its revenues from the two-wheeler industry. Joint-ventures Sunbeam Auto has a technical collaboration with Honda Foundry Company Ltd (Japan) for its pistons unit, Sunbeam Auto Pistons. It has a production capacity of four million pistons per annum and supplies to both two- and four-wheelers. Investments In November 2010, Sunbeam Auto announced plan to set up an aluminium die castings facility at Tapokra in Alwar district of Rajasthan. The plant will have a capacity of 33,000 tonnes per annum and will start with an invesment of INR100 crore. In November 2010, Sunbeam Auto announced it would set up an aluminium die castings facility at Tijara in Alwar district, Rajasthan with a capacity of 33,000 tonnes and an investment of INR90 crore. Contracts Sunbeam is developing throttle bodies for supply to Robert Bosch Corp. USA which is to be used for GM USA. Sunbeam supplies front and rear alternator housing to Visteon Powertrain Control Systems India on the basis of a long term arrangement. Sunbeam has also developed starter motor housing and diode plates for Visteon Powertrain USA. Certifications The company has been accredited with QS 9000 & ISO 9002 status.
Employees
5000 plus (2011)
406
New Product Developments Sunbeam has developed the components of Hero Puch Motorcycles of 50cc and 65cc. Financial Overview For the fiscal year 2010-11, Sunbeam reported a significant increase in profit after tax of INR264.9m (USD5.3m, 31 March 2011) as compared to INR129.6m (USD2.6m, 31 March 2010). The net sales of the company rose 27.5% to INR9.55bn (USD192m, 31 March 2011) against INR7.49bn (USD150.6m, 31 March 2010). Outlook Sunbeam Autos growth comes mainly from Hero Honda and Maruti Suzuki. The close proximity of Sunbeams manufacturing units to HMCL has helped the company keep a tab on its freight and inventory costs. The company plans to increase supply of components HMCL and Maruti Suzuki (MSIL) in the coming months and diversify its export customer base. Sunbeam will also work towards reducing its power cost by increasing the share of low-pressure castings, increasing usage of molten metal, and obtaining a gas pipeline connection by end 2011. These measures will help the company to tackle the pricing pressure from OEMs as well as maintain profitability. Since Sunbeam is dependent on HMCL for its revenue growth, it needs to widen its client base in order to avoid the disturbance/unrest in the company which directly impacts Sunbeams operations.
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Sundaram Clayton
Aluminium castings and components
Address Sundaram Clayton Limited Jayalakshmi Estates 5th Floor 29 Haddows Road Chennai 600 006 Tamilnadu India Tel: + 91 44 28272233 Fax: + 91 44 28257121 Internet: http://www.sundaramclayton.com Senior Officers C N Prasad, Group President, CEO, Automotive Products division H Lakshmanan, Executive Director V N Venkatanathan, Executive Vice-President, Finance Ram Natrajan, President, Automotive Products division PH Narayanan, President, Die-casting division Lakshmi Venu, Vice-President, global business development and strategy R Murali, Senior Vice-President, Finance Products Housings, adaptor oil filters, air connectors, case transaxle assembly, castings, charge air pipes, chain cases, clutch housing, compressor cover assembly, cover coolant ducts, cylinder head covers, cylinder heads, fly wheel housings, filter heads, filtration module, fuel pump housings, fork gear shifts, gear housings, lube oil cooler cover assembly, lube oil filter heads, intake manifolds, inlet manifolds, oil pans, starter housings, transmission cases, turbo chargers, Plants India (3) Sales INR8.2bn (USD182.6, 31 March 2011) (Year to 31.03.2011 ) Employees 1,200 (June 2005)
Sundaram Clayton, a part of TVS group is a leading supplier of aluminium die-castings in India. The company has OE clients in passenger car, commercial vehicle, two-wheeler and diesel engine segments. The company also serves the export markets.
TVS Clayton was formed in 1962 as a joint-venture between TV Sundaram Iyengar & Sons and Clayton Dewandre Holdings Limited for the production of compressors, servos units, slack adjusters, reservoirs, hoses and non-ferrous castings. In 1972, an aluminium foundry was set up for nonferrous castings. In 1977, WABCO acquired Clayton Dewandre. Sundaram Clayton has five business segments: Automotive Components, Motor Vehicles, Computer peripherals, Financial Services and Others. Sundaram Clayton operates three plants, one each in Padi, Mahindra World City, all in Tamil Nadu (India). Hosur and
Sundaram Clayton supplies to BMW, Cummins, Cummins Turbo Technologies, Daimler, Delphi-TVS, Ford, Honda, Hyundai, Komatsu, Nissan, Renault Trucks, Tata, Visteon and WABCO among others. Recent Developments Corporate strategy Sundaram Clayton has decided to focus on its core business of die-casting and in line with this strategy, in August 2010 the company announced plans to separate the non-auto business and list it as a separate company. After this, Sundaram Clayton will have two companies, one focused on auto and the other on non-auto business. The board of directors have also approved the proposal to acquire the entire paid-up capital of INR500,000 (USD10,550, 30 August 2010) of Sundaram Investment Ltd (SIL), and demerge the non-automotive related business of the company into SIL, and the merger of TVS Investments Ltd with SIL. The board also gave approval for the merger of Anusha Investments Ltd with the company. Anusha Investments Ltd is a wholly-owned subsidiary of Sundaram Clayton. The company also divested its brakes business to WABCO-TVS in 2007 with a view to focusing more on castings and other non-brake parts. Like other auto parts suppliers, Sundaram Clayton was also badly hit by the economic slowdown in 2008, and as a result the company deferred its plans to invest INR300m (USD5.9m, 26 February 2009) at Oragadam, near Chennai and an INR350m (USD7m) plant at Biwadi, Rajasthan, both in India. However, after winning contracts from Daimler (India and EU), Nokia Siemens, Cummins, Volvo, TVS Motor, WABCO-TVS, Hyundai, Honda and Ford, in September 2010 the company decided to invest INR400m (USD8.7m, 24 September 2010) in the construction of a greenfield facility at Oragadam, Chennai (India). In 2010 the company set an ambitious plan to invest a total of INR1bn (USD22.2m, 31 March 2010) in its various projects by 2012. Sundaram Clayton is focusing on acquisitions strategy and announced in January 2010 that it had received the directors approval acquire up to 19.5% of the equity share capital of Die Tech India based in Chennai, Tamil Nadu (India). The company supplies moulds and dies. In December 2011, Sundaram Clayton started trial production of magnesium die-castings at its plant in Padi, Chennai (India). The expansion into production of magnesium die-castings signifies the companys intention to focus on producing lightweight components. The company is also planning to open up a plant oustide India to serve rising demand from customers. The company derives around 30% of its total sales from exports, so setting up a plant outside India makes sense for the company. The move will also help the company optimise logistics cost. Acquisitions In January 2010, Sundaram Clayton received approval from its board of directors to make an investment up to INR22.5m (USD480,050, 31 March
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2010) to acquire up to 19.5% of the equity share capital of Die Tech India Pvt. Ltd., Chennai, a supplier of moulds and dies. Investments In September 2010, Sundaram Clayton announced plans to invest INR400m (USD8.7m, 24 September 2010) in the construction of a greenfield facility at Oragadam, Chennai (India). The facility will manufacture heavy truck parts and other automotive components including pipes, brackets and aluminium die-casting. The plant is expected to start production in financial year (FY)2012. The company is investing INR850m (USD18.9m, 30 September 2010) in the plant which is expected to have annual capacity of 12,000 tonnes of aluminium die-casting. In 2009, Sundaram Clayton set up a plant at Mahindra World City, Chennai (India) to manufacture automotive die components for export. The company plans to expand the capacity from 35,000 tonnes per annum to 50,000 tonnes in a year. The company decided to invest INR400m (USD8.8m, 31 March 2010) in the plant which will serve customers including ZF and Daimler. During the financial year 2006, Sundaram Clayton proposed an investment of INR 430m (USD9.8m, 31 March 2005) for its brakes business and INR930m (USD21.2m ) for its die-casting business. Divestments In 2007, Sundaram Clayton announced that the brakes division was spunoff into a separate company Wabco-TVS Ltd. The step was taken to allow Sundaram to focus on its core business area of castings. Certifications Sundaram Clayton was awarded the Deming prize in 1998 and the Japan Quality Medal in 2002. The Chennai based die-casting facility of Sundaram Clayton is ISO 9001 and ISO 14001 certified. The company also has a test track at the Chennai plant which has been certified by MIRA and TUV. Infrastructure Sundaram Claytons has in-house infrastructure for high-pressure diecasting, low-pressure die-casting and gravity die-casting. Sundaram Clayton is the only company in India with a 2,500 tonne pressure die-casting machine installed. The company has a team of 50 development engineers. Research and development Sundaram spent INR12.5m (USD275.340m, 31 March 2011) or 0.75% of its total FY2011 sales on research and development in the financial year ended 31 March 2011. Financial Overview In the financial year ended 31 March 2011, Sundaram Clayton posted sales of INR8.2bn (USD182.6, 31 March 2011), marking a 54.7% increase year-on-year (y/y) basis compared with sales of INR5.3bn (USD119.8, 31 March 2010) for the same period in the previous year. The profit before tax for the period went up substantially from INR137m (USD3m) to INR453m (USD9.9m), while profit after tax increased around 200% to INR373m (USD8.2m), against INR124m (USD2.7m) in FY2010. The company generated INR2.8bn (USD61.6m) from exports in FY2011, marking a 64.7% increase year-on-year (y/y) compared with INR1.7bn (USD37.7m) for the same period in the previous year. Segment wise, Automotive components posted sales of INR12.6bn (USD277.5m), up 13.5% from INR11.1bn (USD246.5m). The segments result before interest and tax increased from INR374.5m (USD8.3m) to INR657.3m (USD14.4m) in FY2011. Year 2011 2010 2009 2008 Sales, (INRm) 8,294 5,390 5,287 4,614 Profit Before Tax, (INRm) 453 137 70 354 Net Profit, (INRm) 373 124 63 239
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2007 Year 2011 2010 2009 2008 2007
8,648 Sales(USDm) 182.6 119.8 101.3 115.6 199.5
1,281 Profit before tax (PBT) (USDm) 9.9 3 1.3 8.8 29.5
916 Profit profit (USDm) 8.2 2.7 1.2 5.9 21.1
Outlook The projected growth of the car segment in the domestic market and its projected export programme is likely to benefit the growth of Sundaram Claytons aluminium casting business. The company has secured some new contracts in FY2010 and considering this, the company expects to generate sales of INR3.75bn (USD82.2m, 24 September 2010) by 2015. The company had set a target of INR10bn (USD219.2m) for 2012. SCL has reached the global quality levels which are validated by the Deming Quality Award and Japan Quality Medal. Measures undertaken by Sundaram Clayton such as divestment of its braking business, plans to create a separate subsidiary for non-auto parts business and open a greenfield facility in Oragadam, Chennai (India) will help the company secure new contracts and at the same time contribute positively to its sales.
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Sundram Fasteners
Fasteners, cold extrusions, hot forged parts
Address Sundram Fasteners Ltd 98-A, Seventh Floor Dr Radhakrishnan Salai Mylapore Chennai 600 004 Tamil Nadu India
Sundram Fasteners is a major supplier of automotive components including high tensile fasteners, cold extruded parts, powder metal parts, gear shifters and hot forged parts. The company is one of the fastest growing suppliers in India with operations in overseas markets as well.
Sundram Fasteners Limited (SFL) is part of the USD6bn TVS Group, Indias leading automotive supplier group. The company has diversified beyond fasteners to pumps, extrusions and forgings as a result of its acquisitions in India and Europe. The company operates 12 manufacturing facilities in India and one each in China, Germany, Malaysia and the UK. Of the 12 facilities in India, the company operates nine in Tamil Nadu and one each in Andhra Pradesh, Puducherry and Uttarakhand. In addition, Sundram Fasteners operates a joint-venture, Sundram Bleistahl Private Ltd, with Germany-based Bleistahl Produktions. The JV manufactures valve seats and guides at its manufacturing plant in Hosur, Tamil Nadu (India) Outside India, Sundram Fasteners operates five subsidiaries: Sundram Fasteners (Zhejiang) Limited: operates a manufacturing plant in Haiyan, Jiaxin city, Zhejiang (China) which produces high tensile fasteners. The Chinese subsidiary exports fasteners produced at the facility to its European customers. Cramlington Precision Forge Limited (CPFL): is a wholly-owned subsidiary of Sundram Fasteners with a manufacturing facility in Cramlington, Northumberland (UK). CPFL produces precision forged components for heavy vehicles for highway and off- highway applications. Sundaram RBI Autoparts Sdn Bdh: is a Malaysia-based subsidiary engaged in the production of oil and water pumps for Proton. Sundram Fasteners holds a 70% stake in the JV and plans to use it as a base to expand in the ASEAN region. Peiner Umformtechnik GmbH: Sundram Fasteners most recent acquisition, Peiner, supplies fasteners to automotive and construction sectors. Sundram International Inc: is a sales and warehouse subsidiary located in Troy, Michigan (US). Sundram Fasteners supplies to nearly all the major OEMs in India including Ashok Leyland, Bajaj Auto, Bajaj Tempo, Fiat, Ford, GM, Hero MotoCorp, Hindustan Motors, Kinetic Engineering, Mahindra & Mahindra, Maruti Suzuki, Tata Motors, TVS Motor and Yamaha. Apart from OEMs, the company also supplies to Bharat Forge, Brakes India, Delphi-TVS, Gabriel, Kalyani Brakes, Munjal Showa, Rane TRW, Tata Johnson Controls and Toyo Radiators. Internationally, Sundram Fasteners customers are ASC, Case New Holland, Caterpillar, Chrysler, Cummins, Daimler, Deutz, Dura, Deere & Co, Delphi, Deutz, GM, Holden, Holset, Iveco, John Deere, Kenworth, Komatsu, Mack, Meritor, MTU, MG Rover, Mitsubishi, Perkins, Proton, Valeo, Volvo and ZF. Recent Developments Corporate strategy In the past few years Sundram Fasteners has increasingly targeted supply opportunities in China, Germany, Malaysia and the UK where the company expanded presence recently through acquisitions. The company plans to leverage its global base by manufacturing components in low cost destinations such as India and China and exporting them to the mature markets through its subsidiaries in Germany and the UK. Meanwhile, Sundram Fasteners is also ramping up capacity in India to meet expected surge in the domestic demand. In the financial year 2011, the 411
Tel: +91 44 284 78 500 Fax: +91 44 284 78 508/510 Internet: http://www.sundram.com
Senior Officers Suresh Krishna, Chairman and Managing Director Arathi Krishna, Joint Managing Director Arundhati Krishna, Whole-time Director Sampathkumar Moorthy, Executive Director and President V. G. Jaganathan, Executive Director and Secretary Products Belt tensioners, cold extruded parts, damper pulleys, electrical fuel pumps, feed pumps, gears, gear shifters, wheel & under-carriage and chassis fasteners, high tensile fasteners, hot forged parts, iron powder, mechanical fuel pumps, oil pumps, powder metal parts, radiator caps, rocker arm assemblies, spare wheel carriers, water pumps Plants India: Andhra Pradesh, Puducherry, Tamil Nadu (9), Uttrakhand Outside India: China, Germany, Malaysia, UK Sales INR22.8bn (USD502.3m, 31 March 2011) (Year to 31.03.11) Employees Group: 1,800 (March 2011)
company spent INR1.35bn (USD29.7m, 31 March 2011) on capacity expansion. Sundram Fasteners intends to continue adding capacity in coming years as well. The company has earmarked INR1.5bn (USD33m) to further ramp up capacity in 2012. The company has significantly expanded its product mix with components like water pumps, oil pumps, extrusions and forgings. This has helped Sundram Fasteners to reduce its excessive dependence on the fasteners business. Meanwhile, Sundram Fasteners is working to leverage its expertise in fasteners to tap high growth potentials in non-automotive sectors. The company is setting up facilities at Mittamandagapet in Tamil Nadu (India) to manufacture fasteners for use in wind energy generators. This will enable the company to reduce its dependence on highly-volatile automotive business and explore additional sources of revenue. Joint-Venture In 2006, Sundram Fasteners started the operations of Sundram Bleistahl, joint-venture (JV) with Bleistahl Produktions GmbH & Co., (Germany) to manufacture valve train parts including valve guides and valve seat inserts in India. Sundram Fasteners holds 76% of the equity while the remainder vests with Bleistahl. Initial investment in the J V was INR90m (USD1.9m, 31 October 2004) with further plans to invest INR500m (USD10.9m). Bleistahl transferred part of its production facilities from Germany to India and provided the technology. Most of the production is earmarked for exports.
New Product Development: Sundram Fasteners spent INR85.7m
(USD1.9m) on research and development (R&D) in the financial year ended 31 March 2011, up 9.2% over INR78m (INR1.7m) in the preceding year. The company spends nearly 0.5% of its sales on R&D. Sundram Fasteners entered into a technical agreement with Hitachi for production of tappets. The company fully absorbed the technology and manufactures tappets at its Hosur plant in Tamil Nadu (India). Sundram Fasteners developed high-temperature vacuum sintering of power metal parts. The company also developed pre-alloyed steel powder.
Financial Overview In the financial year ended 31 March 2011, Sundram Fasteners posted consolidated net sales of INR22.8bn (USD502.3m, 31 March 2011), an increase of 3 3 . 6 % compared with INR16.9bn (USD376.4m, 31 March 2010) in 2010. The companys domestic sales during the financial year increased 37.5% to INR16bn (USD351.7m) while its exports surged 44.9% to INR6.8bn (USD150.6m).
Strong growth in sales and exports led Sundram Fasteners to record sharp increase in earnings during the year. The company almost doubled its profit before tax (PBT) during the financial year to INR1.5bn (USD34.3m) compared with INR792.2m (USD17.6m) in the previous year. The company concluded the financial year with net profit of INR1.1bn (USD25.1m), more than double the INR476.4m (USD10.6m) in 2010. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 22,804.3 16,948.1 17,972.4 16,262.6 15,693.5 Net Sales (USDm) 502.3 376.4 344.5 407.6 361.2 Profit Before Tax (INRm) 1,557.7 792.2 384.9 1,105.2 1,116.7 Profit Before Tax (USDm) 34.3 17.6 7.4 27.7 25.7 Net Profit (INRm) 1,138.8 476.4 309.3 724.5 707.7 Net Profit (USDm) 25.1 10.6 5.9 18.1 16.3
Outlook Despite moderation in vehicle demand in India since the beginning of financial year 2012, Sundram Fasteners continues with its capacity expansion plans. The company is preparing for the next phase of the growth of the Indian automotive industry.
Sundaram Fasteners faced sharp increase in input costs during financial year 2011. Raw material prices remained high throughout the financial year. The company witnessed a sharp increase in expenses on power amid nonavailability of power due to scheduled power cuts up to 30% and frequent unscheduled power outages which forced it to purchase power at higher costs. In addition, the companys operating expenses also increased due to rise in wages and freight costs. The company tried to control operating expenses through adopting new techniques such as total productive maintenance (TPM) across its facilities. The companys decision to diversify its presence in the non-automotive segment is a move in the right direction. Sundram Fasteners is not diversifying into completely new business but is working to leverage its expertise in fasteners to non-automotive segments. The company expects strong growth in demand for fasteners in wind energy industry. This is expected to provide the company with an additional source of revenue and balance its business portfolio in the medium to long term.
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Suprajit Engineering
Automotive cables and gauges
Address Suprajit Engineering Limited No.100, Bommasandra Indl. Area, Bangalore 560 099 India Tel: +91 80 4342 1100 Fax: +91 80 783 3279 Website: http://www.suprajit.com Senior Officers Ajith Rai, Chairman & Managing Director C Mohan, President Narayan Shankar, Executive Vice-President Medappa Gowda, Vice-President, Finance Eshwaran, General Manager, Projects Sushanth Jain, General Manager, North Narahari Rao, General manager, New Product Development Nagaraj Rao, General manager, Suprajit Automotive Products Cables for tire lifting, , clutch cables, complete brake assemblies with equalisers, door latch cables, fuel filter cables, fuel lid cable assemblies, fuel & tailgate assemblies, gear shift mechanisms, hood lock & release cables, mirror cables, park brake cables, push-pull cables, seat belt cables, seat recliner cables, speedometer cables, starter cables, tail gate cables, tachometer cables, throttle cables, tyre lock cables, window regulator cables Plants India (12) Sales INR2.9bn (USD63.8m, 31 March 2011)
Suprajit Engineering Limited (SEL) caters to a wide spectrum of automotive and non-automotive control cable requirements. It is India's largest manufacturer of automotive cables. It supplies the two-wheeler, passenger car, tractor and commercial vehicle segments.
SEL operates twelve plants India, of which four are located in Bangalore, Karnataka and one each in Mansear, Gurgaon; Chakan, Pune; Vapi, Gujarat; Pantnagar, Uttrakhand; Haridwar, Uttrakhand and Sanand, Gujarat. SELs customers consist of Ashok Leyland, Behr India, Benteler, BMW, Brose, Force, Ford, Fiat, Edscha, GM, Hyundai , IFB Automotive Seating, Inteva, Lear India, Magna, Mahindra & Mahindra, Maruti Udyog, Meritor, Nissan, Opel, SAAB, Tata Motors, Vauxhaull, Valeo and Volkswagen.
Corporate strategy SEL intends to expand its array of investment activities with a view to strengthening its domestic presence. The company has undertaken expasnion considering a rapid increase in the demand for cables. For instance, the automotive cable plant started construction of a plant in Chakan, Pune (India) and in Bangalore, Karnataka (India). SEL has secured some new contracts from existing as well as new customers which has prompted the company to ramp up production. These include BMW, Volkswagen, Nissan, Brose, John Deere. In financial year (FY) 2012, the company plans to manufacture 150 million cables, compared to the 100 million in FY2011. The company aims to achieve this level by setting up more plants and expanding the capacity of the existing ones. In 2010, SEL acquired an industrial area at Pathredi in Rajasthan and started trial production at its facility in Haridwar, Uttrakhand (India). SEL also opened a new facility in Doddaballapur to undertake production of new products and capacity expansions. SEL also intends to set up a plant in Sanand, Gujarat (India) where it has acquired land to supply Tata Nano. The company supplied components to Nano from its Vapi, Gujarat plant which is 250km away from Sanand. However, as the sales of Nano are increasing, the company plans to set up a plant in Sanand. This will help the company optimise the logistics cost. As well as these measures, SEL is looking to expand its product portfolio and mark its entry into manufacturing of plastic moulded body parts, extrusion products, tank units among other value added synthetic or plastics based components. Further, the companys wholly owned subsidiary Gills Cables Limited changed its name to Suprajit Europe Limited. The move will allow the company to shift production from Europe to India, thereby helping it reduce cost of production. Acquisitions In April 2006, SEL acquired CTP Gils Cables, a UK based automotive cable manufacturer from Carclo PLC. The company also acquired its 50% stake in CTP Suprajit Automotive Pvt. Ltd paying GBP2.2m (USD4m, 30 April 2006) for the acquisition. The joint-venture has since been renamed Suprajit Automotive Private Ltd and manages export oriented production. Joint-ventures In 2007, SEL signed a 70:30 joint-venture with Jiang Yin Yuan Feng Communications Equipments Co, China to produce automotive cables in China.
Recent Developments
Employees
c.700 (2008)
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In 2007, SEL signed an agreement with Michang Cable Company (Korea) for logistics management in the respective countries for future projects.
Investments In December 2011, Suprajit Automotive, a subsidiary of Suprajit Engineering opened a cables plant in Bangalore (India). The plant is expected to start production by the end of 2012. In December 2011, SEL opened a plant in Doddaballapur, Bangalore (India) which will manufacture new products currently under development stage. In October 2010, SEL acquired a two-acre industrial site in Bommasandra Industrial Area in Bangalore, Karnataka (India) to produce cables. The plant has extra space to expand. In October 2010, SEL held a ground-breaking ceremony at a cable plant for foyr-wheelers in Chakan, Pune (India). In January 2010, SEL started trial production at its facility in Haridwar (India). The company invested INR100m (USD2.1m, 31 January 2010) in the facility which has capacity to manufacture five to six million cables in a year. In October 2010, SEL opened a new facility in Doddaballapur to undertake production of new products and capacity expansions. In April 2007, Suprajit commissioned its cable manufacturing facility at Pantnagar (Uttaranchal). In 2007, Suprajit commissioned its cable manufacturing facility at its second plant at Manesar (Haryana). Divestments In 2007, SEL transferred high volume production from Gills Cables, UK to its Bangalore based export oriented unit. Minor assembly operations have been shifted to a new location in UK. Research and development SEL incurred INR8m (USD176,220, 31 March 2011) on research and development in FY2011, marking a 5.2% jump compared with an expenditure of INR7.6m (USD168,780, 31 March 2010) in FY2010. Suprajit Automotive has development centres in Bangalore, Karnataka; Manesar, Gurgaon; Chakan, Pune (India). Certifications Four units of SEL have been accredited with TS 16949 status. Additonally, SELs Manesar (Haryana, India) unit is certified with ISO14000 and ISO 18000 status. Financial Overview For the financial-year ended 31 March 2011, SEL reported a 50% increase in sales to INR2.9bn (USD63.8m, 31 March 2011) compared with sales of INR2bn (USD44.4m, 31 March 2011) for the same period in the corresponding year. Of the total sales, INR2.8bn (USD6.1m) was derived from the domestic market and the remaining INR127m (USD2.8m) from international markets. The company saw a 40% increase in domestic sales compared with INR2bn (USD44m) in FY2010 and 60.1% increase in international sales. Profit before tax for the period went up from INR426.4m (USD9.4m) to INR320.6m (USD7m), marking a 33% jump year-on-year (y/y) basis, while profit after tax moved up 39.7% from INR218.1m (USD2.3m) to INR304.9m (USD3.6m). Year 2011 2010 2009 2008 2007 Net sales (INRm) 2,989.9 2,070.6 1,854.3 1,594.1 1,531.7 Profit before tax (INRm) 426.4 320.6 180.8 101.5 182.5 Net Profit (INRm) 304.9 218.1 116.2 48.8 124.8
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Year
Net sales (USDm) 65.8 45.9 35.5 39.9 35.2
Profit before tax (USDm)
Net Profit (USDm) 6.7 4.8 2.2 1.2 2.8
2011 2010 2009 2008 2007
9.3 7.1 3.4 2.5 4.2
Outlook SEL continues to win new business from a diverse group of customers which includes contracts from BMW, Volkswagen and Nissan. The company which experienced around 50% sales growth in the fiscal year 2011 is expected to post a further increase in sales backed by new contracts secured in 2010. Considering the series of investments undertaken in 2010, SEL is well set to acieve its sales traget. The sales growth is further anticipated from the exports sector. With major automakers establishing their presence in India, the companys move to ramp up its production is a step in the right direction. This might further help the company to win more business orders from new customers. SELs product focus is likely to reinforce its growth, especially with the decision to add plastic moulded products to its product offerings. The new product will help the company expand its business, considering the weight reduction benefit it offers. The Indian automotive suppliers witness potential growth opportunities from outsourcing by OEMs and tier one suppliers overseas. SEL has made significant headway in this regard. Cables, being a high production cost, low technology product area, make it viable to produce in low-cost countries. Hence, exports of cable from India are a high potential area for SEL. The company's decision to scale up its global operations has helped SEL to reduce its dependence on the domestic two-wheeler business.
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Talbros Automotive
Gaskets, stampings & rubber, forging
Talbros Automotive Components Limited (TACL) is the flagship company of the Talbros Group. The company is a major supplier of gaskets, forgings, stamping and rubber.
Talbros Automotive Components Limited was established in 1956 by the Talwar Brothers in collaboration with former Coopers Payen, now FederalMogul Sealing Systems, a subsidiary of the US-based Federal Mogul, to produce automotive and industrial gaskets in India. Over the years the company has diversified its product lines and has become a major supplier of gaskets, forgings, rubber products, stampings, steering and suspension components. The company operates 12 manufacturing facilities, spread across six product lines. In addition to Talbros Automotive Component, the Talbros Group operates two major subsidiaries. QH Talbros: is a joint-venture with Quinton Hazell Automotive. QH Talbros manufactures tie rod ends, ball suspension joints, rack ends, drag links, centrelink assembly, stabiliser joints and complete steering linkage assembly. The company operates five manufacturing plants and employs 1,200 people. TACL holds an 8% stake in the company. Nippon Leakless Talbros: is a joint-venture between Tabros Automotive Components and Nippon Leakless Corporation Japan. The JV produces gaskets primarily for two-wheeler manufacturers. Address Talbros Automotive Components Limited 400, Udyog Vihar, Phase - III Gurgaon - 122 016 Haryana India Tel: +91 124 400 2963 Fax: +91 124 243 9222 Website: http://www.talbros.com Senior Officers Naresh Talwar, Chairman Umesh Talwar, Vice Chairman and Managing Director RP Grover, CFO, Vice-President, Finance & Investor Relations. K Sairam, COO Varun Talwar, Joint Managing Director, CEO, Forgings division Mahender Chandiramani, President, Forging division Products Back plates for braking systems, bellows, conversion kits, cylinder head gaskets, drag rod assemblies, connecting rods, dust covers, edge moulded gaskets, engine overhaul kits, engine mounts, exhaust manifold gaskets, gear blanks, heat shields, inner and outer ball joints, multi layer steel gaskets, rubber moulded gaskets, rubber pads, secondary gaskets, sheet metals, shims & washers, stabiliser link assemblies, steel elastomer gaskets, silent block bushes, steering linkage assemblies, suspension ball joints, suspension control arms, suspension kits, stabiliser bushes, tie rod assemblies, torque rods, tyre sealant, welded sheet metal sub-assemblies, V-frames, Plants India (7): Haryana (4), Maharashtra, Tamil Nadu, Uttrakhand Sales INR3.2bn (USD70.4m, 31 March 2011) Employees 850 (31 March 2007)
The company has also forged several partnerships and its major partners, including Ahlstrom Altenkirchen (Germany), Federal-Mogul (US), Affinia Group (US) Sanwa Packaging Industry Company (Japan) and Presswerk Krefeld (Germany). Most recently the company entered into a JV with Sistemi Sospensioni, a subsidiary of Magneti Marelli. The company enjoys a broad customer base which includes manufacturers of two-wheelers, passenger and commercial vehicles. Talbros primary customers include Ashok Leyland, Bajaj Auto, Cummins, Eicher, Escorts, Force Motors, GM, Hero MotoCorp, Honda, Hyundai, John Deere, Mahindra & Mahindra, Maruti Suzuki, Suzuki, TAFE, Tata Motors and Tata Cummins. In addition, the company supplies to some global tier one suppliers such as Meritor (USA), Carraro (Italy), Quinton Hazell Automotives (UK) and Saipa Group (Iran). Recent Development Corporate strategy Talbros has embarked on an ambitious growth plan which involves addition of new products, technologies and processes. The company aims to achieve this objective through entering into strategic alliances with global suppliers. In November 2011, Talbros formed a jointventure with Sistemi Sospensioni, a subsidiary of Magneti Marelli to manufacture suspension systems and modules. The company intends to transfer its existing stamping business to this joint-venture while Magneti Marelli will provide its design and technology expertise to the venture. Earlier the company entered into a technical assistance agreement with Sanwa Packaging Industry Company based in Japan to manufacture heat shields for automotive and related applications. The company expects there is high growth potentials of heat shields in India. Talbros is looking to expand capacity and plans to set up plants in Chennai, Tamil Nadu and in Jaipur, Rajasthan (India). In addition the company is upgrading its present gasket manufacturing facilities to improve its product mix. The company is working with consultants including Eicher Technologies to restructure its Faridabad gasket plant to reduce throughput time, work in progress and material movement. In addition, the company participated in Advanced Cluster Programme of ACMA Centre of Technology (ACT), which focuses on adopting latest technology in manufacturing.
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Talbros had been successfully adding new customers in gasket business division with the inclusion of automakers and major tier one suppliers such as Kirloskar Oil Engines, Mahle and Volvo Eicher. In the stamping & rubber division, the new contracts won include Denso India and Rane TRW. Acquisitions In 2007, Talbros acquired sheet metal components business of XO Stampings. XO Stampings was a tier two vendor to Tata Motors and Maruti Suzuki. Joint-ventures In November 2011, Talbros entered into a 50:50 joint-venture agreement with Sistemi Sospensioni S.p.A, a subsidiary of Magneti Marelli, to supply suspension systems and modules for the Indian market. Under the agreement, Talbros will transfer its exisitng stamping business to the JV, after obtaining its shareholder approval. It will commence operations from the Indian partners facility in Faridabad, Haryana (India) will manufacture various components including control arms, knuckles, front axles and rear axles for automotive applications. The JV is expected to become operational by April 2012. In December 2009, Talbros entered into a technical assistance agreement with Sanwa Packaging Industry Company based in Japan to manufacture heat shields for automotive and related applications. In January 2009, Talbros entered into a licence agreement with Ahlstrom Altenkirchen GmbH (Germany) to obtain technical know-how to manufacture non-asbestos beater addition jointing, one of the raw materials required for manufacturing gaskets, conforming to international standards. The two partners also signed a supply agreement whereby Ahlstrom will buy back a portion of Non-asbestos Beater Addition gasket material/ composite material produced by the company at its plant in Sohna, near Gurgaon, Haryana (India). Investments In April 2010, Talbros established its fourth gasket manufacturing plant in Sitargunj, Uttarakhand (India). The plant, located in special economic zone (SEZ), will enjoy exemption from excise duty and income tax. The companys other gasket manufacturing plants are located in Faridabad, Haryana, Pune, Maharashtra and Chennai, Tamil Nadu. Further details including capacity of the fourth plant were not disclosed. In 2007, Talbros announced a greenfield sheet metal unit in Lucknow, Uttar Pradesh (India) for supplies to Tata Motors. In 2007, Talbros announced the expansion and relocation of the stamping business acquired from XO Stampings. XOs product range was widened, quality improved and facilities upgraded at a cost of INR60m (USD1.3m, 31 March 2007). In 2007, Talbros joint-venture with Nippon Leakless announced a greenfield facility at Hero Honda Vendor Park at Haridwar. TACL made an investment of INR30m (USD690,580, 31 March 2007). In 2007, Talbros announced a facility at Faridabad, Haryana (India) for the production of automotive dust covers and bushes at a cost of INR31m (USD713,600, 31 March 2007). In 2007, Talbros announced an expansion and technology upgrade at its Faridabad, Haryana and Pune, Maharashtra (both in India) based gasket manufacturing units at a capital consideration of INR70m (USD1.6m, 31 March 2007). In January 2007, Talbros commissioned a new 8,000-ton per annum forging facility at Bawal, Haryana, (India) for supplies to QH Talbros and other customers. Around 35% capacity is earmarked for exports. Talbros plans to extend its forging capabilities to fully machined forgings. Research and Development Talbros spent INR9.6m (USD211,460, 31 March 2011) on research and development. This was equivalent to 0.33% of its sales in the financial year ended 31 March 2011. Contracts In 2009, Talbros supplies met control for Maruti Suzukis New Wagon R. Talbros is the single source supplier of gaskets to Honda Motorcycle & Scooters India. Talbros supplies single source to Honda Siel India and Honda Power
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Products. Talbros supplies gaskets to the GM Chevrolet Tavera programme. Talbros is the single source supplier of gaskets to Tata Cummins.
Certifications Talbros has been accredited with ISO 14001 and TS 16949 certifications.
Financial Overview For the financial year ended 31 March 2011, Talbros Automotive Components posted a 29.1% increase in consolidated net sales to INR3.2bn (USD70.9m, 31 March 2011) compared with INR2.5bn for the same period in the previous year. The strong topline growth led Talbros to report significant increase in earnings during the financial year. The company reported profit before tax (PBT) of INR139.7m (USD3.1m), up 45.4% compared with INR96.1m (USD2.1m) in the previous financial year. The company concluded the financial year with net profit of INR125.9m (USD2.8m) reporting an increase of 43.7% over INR87.6m (USD1.9m) a year earlier. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 3,219.4 2,493.9 2,067.9 1,876.0 1,684.4 Net Sales (USDm) 70.9 55.4 39.6 47.0 38.8 Profit Before Tax (INRm) 139.7 96.1 45.2 116.1 92.9 Profit Before Tax (USDm) 3.1 2.1 0.9 2.9 2.1 Net Profit (INRm) 125.9 87.6 6.4 88.4 94.7 Net Profit (USDm) 2.8 1.9 0.1 2.2 2.2
Outlook Talbros is diversifying into new business areas through entering into strategic partnership with the global suppliers. This is expected to both increase the companys avenues of sales and reduce its dependence on any particular product segment. In addition the company is ramping up capacity of its existing business lines despite some moderation in demand in India. Through going ahead with its capacity expansion plans, the company is getting ready for the next growth phase in the Indian automotive industry. Talbros Automotive stands to benefit from the joint-venture with Magneti Marelli as it will gain access to the latters know-how about the entire range of suspension components and modules, and hence will be able to offer advanced lightweight components to Indian automakers, complying with required emission standards.
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Tata AutoComp
Diversified automotive supplier
Address Tata AutoComp Systems Ltd TACO House Damle Path Off. Law College Road, Erandwane Pune 411 004 Maharashtra India Tel: +91 20 6608 5000 Fax: +91 20 6608 5034/5102 Internet: www.tacogroup.com Senior Officers R. Gopalakrishnan, Chairman R S Thakur, Managing Director & CEO Amitabha Mukhopadhyay, President and CFO Rajiv Bakshi, President and Head Business Group A Arvind Goel, President and Head Business Group B Ajay Tandon, President and Head Business Group C Products Automotive batteries, command and control cables, interior and exterior plastic products, kinematic plastic parts, large SMC parts, radiators and inter coolers, rear-view mirrors, seating systems, sheet metal components, suspension systems for commercial vehicles, wiring harnesses Plants India: 47 plant Outside India: China Sales Group: c. INR28.5bn (USD627.9m, 31 March 2011) (Year to 31.03.11) Employees Group: 13,000 (2011)
Tata Autocomp (TACO) is part of the diversified Tata Group. The company supplies a variety of components, assemblies and aggregates to OEMs and other customers primarily based in India.
Tata AutoComp Systems (TACO) was incorporated by four companies of the Tata Group Tata Industries (owns 35% of the company), Tata Motors (26%), Tata Capital (24%) and Tata Sons (14%). The company operates through its subsidiaries and joint-ventures. TACO has nine global partners and seven jointventures (JVs). TACO operates 44 plants and five wholly-owned companies in India. Broadly, TACO activities are divided into three Strategic Business Units (SBUs) Products, Supply Chain Management (SCM) and Engineering. TACO Product SBUs is engaged in production of various automotive components and systems such as interior and exterior plastic products, kinematic parts, automotive batteries, seating systems, radiators and inter coolers, wiring harnesses, rear view mirrors, command and control cables, suspension systems for commercial vehicles and sheet moulding components. TACOs Product SBUs are structured into the following companies: TACO Interior and Exterior Plastic Division (IPD): is a wholly-owned subsidiary of TACO engaged in the production of exterior products such as bumpers, body side mouldings, spoilers, grilles, spare wheel covers and footsteps; and interior products such as cockpit assembly, injection moulded plastic components and assemblies, dashboards, instrument panel, air vents, door trims, A, B, C, pillars, interior trims, central consoles, floor consoles, grab handles and door pulls. The subsidiary operates seven manufacturing plants in India and one in China. TACO GY Batteries: a JV with Japan-based GS Yuasa for automotive lead acid storage batteries. The JV operates a manufacturing plant in Ranjangaon, near Pune, Maharashtra (India). The plant has annual production capacity of 500,000 units. The JV sells batteries under the brand name Tata Green Batteries. Tata Johnson Controls: is a JV with the US-based Johnson Controls to supply seating systems and components like foam, head rests, armrests and seat trims. The JV operates eight seat manufacturing plants in India with two plants in Pune and one in Aurangabad, Maharashtra; one each in Lucknow and Noida, Uttar Pradesh; and one each in Chennai, Tamil Nadu; Jamshedpur , Jharkhand and Rudrapur, Uttarakhand. Tata Toyo Rad: is a JV with Japan-based T. Rad to produce radiators, intercoolers, heat cores, condensers, exhaust gas recirculation (EGR) coolers, oil coolers, fans and fan modules. The JV has an integrated manufacturing facility at Hinjewadi, Pune, Maharashtra (India). In addition, the JV operates assembly lines at Chennai, Tamil Nadu; Lucknow, Uttar Pradesh and Jamshedpur, Jharkhand for just-in-sequence (JIS) supply to Tata Motors and Ashok Leyland. Tata Yazaki: is a JV with Japan-based Yazaki Corporation which manufactures wiring harnesses for the automotive industry. The JV operates an integrated manufacturing plant near Pune, Maharashtra (India). Tata Ficosa: is a JV with Spain-based Ficosa to produce a diverse range of interior and exterior rear view mirrors. The JV operates a manufacturing plant in Hinjewadi, near Pune, Maharashtra (India). In addition, the JV manufactures various ranges of command and cables, gear shifters and washer systems for the automotive industry. TACO Hendrickson Suspension Systems: a JV with USA-based Hendrickson to produce suspension systems for commercial vehicles. The JV produces air suspension systems for front and rear, tandem bogie suspension and auxiliary axle systems. The JV operates a manufacturing facility in Khed, near Pune, Maharashtra (India).
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TACO Composites, previously known as Automotive Composite Systems International: started as a JV with Owens Corning (USA) for sheet moulded composites. Since March 2010, TACO Composites has become a wholly owned TACO subsidiary. Automotive Stampings and Assemblies: is 75% owned by TACO. The company manufactures sheet metal components, rear twist beams and welded assemblies. The company operates four manufacturing plants in India, of which, two are located in Pune, Maharashtra and one each in Halol, Gujarat and Pantnagar, Uttarakhand.
TACO Supply Chain Management (SCM) SBU, founded in 2001, is the companys services oriented division. TACO SCM is a single window supplier of automotive components to global customers. The SBU helps TACO customers to source components required by OEMs and provide related logistics services. SCM's key customers are BorgWarner, Husqvarna, US, Lotus and Honeywell-Europe. TACO Engineering SBU: TACO set up TACO Technical Centre in 1999 which provides end-to-end solutions for automotive domains like interior, exterior, electrical distribution systems, lighting, body in whicte (BIW) and powertrain. Tata Motors is the largest customer of TACO which accounted for about half of its total sales in financial year 2011. The automaker also owns a 26% stake in the company. Other significant customers of TACO include Ashok Leyland, GM India, Fiat India, Ford India, Honda Siel Cars, Mahindra & Mahindra, Toyota Kirloskar, and Volkswagen India. In addition, the company supplies to several global tier one suppliers including Behr, Cummins, Delphi, Faurecia, Ficosa, Gabriel, Honeywell Engineering, Johnson Controls, Magnetti Marelli, Textron, Valeo, Visteon and Yazaki. Recent Developments Corporate strategy TACO is focusing on expanding capacity, improving operational efficiency and expanding product portfolio by leveraging existing JV partners. The company has announced a series of expansions, which involve setting up new manufacturing facilities and expanding capacity at its existing facilities, to meet increased demand from its customers including Tata Motors. For example, in 2010, the company disclosed its plans to invest INR3bn to set up five manufacturing plants at its upcoming vendor park in Sanand to supply Tata Motors Nano plant. During the same year the company announced plans to establish seven plants in India including four in Jamshedpur, Jharkhand and two in Bangalore and one in Dhrawad, both in Karnataka. The company, which has grown within a relatively short time span due to several strategic joint-ventures, decided to exit from some JVs which lacked significant growth opportunities and those that were not part of its core competency. As a result TACO exited from loss-making German subsidiaries and Tata Visteon. The company also exited TC Springs, Knorr-Bremse, TACO Faurecia, TACO Sasken Automotive and TACO Mobility Telematics. At the same time the company consolidated presence in some JV through buying stake of its partners. This included Owen Cornings 26% in TACO Composites and Gestamps 37.5% in Automotive Stamping and Assemblies Limited. In 2011, TACO considered an option to raise USD245m through an initial public offering (IPO). The company had already filed papers with the Indian stock market regulator, Security Exchange Board of India (SEBI), for the proposed IPO. However, the company later backed out from the plan citing poor market conditions. Acquisitions In December 2010, TACO completed the acquisition of Gestamp's stake in Automotive Stampings and Assemblies Limited (ASAL) which took TACOs total holding to 75% thereby making ASAL a subsidiary of TACO. In January 2010, TACO acquired the outstanding 26% interest in Automotive Composite Systems International held by Owens Corning Inc. Following the acquisition TACO changed the name of the wholly-owned subsidiary to TACO Composites Limited (TACOCL).
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Joint-ventures In May 2011, Tata Toyo, a joint-venture between TACO and T. RAD, signed a memorandum of understanding (MOU) with Mitsubishi Metals to set up a research and development (R&D) centre in Pune, Maharashtra (India). The local R&D is expected to help the JV serve its customers better. The R&D will develop heat exchange technology in India, which currently come from outside the country, especially from Japan. In October 2008, one of TACOs joint-ventures Tata Johnson Controls Automotive Limited (TJCAL) entered into a joint-venture with Isringhausen GmbH & Co. KG (ISRI) and incorporated ISRI TJC Private Limited. The major product lines of ISRI TJC are mechanical and pneumatic suspension seating system for commercial vehicles. In March 2008, TACO and engineering services outsourcing firm INCAT entered into a strategic alliance to offer complete design and development service for global automotive manufacturers. Under the terms, INCAT provides vehicle level integration expertise, while TACO offers module integration for a full range of automotive components. In June 2006, TACO and Hendrickson International Corporation incorporated a JV company, Tata Hendrickson Suspensions Private Limited (THSPL) to manufacture automotive suspensions primarily for buses and trucks. The JV operates a manufacturing plant in Hinjewadi, near Pune, Maharashtra (India). In February 2006, TACO and GS Yuasa International entered into a 50:50 JV to form Tata AutoComp GY Batteries Pvt. Ltd. The JV manufactures batteries for OEMs and the retail market in India at its manufacturing facility near Pune, Maharashtra (India). Investments In October 2010, TACO announced plans to invest INR3bn (USD66.4m, 18 October 2010) to expand its operations in India. The company invested INR80m (USD1.7m) to establish two technology units in Pune (India) which began operations at end 2010. The units include Tata Yazaki, a wiring harness company, and Tata AutoComp GY Batteries, a jointventure (JV) with GS Yuasa for automotive and inverter batteries. In August 2010, TACO announced its plans to set up five manufacturing plants in Sanand, Gujarat (India) with an investment of INR3bn. The new plants are part of the vendor park near the Tata Motors Nano plant site in Sanand. The plant become operationall in 2011. In June 2010, TACO announced plans to set up seven manufacturing facilities in India. Of this total the company will establish four plants in Jamshedpur, Jharkhand, and two plants in Bangalore and one in Dharwad, in Karnataka. The company will invest INR1bn in setting up these new plants. In 2008, TACO invested in acquisition of land and building for its interiors and plastics division at Uttarakhand for a project of Tata Motors Limited pertaining to a low weight carrier. In October 2007, TACO announced it would set up a passenger car airbag testing facility in partnership with Canada's Microsys Technologies at TACOs facility in Pune. The manufacturing facility became operational in December 2007. In August 2007, TACO subsidiary Automotive Stampings and Assemblies Limited announced plans to set up its fourth manufacturing plant in Pant Nagar Uttarakhand (India) with an estimated cost of INR481m. The plant became operational in May 2008. It primarily caters to Tata Motors. Divestments In December 2010, TACO sold its entire stake held in Tata AutoComp Mobility Telematics Limited to a US-based firm, Trimble. The financial details of the divestment were not disclosed. In 2010, TACO divested its stake in Knorr Bremse Systems for Commercial Vehicles (India) Private Limited. In 2009, TACO exited its plastics business in Germany, through the closure of its subsidiaries TACO Kunstsofftecknik GmbH and TACO Grundstckverwaltungs GmbH In 2009, TACO exited its electronics joint-venture with Sasken Automotive, through the sale of its subsidiary TACO Sasken Automotive Electronics Limited. In 2009, TACO divested its stake in Taco Faurecia Design Center Private Limited.
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In September 2006, TACO sold its 50% stake in a joint-venture with Japan's Yutaka Giken Co., which was formed in early 2001. The JV supplied exhaust systems and disc brakes for cars and two wheelers, mainly to Honda subsidiaries in India, from a facility located near Pune (India). Total value of the transaction was not disclosed by the company.
Contracts In 2010, the launch of the Vista and Manza cars by Tata Motors provided TACO with several contracts to supply automotive components. The purchase orders received by the company with respect to these two programmes had a significant impact on its total income during the year. In financial year 2011, TACO supplied components to a series of new launches Tata Nano, Aria and Ace; Toyota Etios and Liva; Ford Figo; Volkswagen Polo and Vento; GM Beat. New Product Development TACOs strategy is to build its competence in application engineering, product design and knowledge-based processes. It sources technology and products from its joint-venture partners rather than investing in original R&D. In October 2010, TACO showcased advanced technologies for automotive applications on the occasion of the company's 15th anniversary. The products unveiled included high-end seating systems, interior parts, sheet metal components, parts made of composites, radiator designs and solutions for hybrid and electric vehicles. The TACO Engineering Centre (TACOE) provides design, development, prototyping, testing and validation services to TACO customers for product design and engineering. In May 2011 TACO's JV with T. Rad, Tata Toyo, signed a memorandum of understanding (MOU) with Mitsubishi Metals to set up a research and development (R&D) centre in Pune, Maharashtra (India). The local R&D is expected to help the JV serve its customers better. The R&D will develop heat exchange technology in India, which currently comes from outside the country, especially from Japan. Financial Overview In the financial year ended 31 March 2011 TACO reported a 19.5% increase in net sales to INR28.3bn (USD623.6m, 31 March 2011) compared with INR23.7bn (USD526m) in the previous year. The company benefited from strong growth of the Indian automotive industry during the financial year. Higher sales led the company to report 15.9% increase in profit before interest and tax (PBIT) to INR2.4bn (USD52.9m) compared with INR2.1bn (USD46m) in the previous financial year. TACO recorded profit before tax (PBT) of INR185.1bn (USD4.1m) over INR140m (USD3.1m) in 2010. The company concluded the financial year with net profit of INR122.1bn (USD3.1m) compared with INR89.3m (USD2m) in the previous financial year. TACO is privately owned by Tata Group companies Tata Sons, Tata Motors, Tata Industries and Tata Capital. Therefore the company is not obliged to publish detailed financial results. Outlook TACO started operations initially to supply parts to the ambitious Indica small car project of sister concern Tata Motors. For this purpose, it set up 13 joint-ventures with global majors for the manufacture of components required for passenger cars. This move allowed TACO to access and build competence in modern technology of automotive parts without allocating excessive resources in the project. Today the company not only supplies to Tata Motors but also to most of the automakers who have manufacturing presence in the countries. The company gradually developed an efficient business model built around its "One TACO" concept of having a standardised platform across its business units for processes, hardware and software infrastructure and workforce. The company has also developed centralised planning, marketing and procurement teams to reduce cost and achieve operational efficiencies and economies of scale. TACO shares a strong relationship with Tata Motors which is market leader in
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commercial vehicles and third largest in the passenger vehicle segment. The company also has strong supply relationships with Fiat India, Ford India, GM India and Toyota Kirloskar in passenger vehicle segment and Ashok Leyland, Mahindra & Mahindra in commercial vehicle segments. This positions TACO well to gain for the growth of the Indian automotive industry in the medium to long run.
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Tata Ficosa
Rear-view mirrors, command and control cable system
Address Tata Ficosa Automotive Ltd, Plot -1, Survey - 235/245 Hinjewadi, Taluka Mulshi Pune- 411 027 Maharashtra India Tel: +91 20 6674 5300 Fax: +91 20 6674 5350 Internet: http://www.tataficosa.com Senior Officers RS Thakur, Managing Director Sunil Chaudhari, CEO BP Shiv, Head, Business Development Products Mechanical control cables, parking-brake levers, rear-view mirrors, rod-and-cable gear shifters, washer systems Plants India(4): Maharashtra (3), Uttarakhand Sales INR1.25bn (USD27.5m, 31 March 2011) (Year to 31.03.11) Employees c.500 (2011)
Tata Ficosa Automotive Systems, a part of the TACO Group, is a major supplier of rear view mirrors for passenger cars and commercial vehicles. In addition the company manufactures command and control cables systems.
Tata Ficosa was established in 1998 as a 50:50 joint-venture (JV) between the TACO Group and Spain-based Ficosa International. The JV manufactures: Rear view mirrors: manufactures simple chromatic and the prismatic anti-glare type interior rear view mirrors and external electronic and standard rear view mirrors. Cable and control systems: produces parking brake cable systems, clutch control cables, throttle cables, gear shift with cable mechanisms, hood and fuel filler cap release cables and seat and door latch release cables. Washer systems: supplies windshield washer systems and associated products including expansion tanks, brake fluid tanks, pumps, water level sensor, valves, filters and nozzles, etc. Parking brake systems: includes a self-locking nut for adjustments, cable guides and uniform strokes at both left and right brake shoes and routing flexibility through a twin wire conduit. Gear shifter systems: comprises rod-type systems, cable-type systems, dashboard systems and ultra-compact systems.
The JV operates four manufacturing plants in India. Of the total four plants, the company has maximum three plants in Maharashtra and one in Uttarakhand. Tata Ficosa customers include Fiat, Ford, GM, Hindustan Motors, Honda Siel Cars, Mahindra & Mahindra, Tata Motors, Tata Johnson Controls and Toyota Kirloskar Motors. The company also supplies to tier one suppliers including Brose and Tata Johnson Controls. In addition, Tata Ficosa exports its components to Ficosa and Meritor in overseas markets. Recent Developments Corporate strategy Tata Ficosa is focusing on expanding its customer base in India. The company, which commenced its operations in the country over a decade ago, supplying Tata Motors and GM, has already included several automakers operating in India as its customers. In the past two years, the company secured supply contracts from the global automakers including Nissan and Volkswagen. Tata Ficosa commenced supplying washer systems to the Nissan Sunny sedan and rear-view mirrors to Volkswagen for Polo hatchback and Vento sedan in India. In addition to diversifying customer base in India, the JV is concentrating on strengthening its exports. Tata Ficosas Spanish partner Ficosa International is sourcing components from the Indian JV for its operations in Spain, Mexico and Portugal. Besides, Tata Ficosa is catering to Ford programmes in Europe, Mexico and South Africa. Tata Ficosa is expanding its product line to move up the value chain and become a system supplier. The company has built in-house designing facilities and developed brake lever systems, gear shifter systems and rear view mirrors with hydrophilic film. The company is focusing on rear-view mirrors and washer systems. The company is working to establish plants near its customer base. Tata Ficosa is considering setting up a new manufacturing plant in Sanand, Gujarat (India) in 2012 to supply Tata Motors Nano plant. In addition the company plans to supply Fords upcoming plant, also in Sanand when it commences operations in 2014. Joint Venture Tata Ficosa has a technical alliance with Japan-based Murakami Corporation for rear-view mirror.
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Contracts In 2011, Tata Ficosa started supplying washer systems to the Nissan Sunny. In 2010, Tata Ficosa began supplying rear-view mirrors to Volkswagen India for its Vento and Polo models. In 2009, Tata Ficosa started supplying exterior rear view mirrors for the new Tata World Truck. In 2009, Tata Ficosa commenced supplying gear shifters, rear view mirror sets and washer systems. Tata Ficosa supplies rear view mirrors to the Tata Vista programme. Tata Ficosa supplies rear view mirrors to the Tata Winger programme. Tata Ficosa supplies gear shifters to the Tata Vista programme. Financial Overview In the financial year ended 31 March 2011, Tata Ficosa sales were INR1.25bn (USD27.5m, 31 March 20011) compared with INR864.9m (USD19.2m) in the previous year. The company reported net profit of INR34.1m (USD751,140) compared with INR5.2m (USD115,480) in the previous financial year. Tata Ficosa is a business unit of the TACO Group which is not a publically listed company. Therefore the company does not publish details of its financial performance. Outlook Tata Ficosa expects to maintain steady growth primarily on increased demand for its products from its customers operating in India including Tata Motors. The company has been able to manage to win significant business from the European automakers operating in India through leveraging network of its Spanish partner Ficosa. In addition to the local market, Tata Ficosa expects to win more sourcing opportunities from India, including for the Spanish parent company. The company expects its parent partner will help the Indian subsidiary to broaden its product offering in India.
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Tata Johnson Controls

Seating Systems
Address Tata Johnson Controls Automotive Ltd rd 301 3 Floor Panchshil Tech Park S. No. 19, 20 Hinjewadi Taluka-Mulshi Pune-411 057 Maharashtra India Tel: +91 20 6673 8888 Fax: +91 20 6673 8989 Senior Officers RS Thakur, Managing Director Ashok Belani, CEO Josef Memmel, COO, Engineering Ashutosh Sharma, General Manager, Business development & exports Products Arm rests, foam, headrests, metal frames, seat trims, seats Plants India (8): Jharkhand, Maharashtra (3), Uttar Pradesh (2), Uttarakhand, Tamil Nadu Sales INR7.1bn (USD156.4m, 31 March 2011) (Year to 31.03.11) Employees c.1,100 (2011)
Tata Johnson Control is joint-venture between US-based Johnson Controls and Tata AutoComp (TACO) in India. The JV supplies seat seating systems and components like foam, head rests, armrests and seat trims for the local automotive industry.
Tata Johnson Controls was the first joint-venture set up by the TACO Group in 1996 in a 50:50 partnership with Johnson Controls to manufacture seating solutions for the automotive industry. The company divides its operations into manufacturing and engineering divisions. The Manufacturing division supplies a wide range of seating systems and components like foam, armrests, headrests, and seat trims. The division operates eight manufacturing plants in India with an aggregate capacity to manufacture 1.16 million sets of automotive seats per year. Of this total eight, Tata Johnson Controls operates three plants in Maharashtra, two in Uttar Pradesh and one each in Jharkhand, Uttarakhand and Tamil Nadu. The Engineering division handles Johnson Control's global projects, including engineering, design, static, dynamic and crash analysis, prototype building, trim development and mandatory testing. Based in Pune, Maharashtra (India), the engineering division has 400 engineers servicing 25 of Johnson Controls international customers and product business units in North America, Europe and Asia-Pacific. The division is one of Johnson Control's largest offshore engineering centres in India. Tata Johnson Controls customers include Tata Motors, Fiat India, Daimler India, Ford India, Piaggio, Mahindra & Mahindra, Royal Enfield and Volvo. The company supplies to the global operations of Johnson Controls in Mexico, South Africa and North America. Recent Developments Corporate strategy Johnson Controls entry into India was based on ready volume
business from Tata Motors for its Indica platform variants. Once established, Tata Johnson Controls global relationships helped it win new contracts. The JV has recently diversified to the commercial vehicles seating business. The company is developing mechanical and pneumatic suspension seats for the highend truck segment as it anticipates legal changes in truck seating regulations. Further, Tata Johnson Controls is widening its product range beyond seats to include instrument clusters from Johnson Control's international portfolio. The company has recently entered the electronic instrument cluster market for the compact saloon segment.
Tata Johnson Controls engineering division has assumed an important role for Johnson Controls internationally. A large investment has been made and capabilities established to outsource an increasing amount of development work to its Indian joint-venture. Investments In February 2010, Tata Johnson Controls announced plans to invest INR200m (USD4.34m, 28 February 2010) to upgrade existing manufacturing facilities and introduce new products. The company has also started investing in three new plants, two at Sanand in Gujarat for the Tata Motors Nano model and one in Bangalore, Karnataka for Toyota Etios. In 2006, Tata Johnson Controls increased its seats production capacity to 0.3m sets at its Pune plant in Maharashtra (India). Also in 2006, Tata Johnson Controls increased its installed capacity at its Chennai plant in Tamil Nadu (India) to 40,000 sets per annum from 30,000 sets. Contracts In 2009, Tata Johnson Controls started supplying seating systems for the
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Tata Nano. Tata Johnson Controls supplies seats for Tata Indica, Indigo, Safari and Sumo programmes. Tata Johnson Controls supplies seating systems to Daimler India. As a tier two vendor, Tata Johnson Controls supplies headrests and centre armrest for the Toyota Corolla programme to Araco Automotive.
New Product Development Tata Johnson Controls has one of the largest offshore engineering centres in India which serves Johnson Controls' global seating, interior and electronic design requirements. The company is in the process of launching electronic instrument clusters for passenger cars and utility vehicles, with technology from Johnson Controls. Certifications Tata Johnson Controls is accredited with ISO 14001:2004, QS 9000 and ISO/TS 16949 certifications. Tata Johnson Controls is certified OHSAS 18001 (Occupational Health and Safety Management System). The JV became the first company in TACO Group and Johnson Controls in Asia Pacific to earn this certificate. Financial Overview In the financial year ended 31 March 2011 Tata Johnson Controls reported a 31.5% increase in net sales to INR7.1bn (USD156.4m, 31 March 2011) compared with INR5.4bn (USD119.9m, 31 March 2010) in the previous year. The company reported profit after tax of INR397.8m (USD8.8m), up 66.4% over INR239.1m (USD5.3m) in the previous financial year. Tata Johnson Controls is privately held and does not publish its financial statements. Outlook Tata Johnson Controls has steadily grown to become a leading player in the domestic seating systems sector averaging annual growth from 20% to 25%. The companys export business is assuming an increasingly larger role as Johnson Controls outsourcing of seat parts from Tata Johnson Controls grows. The company plans to widen its product range but may face competition from other TACO group joint-ventures for the same products squeezing its growth opportunities. Yet future prospects for Tata Johnson Controls are good through its growing revenue streams including domestic component market, exports and engineering services.
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Tata Steel
Steel
Address Tata Steel Limited Bombay House 24, Homi Mody Street, Fort Mumbai- 400 001 Tel: + 91 22 6665 8282 Fax: + 91 22 6665 7724/ 7725 Internet: http://www.tatasteel.com Senior Officers Ratan Tata, Chairman B Muthuraman, Vice-Chairman HM Nerurkar, Managing Director Dr. Karl-Ulrich Koehler, Managing Director & CEO Tata Steel Europe Koushik Chatterjee, Group CFO Partha Sengupta, Vice-President, Raw Materials Sandip Biswas, Group Director, Corporate Finance & M&A Bimlendra Jha, Vice-President, Long Products Abanindra M. Misra, Vice-President, CSI and IR T. V. Narendran, Vice-President, Safety and Flat Products Sanjiv Paul, Vice-President, Corporate Services Anand Sen, Vice-President, TQM and Shared Services Products Bearings, cold rolled steel, steel wires Plants India (6): Chhattisgarh, Jharkhand (4), Orissa Outside India: Australia, China, Netherlands, Philippines, Singapore, South Africa, Thailand, United Kingdom (3), Vietnam Sales INR1,187.5bn (USD26.17bn, 31 March 2011) (Year to 31.03.11) Employees 81,251 (31 March 2011)
Tata Steel is a leading supplier of steel and ferro-alloy products in India. The company manufactures steel, welded-steel tubes, cold-rolled strips, bearings, and other related products. The company supplies its products to aerospace, automotive, construction, consumer goods, defence & security, engineering, energy & power, packaging, rail and sheep-building industry.
Tata Steel operations predominantly (contributing 88% of consolidated net sales) relate to manufacturing of steel, including automotive steel, through cold annealed processing, and galvanised cold rolled products. Other operations are largely non-automotive in nature, comprising tubes, bearings, refractories, pigments, port operations, town services and investment activities, which contribute to the rest of sales. The company has manufacturing presence in Asia, Europe, Africa and Australia. In India, Tata Steel operates six manufacturing plants. As on 31 March 2011, the company had 80,251 employees. In financial year 2011, Tata Steel generated 26% of total sales from India. Outside India, the company generated 27% of sales from the UK, 29% from EU excluding UK, 13% from Asia excluding India and 5% from the Rest of the World. Recent Developments Corporate Strategy Tata Steel is investing in additional capacity to meet increased demand for high-grade steel from the automotive and consumer goods industry. In 2010, the company started brownfield expansion at its Jamshedpur plant, Jharkhand (India) which would increase the plants capacity from six million tonnes per annum (mtpa) to 9.7mtpa. This includes ramping up production capacity of flat steel, used mainly in automotive and consumer goods industry, from 3.04mtpa to 5.83mtpa. The company is investing INR150bn (USD3.3bn) in the capacity expansion which is expected to be completed in early 2012. In addition, Tata Steel is investing in a greenfield facility in Kalinganagar, Odisha (India) The company will invest INR200bn (USD4.2bn) to INR250bn (USD5.3bn) in the first phase of the project which will go online in 2014. The plant will have annual production capacity of six mtpa flat steel, for the automotive and white good industry. The companys other ambitious steel projects include setting up a 12mtpa steel plant in Saraikela, Jharkhand (India) with planned investment of INR400bn (USD8.5bn). The company is waiting for rehabilitation and resettlement (R&R) policy of the state government to start the initial process of acquiring land for the plant. The company has also announced plans to INR195bn (USD4.1bn) in a 5.5mtpa steel plant in Bastar, Chhattisgarh (India). Meanwhile the company is taking various initiatives to secure supply of raw materials used in the production of steel. While Tata Steel is 100% self sufficient in iron ore and 50% in coal in India, the company secures all raw materials required at its European plants from the seaborne market. The company has identified and invested in few mining projects globally. This includes development of Benga project in Mozambique, the Direct Shipping Ore (DSO) project in Canada and the Sedibeng project in South Africa. In addition, the company has 5% economic right and 20% off-take right in the Carborough Downs Venture in Australia which produces 1.5mt of semi-hard coking coal. The project is being expanded to double the capacity to three metric tonnes. Acquisitions In December 2007, Kalimati Investment Company, an investment arm of Tata Steel, decided to invest INR2.13bn (USD54m, 31 December 2007)) in Chandigarh-based Steel Strips Wheels Limited (SSWL) in order to buy 10% stake in the company. Tata Steel is a supplier of raw material to SSWL which, in turn, makes wheel rims for Tata Motors, catering to its entire western region. Therefore, buying a stake in SSWL was seen as a strategic investment move by Tata.
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In January 2007, Tata Steel acquired Anglo-Dutch steel maker Corus Group Plc, for GBP6.2bn (USD12.2bn, 31 January 2007) in an open bid. The acquisition made the Tata-Corus duo the fifth largest steel manufacturer in the world with combined capacity of 23 million tonnes per annum (mtpa). The buyout is expected to help Tata Steel be a 40mtpa entity by 2012. In March 2007, Tata Steel through its wholly-owned subsidiary NatSteel Asia entered into an agreement with Vietnam Industrial Investment Ltd (VVI) to acquire 100% held by the latter in Structure Steel Engineering Pte Ltd and 70% stake in Vinausteel Limited. The remaining 30% stake in Vinausteel is with Vietnam Steel Corporation. By virtue of the acquisitions of respective stakes NatSteel effectively acquired two rolling mills located in Haiphong in North Vietnam. This includes a 250,000 tonne per year bar/wire rode mill operated by SSE and an 180,000 tonne per year reinforcing bar mill operated by Vinausteel. NatSteel paid USD41m for the acquisition.
Joint-Ventures In January 2011, Tata Steel and Japan-based Nippon Steel signed a 51:49 joint-venture (JV) to set up Indias first Continuous Annealing and Processing Line (CAPL) for the production of 600,000 tonnes per annum of automotive cold rolled steel at Jamshedpur, Jharkhand (India). The project is expected to come on stream in 2013. This JV will benefit from Nippon Steels expertise in production of high-grade cold-rolled steel sheet and Tata Steels leadership position in the Indian automotive industry to serve its customers with innovative products and services. Divestments In April 2011, Tata Steel and Krosaki Harima Corporation (KHC), an associate of Nippon Steel Corporation of Japan signed definitive agreements to induct KHC as a strategic partner in Tata Refractories Limited (TRL). Under this arrangement, KHC agreed to acquire a 51% equity stake out of Tata Steels current 77.46% stake in TRL. The transaction was completed in June 2011 and TRL was subsequently renamed TRL Krosaki Refractories (TKRL). In February 2011, Tata Steel UK Limited (TSUK), a subsidiary of Tata Steel Europe (TSE), signed an agreement to sell certain assets of Teesside Cast Products (TCP) to Sahaviriya Steel Industries Public Company Limited (SSI) in a deal valuing the business at GBP434m (USD699m, 28 February 2011) . The deal also included TSUK and SSI entering into a joint-venture to operate Redcar Wharf, TCPs bulk terminal. The sale was completed in March 2011. In July 2010, Tata Steels subsidiary NatSteel Holding sold a 27.03% stake in Southern Steel Berhad, Malaysia for a total consideration of USD72m. The divesture is a part of the companys strategy of restructuring its portfolio and reconsidering its position in geographies where it does not have a majority control. In February 2009, Tata Steel Europe completed the sale of its two aluminium smelters in the Netherlands and Germany to Klesch & Co. Investments In August 2011, Tata Steel Europe announced plans to set up a new steel tube manufacturing and processing facility at its Zwijndrecht plant in the Netherlands to serve the automotive sector. The company is investing EUR3m (USD4.3m, 31 August 2011). The expansion will enable the plant to supply specialised chassis components for automobiles. The expansion is expected to be completed by July 2012. In April 2011, Tata Steel Europe announced plans to invest GBP8m (USD13.3m, 30 April 2011) at its Clydebridge plant in Cambuslang, Glasgow (Scotland), to increase its capability to produce high-strength steel plate. The investment will be made to expand the plants two furnaces and instal two new gas cutting machines and a new stamping and marking machines. In June 2010, Tata Steel and Tata Metaliks entered into a memorandum of understanding with the government of Karnataka to establish an integrated steel plant in Agadi and Boodagatti villages of Haveri, Karnataka. The state government has approved 2500acres of land for the project. In May 2010, Tata Steel commenced construction work on a steel plant at Ambagadia, Kalinganagar, Orissa (India). The company will invest
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INR200bn (USD4.2bn, 31 May 2010) to INR250bn (USD5.3bn) in the first phase of the project which will go online in 2014. The plant will have annual production capacity of six million tonnes of flat steel, for automotive and white good industry. In April 2010, Tata Steel commissioned an INR4.07bn (USD91.46m, 30 April 2010) energy efficiency scheme at its steelmaking facility in Port Talbot (UK). This investment will reduce the sites CO2 emissions through the re-use of gases generated at the basic oxygen steelmaking (BOS) plant. The recovered BOS gas will be used to generate an extra 15MW of power 10% of the facilitys total electricity needs. Overall, the scheme will reduce CO2 emissions by approximately 250,000 tonnes per year. In 2008, Tata Steel announced that it was expanding its crude steel making capacity at the Jamshedpur plant in Jharkhand (India) from 6.8mtpa to 9.7mtpa through a 2.9mtpa brownfield expansion. As part of the expansion plan the company is ramping up production capacity of flat steel used mainly in automotive and consumer goods industry, from 3.04mtpa to 5.83mtpa. Tata Steel is investing INR150bn (USD3.3bn) in the capacity expansion which is expected to be completed by early 2012. In May 2007, Tata Steel through its Tata Steel Global Holding in Singapore, signed a joint-venture agreement with Vietnam Steel Corporation and Vietnam Cement Industries Corporation for a steel complex in Ha Tinh province. The plant will have annual production capacity of 4.5 million metric tonne at an investment of USD5bn. The company would own 65% stake in the steel complex project while Vietnam Steel Corporation and Vietnam Cement Industries Corporation has 35% and 5% respectively. However the project has yet to start, due to problems in acquiring the 4,000 acres land required for the plant. In 2006, Tata BlueScope Steel, a 50:50 JV between Tata Steel and Australia-based BlueScope, commissioned its first rollforming and preengineered building facility near the IT Park at Hinjewadi, Pune, Maharashtra (India).
Financial Overview In the financial year ended 31 March 2011 Tata Steel reported a 15.9% increase in consolidated net sales of INR1.2trn (USD26.2bn) compared with INR1trn (USD22.7bn) in the previous financial year. During the financial year the company benefited from increased demand for steel from various sectors in India including Automotive. The companys revenue growth during the year was also driven by high price of steel. Tata Steels sales in India increased 14.8% to INR308.2bn (USD6.8bn) compared with INR268.5bn (USD6bn) in the previous financial year. Meanwhile the companys sales outside India grew at higher rate of 16.4% to INR879.4bn (USD19.4bn) over INR755.4bn (USD16.8bn). In financial year 2011, Tata Steel generated sales of INR294bn (USD6.5bn), Tata Steel Europe INR759.9bn (USD16.7bn), NatSteel Holdings INR74bn (USD1.6bn), and Tata Steel Thailand INR39.1bn (USD861.3m). Higher sales during the financial year led to strong earnings growth at the company. Tata Steel reported profit before tax (PBT) of INR121bn (USD2.7bn) compared with INR310m (USD6.9m) in the previous financial year. The company concluded the financial year with INR89.8bn (USD2bn) against net loss of INR20.1bn (USD446.2m) in the previous financial year. Tata Steel India exceeded one million tonnes in sales to the automotive sector in fiscal 2011, with best ever skin panel and galvanised annealed product sales. Sales of branded products also exceeded one million tonnes in fiscal 2011. Year 2011 2010 2009 2008 2007 Net Sales (INRm) 1,187,531.2 1,023,931.2 1,473,292.6 1,315,336.3 252,123.8 Profit Before Tax (INRm) 121,019.5 310.0 67,432.4 163,710.6 63,130.2 Net Profit (INRm) 89,781.5 (20,092.2) 49,509.0 123,499.8 41,772.7
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Year 2011 2010 2009 2008 2007
Net Sales (USDm) 26,158.3 22,738.8 28,237.9 32,965.8 5,803.7
Profit Before Tax (USDm) 2,665.8 6.9 1,292.4 4,103.0 1,453.2
Net Profit (USDm) 1,977.8 (446.2) 948.9 3,095.2 961.6
Outlook Acquisitions during the past decade have played a key role in the growth of Tata Steel as the worlds fifth leading steel supplier. Since financial year 2005, the company has added capacity by 25mtpa across south-east Asia, the UK and Europe through acquisitions, helping it to have a strong international presence. The company continues to add capacity through greenfield and brownfield expansions which are expected to meet increase demand from its various target markets, including automotive, in coming years. For a steel manufacturer, fluctuations in raw material are always a matter of concern. The upward trend in contract prices of main raw materials used in the production of steel such as iron ore and coking coal has forced several steel makers including Tata Steel to go for backward integrations. The company has invested in several key projects to secure supply of key raw materials such as iron ore and coking coal. Such integration will not only secure adequate supplies of raw material to Tata Steel but also protect the company from fluctuation in their prices.
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Tata Toyo Radiator

Engine Cooling Systems
Address Tata Toyo Radiators Limited Plot 1, Survey 235/245 Hinjewadi, Taluka Mulshi Pune- 411 027 Maharashtra India Tel: +91 20 6652 4100 Fax: +91 20 2293 2196 Internet: http://www.tacogroup.com Senior Officers RS Thakur, Managing Director Mandeep Bhalla, CEO Rajeev Kulkarni, General Manager, Engineering Salil Malvankar, Manager Marketing Arvind S Alur, Manager, PPC & Logistics KP Kapadia, Vice-President, Operations Products Aluminium brazed heat exchangers: Radiators, oil coolers, intercoolers, heater cores, condensers, exhaust gas recirculation (EGR) coolers, fans, fan motors Plants India (4): Jharkhand, Maharashtra, Uttar Pradesh, Tamil Nadu Sales INR4.1bn (USD91.3m, 31 March 2010)(Year to 31.03.10) Employees c. 250 (2008)
Tata Toyo Radiators, a part of the TACO Group, is a leading supplier of aluminium radiators in India. The company also manufactures intercoolers, condensers, EGR coolers, oil coolers, fans and fan motors for the automotive industry.
Tata Toyo Radiator is a three party joint-venture between the TACO Group and Japan-based T.Rad (formerly Toyo Radiator) and Mitsubishi Corporation. While the Indian partner owns a controlling stake of 51% in the JV, T. Rad and Mitsubishi have 40.25% and 8.75% shareholding in the company respectively. Mitsubishi owns its stake in Tata Toyo though its subsidiary Kinsho Corporation. The JV operates one integrated plant in Hinjewadi, near Pune in Maharashtra (India). The plant is capable of producing heat exchangers with capacities of up to 350kW of heat dissipation, which covers most of the automotive and heavy vehicle applications. In addition, Tata Toyo has set up three assembly lines at Jamshedpur, Jharkhand; Luck, Uttar Pradesh and Chennai, Tamil Nadu (all in India). These assembly lines help the company serve its customers Tata Motors and Ashok Leyland more effectively. Tata Motors is Tata Toyos biggest customer, accounting for nearly 60% of its sales. The company other two customers Mahindra &Mahindra and Ashok Leyland accounted for another 20% the companys sales. Tata Toyos other major customers include Eicher Motors, Escorts, Force Motors, GM India, Honda Siel Cars, John Deere, New Holland, SML Isuzu and TAFE. In addition, the company supplies to some tier one suppliers in India including Cummins and Subros. Recent Developments Corporate strategy Tata Toyo Radiator is working on the localisation of technology in order to serve its customers effectively. In May 2011, the company signed a memorandum of understanding (MoU) with Mitsubishi Metal to establish a research and development (R&D) centre. The R&D will develop heat exchange technology in India, which is currently imported in India, particularly from Japan. Tata Toyos current priority is to reduce costs, as the price of inputs such as aluminium and steel, have risen sharply in the past few years. The company has looked at alternative sources of supply, such as China. In addition Tata Toyo has established three assembly lines to serve its major customers Tata Motors and Ashok Leyland effectively and efficiently through significantly cutting logistics costs. Joint Venture In May 2011, Tata Toyo signed a memorandum of understanding (MOU) with Mitsubishi Metals to set up a research and development (R&D) centre in Pune, Maharashtra (India). The local R&D is expected to help the JV serve its customers better through developing several components locally, which are currently being imported in the country, especially from Japan. Investments In 2006, Tata Toyo announced its plan to establish assembly lines in Chennai (Tamil Nadu), Lucknow (Uttar Pradesh) and Jamshedpur (Jharkhand) to supply components to Tata Motors and Ashok Leyland. All three assembly lines are operational. Contacts In 2009, Tata Toyo supplies radiators, inter coolers, heater cores and exhaust gas recharge systems to Tata Nano. In 2009, Tata Toyo commenced supplying integrated modules comprising radiator, fan, motor, shroud, intercooler, condenser, frame and allied parts
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to new Tata Manza Tata Toyo supplies radiators to the Tata Indica Vista programme. Tata Toyo supplies radiators to the Tata Winger programme. Tata Toyo supplies radiators to the Tata Magic and Tata Ace programmes.
Certifications In October 2008, Tata Toyo was accredited with OHSAS certification. In 2006, Tata Toyo announced implementation of Six Sigma, Kaizen, TBEM and ERP systems. In July 2005, Tata Toyo was accredited with TS16949 certification. New Product Developments Tata Toyo has in-house design and engineering capability consisting of prototype development, product/system testing, validation, proprietary software for thermal design of heat exchangers and computational fluid dynamics (CFD) analysis. The company has designed and developed over 300 heat exchangers most of which still are under supply contract. The company is developing downsized and more efficient radiators as opposed to larger ones. In 2011, the JV signed a memorandum of understanding (MOU) with Mitsubishi Metals to set up a research and development (R&D) centre in Pune, Maharashtra (India). The R&D will develop heat exchange technology in India, which is currently outsourced, mainly from Japan. Financial Overview In the financial year ended 31 March 2010 Tata Toyo reported a 31.7% increase in net sales to INR4.1bn (USD91.3m, 31 March 2010) compared with INR3.1bn (USD59.8m, 31 March 2009) in the previous year. The company benefited from strong order from its customers in India which witnessed sharp increase in vehicle production. Higher sales led Tata Toyo to report a 70.7% increase in profit after tax (PAT) of INR367m (USD8.2m) over INR215m (USD4.1m) in the previous financial year. The company is privately-held and does not publish its detailed financial report. Outlook Tata Toyo is benefiting from continuing recovery of the commercial vehicle segment in India. The segment continues to record reasonable growth despite slowdown creeping into the passenger car segment in the Indian automotive industry. Tata Toyos three local customers, Tata Motors, Mahindra & Mahindra and Ashok Leyland, which together account for 80% of its revenue, are witnessing strong surge in demand. Tata Toyo is expected to gain from this stable growth in the commercial vehicles segment in India.
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Timken
Bearings
Address Timken India Limited 39-42, Electronic City Phase II, Hosur Road Bangalore 560 100 Karnataka India Tel: + 91 80 4005 3133 Fax: + 91 80 4136 2010 Website: www.timken.com/india Senior Officers James R Menning, Chairman Ajay Das, Managing Director Deepak Rastogi, Additional Director Ramesh Ramachandran, Business Controller Products Cartridge roller bearings, needle roller bearings, tapered roller bearing Plants India(2) Jharkhand, Tamil Nadu Sales INR4.6bn (USD101.6m, 31 December 2010) (Year to 31.12.10) Employees c. 587 (Year to 31 December 2010)
Timken India is a leading supplier of tapered roller bearings to the domestic automotive industry. The company also manufactures alloy steels and steel components for various applications. In addition, the company imports other types of bearings from the parent groups global facilities and supplies the industrial, offhighway, railways and aftermarket sectors.
Timken India Limited (TIL) was established as Tata Timken Limited in 1987, a joint-venture between Tata Iron and Steel Company (now Tata Steel) and the US-based Timken Company. The parent company contributed to the JV with technical know-how and supplied machinery from its US plants. Tata Timken received a licence to market and service Timken's products in Bangladesh, Bhutan, India, Nepal and Sri Lanka. Both companies held a 40% stake in the JV and the balance was held by public. However, in 1999, the US supplier acquired Tatas stake in the JV and renamed the company Timken India Limited making it a wholly owned subsidiary. Over ten years later, in October 2010, Timken (USA) transferred its 80.02% stake in Timken India to its group company, Timken (Mauritius) Limited. The US company transferred 50.99m shares to the group company at INR154.55 (USD3.46, 6 October 2010) per share. The parent company even considered delisting itself from the Stock Exchange through making an open offer for the 20% shares it does not own in Timken India. Timken India operates two manufacturing plants, one each located in Jamshedpur, Jharkhand and Chennai, Tamil Nadu. In 2010, the company generated 55% of sales from the domestic market, 34% from exports, 3% from bearing accessories and the outstanding 8% from others. The companys customers in India mainly include commercial vehicle and offthe road (OTR) vehicle manufacturers. Timken India's automotive customers include Ashok Leyland, Eicher Motors, Force Motors, Hindustan Motors, Mahindra & Mahindra and Tata Motors. The company exports its products to Australia, Brazil, Europe, South Africa and the US. Recent Developments Corporate strategy Timken India is investing in capacity expansion. In December 2010, the company announced plans to invest INR360m (USD7.8m, 27 December 2010) in ramping up capacities at its Chennai plant in Tamil Nadu (India). The company is witnessing increased demand for taper-roller bearings both in India and other markets. The investment will result in a capacity increase of 2.4 million races of up to 8-inch taper roller bearings, mostly used in commercial vehicles, heavy trucks and off-highway vehicles. Timken has set a goal to become a complete friction management solution provider. In order to achieve this goal, the company is focusing on strengthening its research and development (R&D) capability in India. The company has established a Technology Centre in Bangalore, Karnataka (India) which is one of its nine development centres worldwide. The centre enables the company to provide end-to-end solutions to its customers. The company is further increasing its product offering as well through collaborations with companies in India. Timken's agreement with Spareage Seals is part of the company's strategy to add to its friction management product portfolio. Timken has also collaborated with Daido Steel. Under the five-year agreement, Daido will manufacture specialty steel products according to the specifications for Timken products. Joint-ventures In August 2009, Timken India signed an agreement with Spareage Seals, a manufacturer of oil seals in India. Through the agreement, Timken will offer Spareage seals to its customers and distributors in the country.
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Investments In December 2010, Timken India announced capacity expansion at its facility in Chennai, Tamil Nadu (India) with an investment of INR360m (USD7.8m, 27 December 2010). The company installed new machines to increase production of tapered roller bearings at the plant. The investment resulted in a capacity increase of 2.4m races of up to 8-inch taper roller bearings, mostly used in commercial vehicles, heavy trucks and off-highway vehicles. The expansion completed in 2011. In October 2006, Timken India announced the construction of a greenfield manufacturing facility at Chennai, Tamil Nadu (India) for the production of bearings. The facility became operational in April 2008. In May 2006, Timken India commissioned a new large size cup line at the Jamshedpur facility in Jharkhand (India) with an investment of INR 45m (USD97,345, 31 May 2006). In May 2006, Timken India commissioned the first phase of a double extended (DE) cones manufacturing line at a net investment of INR 24.5m (USD52,999, 31 May 2006). Contracts Timken India supplies pinion tail bearings and other bearings to all Mahindra & Mahindra models. Timken India supplies pinion tail and head bearings to Tata Motors as a tier two vendor through Spicer India, for Sumo, Safari, Spacio, Tatamobile and 207 models. Timken India supplies Ashok Leyland various bearings for Hippo, Beaver, Tusker, Stallion, Comet, Cheetah, Viking and Taurus models. Several contracts are tier two through Automotive Axles. Timken India supplies Force Motors for the Matador model. New Product Developments One of Timkens nine technology centres is situated in Bangalore Karnataka (India) which houses the only rail test facility of India. In November 2011, Timken India launched MileMate wheel bearing sets for the heavy truck industry. The bearing has been designed and developed by Timken engineering working in collaboration with the OEMs to improve life of bearings, optimise bearing performance, lengthen maintenance interval and allow bearings to carry evenly distributed loads.
Financial Overview In the financial year ended 31 December 2011, Timken India generated net sales of 6.5bn (USD119.3m, 31 December 2011) an increase of 41.3% compared with INR4.6bn (USD101.6m, 31 December 2010) in 2010. Higher revenues led Timken India to report strong growth in earnings during the financial year. The company reported a 21.4% increase in profit before tax (PBT) to INR866.2m (USD15.9m) over 713.5m (USD15.7m) in 2010. Timken India concluded the financial year with net profit of INR626.5m (USD11.5m), up 22.7% over INR510.6m (USD11.2m) in the previous financial year. Timken India will change its financial accounting year from January to December to April to March, which conforms to Indian standards. Year 2010 2009 2008 2007 2006 Year 2010 2009 2008 2007 2006 Net Sales (INRm) 4,629.4 3,160.4 4,044.9 3,387.9 3,308.6 Net Sales (USDm) 101.6 67.4 81.4 85.9 75.0 Profit Before Tax (INRm) 713.5 449.1 779.1 560.9 587.5 Profit Before Tax (USDm) 15.7 9.6 15.7 14.2 13.3 Net Profit (INRm) 510.6 325.3 530.0 374.0 381.3 Net Profit (USDm) 11.2 6.9 10.7 9.5 8.6
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Outlook The Indian bearings market is growing at a fast rate. Timken believes the local bearing market to be around USD1.2bn and has doubled its size in the past five years. The company expects increasing industrialisation in India to continue to push demand for bearings in coming years. Customers are becoming more demanding and are looking at more competitiveness and better responsiveness from the bearing industry. This requires major bearing suppliers to localise production bases closer to customers. Timken India, with several years of expertise, is expected to gain from this trend. The company offers a complete line of tapered, spherical and cylindrical roller bearings designed to increase performance, reduce total costs of ownership and minimise environmental impacts.
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TRW Automotive
Chassis, engine, safety and electronics system
Address TRW Automotive 12001 Tech Center Drive Livonia, Michigan 48150 USA Tel: +1 734 855 2600 Fax: +1 734 266 5702 Website: www.trw.com Regional Headquarters Rane TRW Steering Systems Ltd. 45, T.T.K. Road, Alwarpet Chennai-600 018 Tamil Nadu 600 018 India Tel: +91 44 2499 4390 Fax: +91 44 2499 4409 Senior Officers John C Plant, Chairman, President & CEO Steve Lunn, Executive Vice-President & COO Joseph S Cantie, Executive Vice-President & CFO Peter J. Lake, Executive Vice-President, Sales & Business Development Products Actuation brake, foundation brakes, steering gears, system and components, seatbelt system, steering wheels, valves and hoses, Plants India (7): Haryana, Maharashtra, Tamil Nadu (4), Uttarakhand Sales USD16.2bn (year to 31.12.2011) Employees Total: 72,700 (December 2011)
TRW Automotive is one of the leading suppliers of active and passive safety systems. The company manufactures active safety products in the chassis technology area of braking, steering and suspension. The company is also a major supplier of passive safety systems such as seat belts and airbags.
TRW Automotive organises its business into four operating divisions: Chassis Systems (accounted for 61.3% of total sales in 2011): produces steering gears and systems, foundation brakes, brake controls, modules, linkages and suspensions. Occupant Safety Systems (22%): supplies air bags, seat belts, and steering wheels. Electronics (5.2%): manufactures safety electronics, radio frequency electronics, chassis electronics, powertrain electronics and driver assist systems. Automotive Components (11.5%): manufactures engine valves, body controls, and engineered fasteners and components.
TRW Automotive has manufacturing facilities in 26 countries. About 54% of the companys facilities are used by the Chassis Systems segment, 21% by the Occupant Safety Systems, 4% by Electronics and the rest 21% by the Automotive Components. In 2011, Europe contributed 49.3% to the companys total sales, North America 31.5%, Asia 14.4% and Rest of the World 4.8%. In India, TRW operates seven manufacturing plants through two major local joint-ventures (JVs) with the Rane Group and another with Sun Vacuum Formers Private Limited. TRWs JV company with the Rane Group, Rane TRW Steering System, operates three manufacturing plants in Guduvanchry, Kancheepuram and Trichy, all in Tamil Nadu and one in Pant Nagar, Uttarakhand. The companys JV with Sun called TRW Sun Steering Wheels operates two plants one each in Gurgaon, Haryana and Pune, Maharashtra. TRW supplies to all major automakers worldwide. The companys three big customers Volkswagen, Ford and GM together accounted for nearly half of its 2011 sales. The companys other customers include BMW, Chrysler, Fiat, Honda, Hyundai, PSA, Renault-Nissan and Toyota. Recent Developments Corporate strategy TRW Automotive has been following a strategy of shifting its production from high-cost countries in North America and western Europe to low-cost countries in eastern Europe and Asia to drive profitability. In Asia, the company is primarily focusing on China and India which are not only low cost countries but also offer tremendous growth potential. In China the company operates five manufacturing facilities, one technical centre and one research and development (R&D) centre. In India the company operates six manufacturing facilities and is setting up its seventh plant in Pant Nagar, Uttarakhand. The company has formed joint-ventures with Indian suppliers to supply automakers operating in India. TRW has plans to provide licence for its slip control systems (SCS) technology to its joint-venture (JV), Brakes India. Besides, the company has announced plans to open a new manufacturing plant in Pantnagar, Uttrakhand (India) through its joint-venture Rane TRW Steering Systems to manufacture power steering and pumps.
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Joint-ventures In July 2010, TRW expressed intentions to provide licence of slip control systems (SCS) technology to its joint-venture (JV), Brakes India. With the help of the licence, Brakes India will be able to provide manufacturing and local engineering development services to customers in India. Brakes India is a JV established in 1962 between TRW's subsidiary Lucas Industries and TVS Sundram Group. The company manufactures foundation brakes and actuation components in India. In November 2007, TRW Automotive formed a JV with Sun Vacuum Formers to manufacture steering wheel systems in India. The name of the JV is TRW Sun Steering Wheels. The JV utilises an existing manufacturing facility in Gurgaon, Haryana. The facility supports customers in north India region. Sun's Indian customers include automakers such as Maruti-Suzuki, Tata Motors, GM and Ford. The company is also a tier two supplier to Honda and Toyota. Investments In March 2010, Rane TRW Steering Systems, a JV between TRW and Rane Group of India, opened a new manufacturing plant in Pantnagar, Uttrakhand (India) to manufacture power steering and pumps, primarily for commercial vehicles. The company has invested INR140m (USD3m, 5 March 2010) in the plant which has an annual production capacity of 80,000 units of steering gears and 50,000 pumps. The plant will supply components to Ashok Leyland's new plant in Pantnagar. The company also plans to supply to other automakers in the local markets. Divestments In July 2011, TRW divested half of the companys 9.78% stake in Rane Engine Valve at around INR59.2m to Enam Shares and Securities Limited. Enam already owns a 3.92% stake in the company. New Product Developments In the financial year 2011, TRW spent USD827m on research and development (R&D) activities compared with USD669m in 2010. TRW operates 18 research and development centre across North America, Europe and Asia Pacific region. Financial Overview For the financial year ended 31 December 2011 TRW reported a 12.9% increase in net sales to USD16.2bn compared with USD14.4bn in the previous year. The companys operating income rose 6.4% from USD1.2bn to USD1.3bn whereas net income grew 38.7% from USD834m to USD1.2bn during the financial year 2011. Segment wise, Chassis Systems sales increased 16.8% to USD9.9bn; Occupant Safety Systems sales grew 4.3% to USD3.6bn; Electronics sales rose 8.4% to USD842m while Automotive Components sales surged 13.4% to USD1.9bn. Year 2011 2010 2009 2008 2007 Net Sales (USDm) 16,244 14,383 11,614 14,995 14,702 Operating Income (USDm) 1,260 1,184 289 (468) 624 Net Income (USDm) 1,195 834 55 (779) 90 R&D Expenditure (USDm) 827 669 653 857 187 No. of Employees 72,700 69,800 63,600 65,200 66,300
Outlook TRW operates in vehicle safety, which is critically important for the entire automotive industry irrespective of market. Many countries are introducing stringent regulations to improve automotive safety. Vehicle buyers are also becoming aware of safety features and are opting for the vehicle which offers improved safety. Keeping this in mind several automakers are introducing new safety features in their new vehicles to attract these potential buyers. TRW Automotive, as major supplier of both active and passive safety systems is well-positioned to take advantage of this growing trend. TRW expects that growing awareness of automotive safety in emerging markets will increase demand for its products in the region. The company
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hopes that new regulations for vehicle safety equipment in these countries will drive its growth. In an attempt to meet demand and ensure high growth, the company is making huge investments to expand its production capacity in India and China.
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Tube Investments
Metal formed and engineered products
Address Tube Investments of India Ltd Dare House 234, NSC Bose Road Chennai 600 001 Tamil Nadu India Tel: + 91 44 5217 7770/71/ 73 Fax: + 91 44 5211 0404 Internet: http://www.tiindia.com Senior Officers M M Murugappan, Chairman L Ramkumar, Managing Director Pradeep V Bhinde, Additional Director AR Rao, President, Tube Products of India A Suryanarayan, President, Diversification & New Projects P Ramachandran, Senior Vice-President, TIDC India K Balasubramanian, Senior Vice-President & CFO R Natarajan, Vice-President, Corporate Technology Centre K R Srinivasan, Vice-President, TI Metal Forming Products Car door frames, car sashes, cold rolled strips, channels, drive and cam chains for motorcycles, fine blanked components, impact beam, SS rails, sheet metal components, starter motor frame (deep drawn), steel tubes (ERW & CDW) Plants Engineering division: Maharashtra, Punjab, Tamil Nadu Metal formed products division: Andhra Pradesh, Gujarat (2), Haryana, Maharashtra, Tamil Nadu (2), Uttarakhand (2) Sales INR31.3bn (USD689.4m, 31 March 2011) Employees c. 3,150 (2011)
Tube Investments of India (TI) is the flagship company of the Murugappa Group. The company supplies precision steel tubes and strips, car doorframes, automotive and industrial chains and bicycles. TI is the largest manufacturer of precision tubes in India with around 60% market share. The company is also the largest manufacturer of roll-formed car doorframes with more than 60% market share.
Tube Investments of India (TII) was established in 1959 by merging TI Cycles of India and Tube Products of India (TPI). The latter company was formed in 1955 in collaboration with TI Cycles and Tube Products (Old Bury) Limited UK as a measure of backward integration with the bicycle plant. Over the past few years the company has been restructured to focus on automotive business. TI classifies its automotive operations under engineering and metalformed products. Engineering division: involves production of welded precision tubes and strips with special emphasis on Cold Drawn Welded (CDW) and Electric Resistant Welded (ERW) tubes both of which have large automotive applications. Strips comprise a range from sub 350mm to 1,000mm width with application in automotive, bearings, cycle, galvanising drums, barrels, fine blanking, stampings, chains and general engineering. In the strips business the company has a dominant position in southern India. The division operates three facilities, one each in Chennai, Tamil Nadu; Mohali, Punjab and Shirwal, Maharashtra (all in India). The Chennai-based facility acts as an export oriented unit. The division contributed 48.4% to the sales of the company. Metal formed products division: manufactures stampings (chain), cold rollforming (car doorframes) and blanking. Within the chains segment, TI divides its business into industrial and automotive chains. The company supplies automotive chains to OEMs and aftermarket. The roll-forming business produces roll-formed car doorframes. In the fine blanking business, TI manufactures sprockets and power transmission-related products. Fine blanking operations largely supplement chain production. The division contributes around 17% to the total sales of the company. TI is the market leader in the roll-formed car doorframes and automotive chains segments with 57% and 35% market share in these segments respectively.
TI has a domestic client base comprising Ashok Leyland, Bajaj Auto, Delphi Automotive Systems, Gabriel India, General Motors India, Hero Honda Motors, Honda Motorcycle & Scooter India, Hyundai Motor India, Jay Bharat Maruti, Lucas TVS, Mahindra & Mahindra, Maruti Suzuki, Munjal Showa, Royal Enfield Motors, Tata Motors, TVS Motor Co, Visteon India and Yamaha Motor India. Recent Developments Corporate strategy TI is investing INR6bn (USD132.5m, 31 May 2011) to set up greenfield plants as well as ramping up capacities at its existing plants across its all three business segments. The company reached full capacity across its all business during financial year 2011 and is therefore investing to create 35-35% additional capacity in financial year 2012. TI has lined up a capital expenditure of INR3bn (USD66.2m) to set up two tube manufacturing plants one each in the northern and southern part of the county. In addition, the company will invest in new product lines including steel tubes. In the chain business the company will be investing INR1.5bn (USD33.1m) in a new facility at existing locations in the south and in a fine blank facility. In addition the company is investing INR1.5bn (USD33.1m) in Bicycle business to set up a new plant. The company is also exploring acquisition of an international
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cycles and fitness brand. The company is concentrating on high-value products to improve margins. In the Engineering Division, the company is putting greater emphasis on ready-to use tubes and components which allow it to move up the value chain and broaden its customer base. In addition, the division is working to improve capabilities to produce a variety of tubes including stainless steel tubes. In Metal Forming Division the company has set a goal to transform itself from a conventional automotive and industrial chain supplier to a complete transmission system supplier. Meanwhile, TI has enhanced its presence in fine blanked products. To leverage its expertise in metal forming the company is diversifying into railway coach business. This is expected to open new source of revenue for the company. Joint-ventures TI shares a technical agreement with Edward Rose, UK for doorframe production. The company also has an agreement with Dong Won, South Korea for doorframes. Additionally, TI has an agreement with Tsubakimoto Chain Co, Japan for chain production. The company shares a technical collaboration with Wagon Automotive, UK. Investments In May 2011, TI announced plans to invest INR6bn (USD132.4m, 31 May 2011) to expand its tubes, chains and bicycle manufacturing facilities. The company has reached almost full capacity at all the facilities and thus, plans to expand the production capacities by 30% to 35% across all segments. The expansion is expected to be completed and operational by March 2012. In February 2010, TI Metal Forming had announced plans to develop a unit at Sanand, Gujarat (India) by investing INR300m to manufacture doorframes for Tata Nano. The facility has an initial capacity of 3.5 million units. In 2008, Tube Investments opened a new plant to supply door frames to the Tata Indica Vista programme. The company is also setting up a plant for the Tata Nano project. Divestment In 2009, TI closed its China facility as it booked losses of INR400m (USD7.6m, 31 March 2009). In June 2010, TI shifted its plant and machinery from China to its manufacturing facility in Chennai, Tamil Nadu (India). The company will utilise the plant and machinery to expand its production capacity of tubes and door frames supplied to various automobile companies domestically. Contracts TI has a single source contract to supply door frames for the Tata Nano. TI supplies door frames for the Hyundai i10 and i20 programmes. TI is the supplier of door frames to the Tata Indica Vista programme. TI supplies doorframes for the Maruti 800 model. The company supplies doorframes for Hyundai Santro and Hyundai Accent models. Financial Overview For the year ended 31 March 2011 TI reported a 26.5% increase in net sales to 26.9% to INR29.7bn (USD653.4m, 31 March 2011) compared with INR23.4bn (USD520.9m) in the previous year. The company recorded an 84.6% increase in profit before tax (PBT) to INR2.4bn (USD53.2m) over INR1.3bn (USD28.7m) in 2010. TI almost doubled its net profit during the financial year to INR1.6bn (USD37.4m) compared with INR812.1m (USD18m) in the previous year. All operating divisions of the company recorded higher sales and profits despite high costs of raw materials throughout the financial year. TIs Engineering Division reported a 34% increase in sales to INR11.9bn (USD262.1m), primarily driven by strong growth in the automotive industry. The Engineering division reported a 20% sales growth in the tubes segment, including 21% in value-added tubes, and 7% in cold rolled steel. The division reported a 32% increase in profit before interest and tax (PBIT) of INR1.1bn (USD24.2m).
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The Metal Forming Division recorded a 34% increase in sales to INR7.8bn (USD171.8m). The division recorded higher sales in all segments except in Railway Wagons. The Automotive Chains segment grew 30% while sales in the Industrial chains segment increased 11% in India and 60% in export markets. The Fine Blanked Product segment more than doubled its growth during the year, recording a year over year growth of 138%. During the year, the supply of car doorframes surged 17% to one million units. The Metal Forming Division recorded PBIT growth of 26% over the previous financial year. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 29,661.7 23,456.4 20,592.4 17,438.6 16,150.4 Net Sales (USDm) 653.4 520.9 394.7 437.1 371.8 Profit Before Tax (INRm) 2,413.0 1,295.0 830.2 834.4 1,953.4 Profit Before Tax (USDm) 53.2 28.8 15.9 20.9 45.0 Net Profit (INRm) 1,696.6 812.1 721.8 565.0 1,557.8 Net Profit (USDm) 37.4 18.0 13.8 14.2 35.9
Outlook Strong growth in the Indian automotive industry has significantly contributed to improved performance of TI in the past few years, particularly after the global economic slowdown. The company enjoys a diverse but balanced product portfolio covering two-wheelers, passenger cars and the commercial vehicles segment. Therefore the company continue to expect growth despite decline in demand in passenger cars segment. The company hopes that strong growth in two-wheelers and commercial vehicles will enable it to record higher sales and earnings in financial year 2012, though it would not be as impressive as 2011.
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UCAL Fuel Systems

Engine management systems
Address UCAL Fuel Systems Limited Raheja Towers, Delta Wing-Unit-705, 177, Anna Salai, Chennai-600002 India Tel: +91-44-422 08 100/28604795 Fax: +91-44-28604788 Internet: http://www.ucalfuel.com Senior Officers S Muthukrishnan, Director Jayakar Krishnamurthy, Chairman, Managing Director & CFO Products Air intake system, emission control components, fuel rail assembly, high pressure fuel filter, intake manifold, oil pump assembly, precision mochined products, pressure regulator and pulsation damper, positive crankcase vantilation valve, steering system, turbocharger, throttle body assembly, vacuum pump assembly, water pump assembly Plants India: Haryana, Puducherry, Tamil Nadu (3) Sales INR6.5bn (USD133.6m, 31 March 2011) (Year to 31.03.2011) Employees 3,000 (March 2011)
UCAL Fuel Systems is a part of the UCAL Group, one of India's largest manufacturers of carburettors and mechanical fuel pumps for the domestic automotive industry. UCAL also supplies parts for fuel-injection systems. It primarily supplies to the domestic two-wheeler industry.
Incorporated in 1985 by Carburettors Limited, as a company with operations in the field of fuel management solutions. Subsequently UCAL tied up with Mikuni Corporation (Japan) by forming a technical/financial joint-venture (JV). However, in 2008, Mikuni exited the JV by selling its 26% stake to Carburettor Ltd. UCAL has a production capacity of 60,000 oil pumps and 0.35m fuel taps per month. With the implementation of stricter emission norms OEMs have phased out carburettors in case of four-wheelers. This caused a considerable shake-up in the business set-up of UCAL. In recent years India has adopted stricter emission norms following which UCAL entered into production of MPFI hardware products such as throttle body, delivery pipe with pressure regulator and high pressure fuel filters. UCAL has also ventured into offshore markets. In 2003, the company commenced production of electric throttle valve and allied products exclusively for the global market. UCAL has further diversified into oil pumps. Also, in June 2005, UCAL acquired a 100% equity in Amtec Precision Products, USA making it a wholly owned subsidiary. The company is using Amtec to diversify its product base and use the marketing infrastructure of the company to improve offshore sales. Amtec manufactures fuel system components like transmission components, electronic sensor housings, ride control components, rocker assembly arm, air filter assembly and plastic moulded parts for the North American market. Another wholly owned subsidiary of the company is UCAL Polymer Industries Limited. The subsidiary was established in 2000 and specialises in manufacturing rubber-bonded parts for automotive applications. The company commenced production of rubber-bonded components, which are fitted into secondary air suction valves. Another wholly owned subsidiary, UCAL Machine Tools Limited was merged with UCAL Fuel Systems on 1 July 2010. The merger was completed after the approval from the High Court of Madras. UCAL Fuel systems customer list includes some of leading automakers such as Maruti Suzuki, Hyundai and GM and prominent tier one suppliers such as Bosch, Continental and Mikuni. The companys primary client list of twowheeler companies includes, Baja Auto, Hero Motorcorp, Suzuki, TVS Motors and Yamaha. Recent Developments Corporate strategy UCAL Fuel Systems posted a turnaround in fiscal year 2010 which was mainly due to the recovery in the automotive industry. However, this also marks a year after its equity partner, Mikuni exited the company in 2008. Also, in financial year (FY) 2010, the company started benefiting from its acquisition of Amtec Precision products as its operations stabilised. This was also due to the UCALs infusion of funds of around INR154.5m (USD, 9 August 2009) in Amtec to make the company profitable. In May 2010, UCAL announced that it planned to sustain the 25% growth in sales in FY2011 and also consolidate its two-wheeler business. The company plans to introduce new technologies for passenger car vehicles and aims to become a global supplier for vacuum pumps and oil pumps. UCAL is supplying water, oil and vacuum pumps to Fiat in both the domestic and global markets
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and also to Continental in its global market. The company further plans to extend its reach to automakers such as Nissan, BMW and Ford that are developing their presence in India. Also, with a significant increase in revenues in the fiscal year 2010, the company plans to manufacture powertrain products. For this, the company plans to form joint-ventures with already established companies in the sector. Earlier, Mikuni Corporation, that held 26% equity in UCAL, exited the company in 2008. The company has established two new facilities in India one in Bawal (Haryana) and the other in Chennai (Tamil Nadu). The facilities will cater to the increasing demand from the automakers in the country. With the establishment, UCAL expects a compound annual growth rate of 15% over the next ten years. Investments In 2010, UCAL Fuel Systems had announced plans to establish a new facility in Bawal, Haryana (India) and Chennai by investing INR150m (USD3.3m, 19 May 2010). The Bawal plant manufactures air suction valve and oil pumps for Maruti Suzuki and Hero Motorcorp and Chennai plant will mainly cater to overseas markets. The facility was established in early 2011. In December 2007, UCAL announced the setting up of a greenfield unit at Bawal, Haryana to supply to Suzuki Powertrain at its diesel engine unit at Manesar. UCAL is investing INR360m (USD9m, 31 March 2008) The plant supplies 0.35m oil pump units and 0.25m manifolds per annum to Suzuki Powertrain. Contracts UCAL supplies multi-point fuel injection (MPFI) parts such as throttle body assembly, fuel rail assembly, high pressure fuel filter, pressure regulator and pulsation dampers to automakers such as Maruti Suzuki and Hyundai, and to tier one suppliers such as Bosch, Mikuni and Continental. The company also supplies emission control products such as positive crankcases, ventilation valves and intake manifolds to Maruti Suzuki. Among pumps, UCAL supplies oil pump assembly to Suzuki Powertrain, Leyland Nissan and FIAT and vacuum pump assembly is being supplied to Suzuki Powertrain. Other than automakers, the company supplies high pressure die-cast products to tier one suppliers such as Mando, Sona Koyo and Continental and precision machined products are supplied to Amtec and Allison Transmission. Certifications UFSL has been accredited with QS 9000 status. New Product Developments UCAL Fuel Systems R&D expenses for the year ended on 31 March 2011 amounted to INR88.9m (USD1.9m, 31 March 2011). The company has its R&D centre at Ambattur in Chennai with around 100 engineers. The company has also collaborated with IIT-Madras where the engineers can obtain their PhD. In 2010, UCAL developed water, oil and vacuum pumps for passenger cars and are supplied to Fiat and Continental. Financial Overview For the financial year ended 31 March 2011, UCAL reported net sales of INR6.1bn (USD133.6m, 31 March 2011), an increase of 21% from INR5bn (USD111.3m, 31 March 2010) for the same period in the previous year. The company reported profit before tax (PBT) of INR282.9m (USD6.2m) in fiscal year (FY) 2011 against loss of INR215.8m (USD4.8m) in the previous year. The company also reported net profit of INR192.6m (USD4.2m) compared to net loss of INR237.6m (USD5.3m) in FY2010. The Indian operations of the company reported sales of INR3.9bn (USD85.9m), up by 31.3% from INR3bn (USD66.6m) in the previous year. The growth was mainly attributed to the 26% increase in the automotive sector and 20% increase in automotive component sector.
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Year
Gross sales, (INRm) 6,066.2 5,012.9 4,800.5 5,844.0 6,559.9 Gross sales, (USDm) 133.6 111.3 92.0 146.5 151.0
2011 2010 2009 2008 2007 Year
Profit Before Tax (INRm) 241.2 (257.5) (757.1) (215.7) (343.4) Profit Before Tax, (USDm) 5.3 (5.7) (14.5) (5.4) (7.9)
Net Profit, (INRm) 192.6 (236.9) (765.3) (441.5) (212.7) Net Profit, (USDm) 4.2 (5.3) (14.6) (11.1) (4.9)
R&D Expenses (INRm) 88.9 88.5 50.2 60.5 R&D Expenses (USDm) 1.9 1.9 0.9 1.5 -
2011 2010 2009 2008 2007
Outlook UCAL expects to further benefit from the projected increase in the automotive production in India. The industry experts expect volumes to increase to nine million units in passenger car segment by 2020. Two- and three-wheeler vehicles are expected to increase to 33 million units and commercial vehicles to 2.2 million units. The company has achieved its projected sales increase of between 20% and 25% in FY2011, which also forms a base for the company to expect higher returns in the coming years. Establishment of the new facilities in 2010-2011 will also help the company to increase its production capacity to meet the increasing demand in the domestic market. Also, the increasing presence of global automakers in the Indian market provides an opportunity to increase the company's reach. UCAL's set investment in R&D activities will also help it to develop new technologies which would meet the demand for innovative products by global customers.
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Valeo
Climate control, engine cooling, lighting, transmissions
Address Valeo SA 43, rue Bayen 75848 Paris Cedex 17 France Tel: +33 1 4055 2020 Fax: +33 1 4055 2171 Internet: http://www.valeo.com Regional Headquarters Valeo India Private Limited Block A, 4th Floor, TECCI Park N 285 Rajiv Gandhi Salai (OMR) Sholinganallur Chennai-600 119 Tamil Nadu India Tel: +91 44 22 505 000 Fax: +91 44 22 505 011 Senior Officers Jacques Aschenbroich, CEO Christophe Prillat-Piratoine, COO Robert Charvier, CFO Edouard de Pirey, Vice-President, Corporate Strategy & Planning Hans-Peter Kunze, Senior Vice-President, Sales & Business Development Martin Haub, Vice-President, Research & Development & Product Marketing P.R. Dhaamodharan, Group President and Managing Director, Valeo India Products Adaptive lighting, alternators, blind spot detection systems, electromagnetic retarders for trucks and buses, emission control systems and components, ignition components, lane departure warning systems, modular front end systems, night vision systems, ultrasonic park assist systems, sensors, starters Plants India (9) Sales Group: EUR9.6bn (USD12.8bn, 31 December 2010) (Year to 31.12.10) India: NA
Valeo is major supplier of components, integrated systems and modules for cars and trucks. The company manufactures lighting, engine, transmission, thermal systems and security systems components for passenger cars and commercial vehicles.
In 2011, the company reorganised its product portfolio into four business units: Comfort and Driving Assistance Systems (accounted for 20% of 2011 sales): interior controls, security systems and driving assistance. Powertrain Systems (29%): engine and electrical systems, transmission products and powertrain efficiency domain organisation. Thermal Systems (28%): climate control, compressors & engine cooling and the comfort enhancement domain organisation. Visibility Systems (23%): lighting systems and wiper systems. As of September 2011, Valeo had 124 plants, 21 research centres, 40 development centres and 12 distribution platforms. The company employed about 68,000 people in 28 countries worldwide. In fiscal 2011, Valeo generated 56% of its sales from Europe and Africa, 15% from North America and 22% from Asia. The remaining 7% came from South America. In India, the company operates nine manufacturing plants, of which five are located in Pune, Maharashtra and four in Chennai Tamil Nadu. In India, Valeo is present in key product lines including Powertrain Systems, Visibility Systems, Thermal Systems and Comfort and Driving Assistance Systems. The company is mainly present in India through strategic joint-ventures with major local suppliers. For example, the company has joint-venture (JV) partnerships with the Amalgamation Group, Ashok Minda Group and the Anand Group. Valeo generated 84.7% of its 2011 sales from original equipment manufacturers (OEMs) and 15.3% from aftermarket.Among OEMs the company supplies to all major vehicle manufacturers including BMW, Fiat, Ford, GM, Honda, Hyundai, MG Rover, Mitsubishi, Navistar, Paccar, Porsche, PSA Peugeot Citron, Renault-Nissan, Subaru, Toyota, Volkswagen and Volvo trucks. Recent Developments Corporate strategy Valeo is focusing on CO2 emission reductions and high growth in emerging market to achieve EUR14bn (USD18.5bn) in sales in 2014 compared with EUR10.9bn (USD14.1bn) in 2011. The company hopes to record an average organic growth rate of 8% a year but is also seeking some selective acquisitions. In the area of reducing CO2 emission reductions Valeo is giving more importance to its electrical systems products, particularly in engine management and hybridisation. In lighting, the company will focus on LED systems and lightweight products to help the company achieve this. Focusing on emerging markets is another key strategy for Valeo. The company plans to commit about 60% of its investments to emerging countries including India, China, Brazil, Thailand and Turkey. Valeo also intends to progressively develop its presence in Russia. India and China are the two most significant markets in emerging countries for Valeo. The company forecasts its sales in these two dynamic markets to reach EUR3bn (USD60.2m) by 2013 and EUR5bn (USD100.3m) by 2020. In India, Valeo announced construction of a new plant in Sanand in Gujarat one of Indias upcoming auto hubs. The planned investment is in line with the companys strategy to expand its presence in the country by localising
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Employees Group: 57,930 (31 December 2010) India: NA
operations. The erstwhile small town in the state of Gujarat has been catapulted to the league of prominent auto hubs such as Pune in Maharashtra and Sriperumbudur in Chennai. Major automakers such as Ford, Tata Motors and PSA Peugeot Citron have drawn big plans and are establishing facilities in Sanand to capitalise on the growth potential of the Indian automotive market, especially in the small car segment. Acquisitions In May 2010, Valeo acquired a 100% stake in its electrical systems manufacturing joint-venture (JV) based in Pune, Maharashtra (India). The JV was formed with the N.K. Minda Group in 2007 to manufacture alternators and starters for passenger cars. The JV was 66.3% owned by Valeo and 33.3% by the N.K. Minda Group. Post-acquisition, the companys name was changed to Valeo Engine and Electrical Systems India Private Ltd. Joint-ventures In October 2008, Valeo and India-based Anand Group formed a JV in India, for the production of lighting systems. Valeo holds the majority stake in the venture named Valeo Lighting Systems India Private Limited. The venture is located in Chennai, Tamil Nadu (India) and produces lighting systems including projectors, lights and rear fog lamps for the Indian automotive market. In May 2007, Valeo and Minda Industries Ltd (MIL), through a 50:50 JV, decided to set up a manufacturing facility for security products. The initial investment in the venture is worth INR1bn (USD24.4m, 31 May 2007). Investments In December 2011, Valeo showed interest in establishing a manufacturing facility in Sanand, Gujarat (India). The plant is expected to be operational by 2013. In December 2011, Valeo announced plans to expand its friction material facility in Maraimalainagar and also to establish a new facility in Oragadam to manufacture clutches, both situated in Chennai (India). Contracts Brand/OEM Tata Motors Maruti Suzuki Renault Mahindra Model Indica Vista, Nano A-Star Fluence Xylo Components Immobilizer, clutch sets, outer door handle, lockets, remote keyless entry, steering column lock Alternator Clutch on K4M engine, concentric slave cylinder (CSC) on K4M engine Clutch facing
New Product Developments In 2011, Valeo's R&D expenses were EUR561m (USD726.4m), up 4.5% from EUR537m (USD712m) in 2010. The R&D expenditure during 2010 was equivalent to 5.2% of the companys sales during the financial year. In 2011, Valeo had 40 research centres and 21development centres across all major automotive markets. The company operates three R&D centres in Indica including one each in Powertrain Systems, Visibility Systems and Thermal Systems. In December 2011, Valeo announced that its research and development facility in Chennai (India) was developing starters and alternators for the small car segment. The products are expected to be ready in 2012, which will be supplied to both Indian and South American markets.
Financial Overview For the financial year ended 31 December 2011 Valeo reported a 28% increase in net sales to EUR10.9bn (USD14.1bn, 31 December 2011) from EUR9.6bn (USD12.8bn, 31 December 2001) in 2010. The companys sales increased 9.6% in Europe and Africa to EUR6.3bn (USD8.2bn), 20% in Asia to EUR2.3bn (USD2.9bn), 24.2% in North America to EUR1.5bn (USD1.9bn) and 1.4% in South America to EUR767m (USD993.1m). The company does not disclose India specific sales.
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Higher sales led the company to record a 19% increase in operating income to EUR704m (USD912m) compared with EUR590m (USD782m) in the previous financial year. The company posted a 17% increase in net income to EUR427m (USD553m) over EUR365m (USD484m) in 2010. Year 2011
2010 2009 2008 2007
Net Sales (EURm) 10,868

9,632 7,499 8,664 9,555
Operating Income (EURm) 704

590 84 (52) 319
Net Income R&D (EURm) Expenditure (EURm) 427 561

365 (153) (07) 81 537 473 639 668
No. of Employees 68,000

57,930 52,110 51,140 61,052
Year
2011
2010 2009 2008 2007
Net Sales USD m 14,072

12,763 10,748 12,212 14,063
Operating Income USDm 912

782 120 (73) 470
Net Income USDm 553

484 (219) (10) 119
R&D Expenditure USDm 726

712 678 901 983

57,930 52,110 51,140 61,052
Outlook Valeo made a strong financial recovery in financial year 2010 and 2011, ahead of its 2013 target. The company is now focusing on growing even further, primarily through the organic route, recording higher average growth than the automotive industry to meet its sales target of EUR14bn (USD18.5bn) by 2014. Valeo is also scouting for few acquisitions to complement its organic growth.Strong growth in emerging markets, particularly China and India, should help the company achieve its financial goals. The upcoming facilities in India are also expected to help Valeo continue to achieve its target in the coming years. The new facilities are also expected to help the company overcome the difficult economic conditions globally. The company plans to customise some of its products to cater to the unique needs of the Indian small car segment. At present, Valeo manufactures four product groups in India from its portfolio of 16 product groups. This includes clutches, friction materials and lighting, security systems, starters and alternators at its plants in Chennai and Pune. Thus, there is further scope to increase its product portfolio in the Asian country.
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Varroc Group
Diversified automotive supplier
Address Varroc Engineering Pvt Ltd E-4, MIDC, Waluj Aurangabad 431136 Maharashtra India Tel: +91 240 2556 227 Fax: +91 240 2564 540 Internet: http://www.varrocengg.com Senior Officers Naresh Chandra Jain, Chairman Tarang Jain, Managing Director Sanjiv Kumar, President Vineet Tyagi, Vice-President OperationsSN Patil, Vice-President, Operations, Polymer division Ram Parthasarthy, Vice-President, Operations, Metallic division Nagesh Nadig, Vice-President, Finance PC Rajagopal, Vice-President, Operations, Electrical Division Products AC generator, air filter assemblies, blinkers, cam shaft, capacitor discharge unit, catalytic converter, cold forged components, crank pins, crank shaft, digital instrument cluster, door trims, engine valves, handle bar assemblies, head lamps, hub assemblies, HVAC & under boner components, injection moulded plastic components, multiplayer sheet plastics extrusion, polyurethane foam seat assemblies, rear fenders, rear view mirrors, rectifier units, reed valve regulators, rubber moulding, starter motor, steering assemblies, switches, tail lamp and wiper motors Plants India: Haryana, Maharashtra (15), Madhya Pradesh, Uttar Pradesh, Uttarakhand Outside India: Italy, Poland Sales INR24.5bn (USD539.7m, 31 March 2011) Employees c. 10,000 (May 2011) Bajaj Auto is Varrocs largest customer. In addition, the company supplies to Atul Auto, Delphi India, Fiat India, GM India, Honda Motorcycle & Scooter India, Lear Seating, Maharashtra Scooter, Mahindra & Mahindra, Maruti Suzuki, Royal Enfield, Tata Ficosa, Tata Johnson Controls, Tata Motors, Tata Toyo Radiator, Volkswagen India, and Yamaha Motors India. International OEMs include Ducati (Italy), GM (US), Lombardini (Italy) and Piaggio (Italy). Recent Developments Corporate strategy Varroc Group has set a goal to achieve sales of INR40bn (USD881.1m, 31March 2011) by financial year 2013 compared with INR25bn (USD539.7m) in 2011. In order to achieve this goal the company intends to go for a few selective acquisitions. In January 2012, Varroc announced the
Varroc is a diversified automotive supplier with interests in plastics and rubber, and seats, electrical and engineering components. The company supplies its produces to twowheelers, three-wheelers, passenger cars and commercial vehicles.
Varroc was founded in 1990 by the Jain group to supply engineering plastic injection moulded components for Bajaj Auto and white goods producer, Videocon. Currently, the company operates 22 manufacturing plants, including two in Europe, and three engineering centres. The company employs over 10,000 people. In 2007-08, the companys operations were strategically restructured into two main divisions: Varroc Engineering (contributing 65% to group sales) and Varroc Polymer (contributing 35% to group sales). Polymer division: called Varroc Polymers Private Limited. (VPPL) has eight manufacturing facilities of which three are in Pune and two in Aurangabad, both in Maharashtra; and one each in Gurgaon, Haryana; Noida, Uttar Pradesh and Pithampur, Madhya Pradesh. Engineering division: called Varroc Engineering Private Limited (VEPL), which is further divided into the following sub-divisions: Electrical division: operates five manufacturing facilities that run with technical support from Japanese and European manufacturers. Metallic division: with three plants dedicated for hot, warm & cold forging; and three plants for manufacturing engine valves in collaboration with Scarpa & Colombo s.r.l. of Italy.
In addition, the company has an integrated facility in Pantnagar, Uttarakhand (India) that caters to the entire product portfolio of Varroc including Polymers, Electrical and Machined Forgings. Varroc has three technical collaborations to manufacture interior rims, automotive lighting, and automotive catalytic converters. Varroc Group also operates one manufacturing plant in Chakan, near Pune in Maharashtra (India) in a joint-venture partnership with France-based Plastic Omnium. The JV, Plastic Omnium Varroc, supplies automotive exterior products for the passenger vehicle segment. Besides, Varroc is setting up a manufacturing plant in Waluj, Aurangabad, Maharashtra (India) which will produce crankshafts for six-cylinder engines primarily for commercial vehicles. The company supplies to two-wheelers, three-wheelers, four-wheelers and commercial vehicles. The company generates around 70% of its sales from twoand three-wheelers. Four-wheelers, off-road vehicles and oil & gas account for 25% of its sales. The company generates the balance 5% from white goods.
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acquisition of controlling stake of 80% in Italy-based leading two-wheeler headlamp and rear light supplier TriOM for an undisclosed amount. The acquired company is a supplier to two-wheeler manufacturers such as Piaggio, Honda, Yamaha and Ducati, with nearly 55% market share in Europe. TriOM operates one plant in Italy and another in Romania. In addition, the company is setting up a new plant in Vietnam to cater to the growing twowheeler market in the Association of Southeast Asian Nations (ASEAN). The acquisition is expected to strengthen Varrocs technology, widen its product offerings and expand its international presence. The company is also looking for acquisitions for strengthening its presence in the four-wheeler segment from which it generates 25% of its sales. Varroc is keen to form joint-ventures with certain global suppliers to supply passenger vehicle manufacturers. In April 2010, Varroc announced investment of at least INR5bn (USD112.5m, 28 April 2010) by financial year 2014 to focus on forming JVs in India for electrical/electronic components and assemblies in the four-wheeler space. Varroc operates one such JV with Plastic Omnium formed in January 2008. The JV, Plastic Omnium Varroc, commenced operations at a manufacturing plant in Chakan near Pune, Maharashtra (India) in September 2010. The JV supplies to automakers present in western India including GM, Mahindra & Mahindra and Volkswagen. The JV is planning to further expand its presence in India through some selective acquisitions. Plastic Omnium Varroc has earmarked INR2bn (USD44.1m) for its expansion including INR1.6bn (USD3.5m) to set up two plants in India, one in Chakan, Maharashtra and another in Sanand, Gujarat. The JV could also set up a plant in southern India to cater to automakers there. Varroc is entering into another new segment in the automotive industry. The company has begun production of six cylinder crankshafts for commercial vehicles. Varroc is setting up a dedicated manufacturing plant in Waluj, near Aurangabad, Maharashtra (India). In addition Varroc is diversifying into nonautomotive business. The company, which caters to white goods sector, has forayed into oil and gas business. Eventually, Varroc aims to have a balanced portfolio, generating 65% of its sales from automotive and 35% from nonautomotive sector. Acquisitions In January 2012, Varroc acquired a controlling stake of 80% in Italybased leading two-wheeler headlamp and rear light supplier TriOM Spa for an undisclosed amount. The acquired company is a supplier to major two-wheeler manufacturers, including Piaggio, Honda, Yamaha and Ducati, with nearly 55% market share in Europe. TriOM operates one plant in Italy and another in Romania. In addition, the company is setting up a new plant in Vietnam to cater to growing two-wheeler market in the Association of Southeast Asian Nations (ASEAN). The acquisition is expected to strengthen Varrocs technology, widen its product offerings and expand its international presence. In February 2007, Varroc acquired Italy-based hot forging manufacturer Imes Spa with an annual installed capacity of 110,000 tonnes of forged parts. The deal includes two forging units, one each in Italy and Poland. The Polish plant had a high unused capacity which Varroc expects to leverage for its metallic division as a local supply base in Europe. Joint Venture In January 2008, Varroc entered into a 40:60 joint-venture with Francebased Plastic Omnium to manufacture automotive exterior parts in both thermoplastic and thermoset technologies for the Indian market. The alliance is focused on design, development and production of bumpers, bumper modules, claddings, rocker panels, finishers, structural parts (beams, crash cladding for front and rear), front end carriers, painted body panels (including tailgates panels) and wheel arch housing. In September 2010, the JV commissioned a manufacturing plant in Chakan, near Pune, Maharashtra (India). The JV supplies automotive exteriors to automakers such as GM, Mahindra & Mahindra and the Volkswagen Group. Investments In 2011, Varroc Group announced that it was investing INR1.5bn (USD33m, 31 March 2011) in establishing a facility at Waluj in Aurangabad, Maharashtra (India) to produce crankshafts for six cylinder
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engines for commercial vehicles. The plant is expected to commence operations in financial year 2013 and is expected to generate sales of INR2.25bn (USD45.4m, 17 October 2011) by financial year 2016. The plant will have production capacity of 200,000 crankshafts a year. In April 2010, Varroc announced an investment of at least INR5bn (USD112.5m, 28 April 2010) by financial year 2014 to focus on forming JVs in India for electrical/electronic components and assemblies in the four-wheeler space. In 2008, Varroc invested INR1.40bn (USD35.1m, 31 March 2008) to expand its metallic division. In 2008, Varroc started operations at its integrated Pantnagar facility in Uttarakhand (India). The company established a manufacturing plant in Pantnagar to supply its major customer Bajaj Auto, who commissioned a greenfield two-wheeler plant in the same region. In 2007, Varroc invested INR1bn (USD23.02m, 31 March 2007) to scale up its existing operations across all verticals.
Contracts In 2011, Plastic Omnium Varroc commenced supplying bumpers to new Skoda Rapid sedan. In 2010, Plastic Omnium Varroc started supplying plastic exterior painted components to Mahindra & Mahindra for its commercial vehicle models Gio and Maximmo Plastic Omnium Varroc supplies bumpers to GM India for its hatchback Chevrolet Beat. Certifications Varroc is committed to obtain ISO 14001/OHSAS 18001certification for all its plants by maintaining highest quality standards. All Varroc Groups companies are now TS 16949 certified. Polymer Division: two Aurangabad based facilities are ISO TS 16949:2002 certified, another Aurangabad based facility is ISO 90012000 accredited and another set up in Pune is QS 9000-1998 certified. Electrical Division: two Aurangabad based facilities are ISO 9001-2000 certified. Metallic division: one plant in Aurangabad is QS 9000:1998 accredited.
Financial Overview In the financial year ended 31 March 2011 Varroc Group generated sales worth INR24.5bn (USD539.67m, 31 March 2011). The company is privately owned and does not publish financial statements. Outlook Varroc Group aims to grow at compound annual growth rate (CAGR) of 25% over the next five years (2016). The company is focusing on both organic and inorganic growth to reach its sales target of INR40bn (USD881.1m, 31March 2011) by financial year 2013. At the same time the company is focusing on diversifying its business so as to reduce its risk profile. While two-s and three-wheelers remain the major source of sales and earnings, Varroc is focusing on high-margin four-wheelers and commercial vehicle segments. The company has made a good start in the four-wheeler segment through partnering with the French supplier Plastic Omnium. The JV, Plastic Omnium Varroc, has tremendous growth potential to become one of the leading suppliers of automotive exteriors in India. In the four-wheeler space, Varroc has so far only ventured into plastic moulded components, engine valves and forged components, but the company is committed to soon diversify into electrical components and electronic control systems. In addition, Varroc has begun producing crankshafts for six-cylinder engines for commercial vehicles. This is also expected to open a new avenue of sales and profits for the company. These initiatives are expected to reduce the companys overdependence on the two-wheeler business and for it to have a more balanced product portfolio in coming years.
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Victor Gaskets
Gaskets
Address Victor Gaskets Limited, 152/223, Village Mahalunge Chakan-Talegaon Road Tal. Khed Dist. Pune 410 501 Maharashtra, India Tel: + 91 2135 677 300 301 Fax: + 91 2135 677238 Internet: http://www.victorgasketsindia.com Senior Officers C S Patel, Chairman D G Palve, Chief Operating Officer & General Manager Sachin Puri, Vice-President, Marketing Products Cylinder head gaskets, exhaust & intake gaskets, inlet manifold gaskets, oil pan gaskets, secondary gaskets, timing gear gaskets, valve cover gaskets, heat and acoustic shields, shock absorbers, engine bearings Plants Chakan Sales c. INR555.9m (USD11.1m, 31 March 2011) (Year to 31.03.2011) Employees c.250 (31 March 2011)
Part of the Anand Automotive Group, Victor Gaskets is a major player in the Indian automotive gaskets market. The company operates from a single manufacturing facility in the western cluster close to Pune.
Victor Gaskets was set up as a joint-venture with Dana Corporation but now operates as an Anand Group company. The company has developed in-house competence for non-asbestos gaskets for automotive and non-automotive applications. The company manufactures a wide range of gaskets for application in Automotive, Industrial, Earthmoving, Stationary and Railroad segments. Additionally the company has a product validation centre at Nashik which takes care of the testing of materials as well as faster verification and validation of product designs. Victor Gaskets is Indias first asbestos-free company which uses non-asbestos material in the production. Victor Gaskets domestic client base includes, Ashok Leyland, Avtec India, Cummins India, Ford India, General Motors, Greaves India, Hero Motors, Hindustan Motors, Hindustan PowerPlus Caterpillar, Lombardini India, Mahindra & Mahindra Automotive Division and Farm Division, Maruti, MICO Bosch, Simpson & Company, Tata Motors and Toyota Kirloskar Motors. Victor Gaskets international customers includes, Audi Slovakia, IvecoItaly, Lister Petter UK, TVS, New Holland Tractors, Victor Reinz Dana USA and VW. Recent Developments Corporate strategy The companys focus on the development of gaskets for newer engines in 2010 proved to be profitable, while other automotive manufacturers postponed their production in line with global trends. The companys exports showed an upward trend and increased 25% to INR38.6m in 2011 as compared to INR30.9m in the previous year. The company believes that it has proven capability to supply to new entrants based on its success with present clientele, where it has been delivering on a zero ppm basis. Victor Gaskets has established a strong presence through its aftermarket distributors in Dubai, Sri Lanka, and Singapore. Victor Gasketss exit from the asbestos business has attracted many OEMs in India to recommend sourcing parts from the company to their respective clients overseas. The company is expanding its presence by adding heat shields to its portfolio. Joint-ventures Victor Gaskets shares a technical alliance with Dana Corporation for non-asbestos gaskets. Victor Gaskets also shares a technical alliance with Hamamastu Gasket Corporation (Japan) for developing coatings of fluroelastomer on stainless steel. Certification Victor Gaskets is accredited with QS 9000, TS 16949 & ISO 9002 status. Infrastructure Automated and Continuous Perforation & Material Line for Head Gaskets Single Piece Flow Robotic Head Gasket Line CNC Indexing Head Hydraulic Press Mechanical Presses 16 T thru' 400 T Fully Auto Screen Printing Line & Infrared Cure Ovens Spot Welding Continuous Bright Annealing Furnace SupplierBusiness Ltd 2009 327 Antistick Coating - Silicone, Teflon, Aluminum, MoS2
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Tool & Die Maintenance Tool Room
New Product Developments In 2006, Victor Gaskets developed three multi-layer steel head gaskets for single cylinder and four cylinder applications. Also in 2006, Victor Gaskets independently developed elastomers on metal carriers for cylinder head gaskets with firing pressure 240 bar. Financial Overview In the financial year ended 31 March 2011, Victor Gaskets registered an 22.2% increase in sales with total sales of INR555.9m (USD11.1m, 31 March 2011) compared to INR454.6m (USD9.1m, 31 March 2010) in 2010. Profit before tax was INR68.2m, as compared to INR31.8m last year, which represents an increase of 115%. Net income rose significantly from INR20.8m last year to INR46.5m in the year ended 31 March 2011. Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007 Net Sales (INRm) 555.9 454.6 338.7 330.8 Net Sales (USDm) 11.1 9.1 6.7 6.6 Profit Before Tax (INRm) 68.2 31.8 5.1 15.8 Profit Before Tax (USDm) 1.3 636,036 102,006 316,018 Net Income (INRm) 46.5 20.8 2.7 10.1 Net Income (USDm) 930,052 416,023 54,003 202,011 -
Outlook Victor Gasket has set itself an ambitious target in a market with increasing opportunities and competition from new entrants. Most new OEM entrants are setting up assembly units close to Victors present unit giving it start-off advantage, though it remains to be seen if these OEMs would bring along their international partners to the country. The companys continued focus on exports expansion is expected to bring significant improvement in the overall performance of the company in the automotive market.
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Visteon
Interiors, climate, electronic and lighting products
Address Visteon Corporation One Village Centre Drive Van Buren Township Michigan 48111 USA Tel: +1 800 847 8366 Fax: +313 755 7983 Internet: http://www.visteon.com India Office Visteon Automotive India Pvt Ltd. Survey No. 279 Village Maan Taluka Mulshi, Maharashtra Pune India - 411 057 Senior Officers Donald J. Stebbins, Chairman, CEO & President Martin E. Welch III, Executive Vice-President & CFO Steve Meszaros, Vice-President & President, Electronics Product Group Joy M. Greenway, Vice-President & President, Climate Product Group Products Audio, cockpit modules, centre high-mounted stop lamps, centre stack electronics, compressors, consoles, door trims, driver information, engine induction, fluid transport, front lighting, infotainment, heating, ventilation & air-conditioning compressors, instrument panels, lighting control modules, powertrain cooling, powertrain electronics, rear lighting Plants Canada, China (25), Czech Republic (4), France (6), Germany, Hungary, India (4), Japan (2), Mexico (6), Portugal (3), Philippines, South Africa, South Korea (8), Slovakia, Spain (4), Thailand (3), USA Sales Group: USD7.47bn (Year to 31.12.10) Employees Group: 26,500 (31.12.2010)
Visteon is one of the worlds largest automotive component suppliers. The company serves both OEMs and the automotive aftermarket. It supplies climate control, interiors, electronic and lighting products to the industry.
Visteons business is categorised into the following four divisions: Climate: air handling modules, powertrain cooling modules for hybrid and conventional vehicles, heat exchangers, compressors, fluid transport and engine induction systems. Electronics: audio systems and components, infotainment, driver information, powertrain controls and lighting. Interiors: instrument panels, cockpit modules, door trim and floor consoles. Other: fuel products, chassis products, powertrain products, alternators, starters and products for the automotive aftermarket.
In 2010, Visteon derived 20% of its sales from North America, 39% from Europe, and 41% from Asia Visteon has been in India since 1993. The company operates four manufacturing facilities and two engineering centres, employing more than 3,000 people. This includes Climate Systems India a joint-venture with Maruti Suzuki to supply exhaust gas recovery system, fuel delivery modules, heater cores, intercoolers, radiators and engine cooling modules. In addition to climate systems, the company supplies electronics, interior and lighting products to automakers operating in India. In 2010, India contributed 4% to the companys total sales which was 3% in the previous fiscal year. The companys major customers include BMW, Chrysler, Daimler, Ford, General Motors, Honda, Hyundai/Kia, Mazda, Mitsubishi, Nissan, PSA Peugeot Citron, Renault, Toyota and Volkswagen. Ford is one of the largest customers of the company. The company generated 29% of 2010 sales from Hyundai-Kia and 25% from Ford. Recent Developments Corporate strategy Visteon emerged from the bankruptcy protection on 1 October 2010. The company improved its capital structure and reduced its debt by around USD2.1bn to USD600m during the reorganisation process. The companys reorganisation plan was approved by the US bankruptcy court on 31 August 2010. Under the plan, Visteon agreed to borrow up to USD700m in exit financing to emerge from the bankruptcy protection. More than 40 bondholders of the company, including Deutsche Bank Securities and Goldman Sachs, announced it would invest USD300m in Visteon and buy USD950m of shares of the reorganised company. The bondholders now hold a 95% stake in the new Visteon. Moreover, Ford, the former parent of Visteon, agreed to waive USD163m in retiree benefit claims and committed contracts worth USD600 million by 2013. Visteon had filed for bankruptcy protection in May last year with a debt of USD2.7bn. The new balance sheet will allow Visteon to capitalise on growth markets including Asia, eastern Europe and Brazil. The company is now well positioned to improve profitability and sustain growth. The new Visteon will now focus on its four product lines including climate, electronics, interiors and lighting. Visteon continues to take steps to lower its manufacturing costs by increasing its focus on production utilisation and related investment, closure and
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consolidation of facilities and relocation of production to lower cost environments to take further advantage of its global manufacturing footprint. Visteons strategy is focused on lowering manufacturing costs and restructuring its global business by identifying underperforming and non-strategic businesses. In November 2009, the company announced plans to divest three plants in North America located at Lansdale, Pennsylvania (USA), Springfield, Ohio (USA), and Monterrey, (Mexico). Visteon also sold its non-core aftermarket underhood and remanufacturing facilities in North America. In 2008, the company laid off 9,300 manufacturing jobs. Visteon is steadily diversifying its sales with other OEMs to reduce its dependence on Ford for sales. Fords share in Visteons sales decreased steadily from 70% of total product sales in 2004 to 28% in 2009. It has also extended a distribution agreement with Kenwood for South America. The company is looking towards expanding in China, India, Morocco, and Russia. Visteon has a strong foothold in India. It expanded its climate product offering in the country. Visteon and 3M have come together to capitalise on the growing automotive market in India by offering technologies based on customer needs and preferences. Both companies have global expertise in developing consumer-focused original equipment and aftermarket products. The technologies have been integrated in Mahindra & Mahindras XUV 500 that was launched in the Indian market in September 2011. The company gained significant presence in India when it collaborated with Tata AutoComp in 2005. Later, in 2006, Visteon also set up its technical centre in Chennai. However, even though the company is looking to expand its operations in the Asian countries, Visteon also aims to divest its lighting and interiors units to focus on other faster-growing operations in the region. In February 2012, the company announced a possible divestment of its lighting business to an Indian supplier, Varroc Group. Investment In September 2006, Visteon opened a technical centre in Chennai (India) with an investment of USD10m. The 0.1 million ft2 facility develops electronic modules for audio products. Divestments In February 2012, Visteon announced a possible divestment of its lighting unit to an Indian supplier, Varroc Group. An agreement is expected to be reached by end of February 2012. The divestment valuation is expected to be between USD75m and USD100m. In September 2007, Visteon completed the sale of Visteon Powertrain Control Systems India (VPCSI) to Adyar River Ltd. The agreement includes VPCSI operations in Chennai (India) which produces starters and alternators for global car makers. This divestment was part of the companys restructuring operations to focus on its key products and core technologies. Contracts Visteon supplies audio infotainment system with a 5.8-inch touchscreen, fully-automatic heating, ventilation and air-conditioning (HVAC) systems, light-emitting diode (LED)-based poly-ellipsoid system (PES) headlamps and tail lamps to Mahindra & Mahindra's XUV 500 in India. The vehicle was launched in the Indian market in September 2011. Brand/OEM Mahindra Tata Hyundai Model XUV 500 Nano, Aria i10 Components A/C compressor, engine cooling, front lights, rear lights, HVAC systems, audio infotainment system, radiator Air induction system, door trim, air intake manifold A/C compressor, engine cooling module, A/C lines, HVAC systems, instrument cluster, instrument panel
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New Product Developments During 2010, Visteon spent USD353m on research and development activities compared with USD328m in the previous year. In March 2011, Visteon, along with 3M, showcased its latest technology demonstration vehicle, the C-Beyond for automotive manufacturers in India. Both companies collaborated on a Growth Market Project and demonstrated the vehicle after undertaking research on consumer preferences in India. The latest vehicle integrates advanced features and innovations suiting the requirements of drivers and vehicle manufacturers in the country. The vehicle features more than 40 innovative technologies in climate systems, infotainment and connectivity and interior and exterior lighting.
Financial Overview In the financial year ended 31 December 2011 Visteon reported a 9.8% increase in sales to USD8bn compared with USD7.5bn a year ago. Despite increase in sales the company witnessed decline in its operating income remarkably from USD1.27bn to USD166m and net income from USD1bn to USD80m. In 2010, Visteon has reported higher new income due to one-time gain related to its restructuring. Segment wise, Climate sales increased 9.6% to USD4bn, Electronics sales grew 10.5% to USD1.4bn, sales in Interiors rose 6.6% to USD2.3bn and Lighting sales inched up 3.5% to USD531m. Region wise, sales in North America decreased 8.4% to USD1.4bn, European sales increased 9.5% to USD3.1bn while sales in Asia grew 15% to USD3.6bn. The company does not publish India specific performance but disclosed that it generated 4% of 2011 sales from the country. Year Net Sales (USDm) 8,047
7,466 6,685 9,544 11, 275
Operating Income (USDm) 166

1,275 290 (403) (168)
Net Income (USDm) 80

1,026 128 (681) (372)
R& D Expenditure (USDm) 326

353 328 434 510

26,500 29,500 33,500 41,500
2011
2010 2009 2008 2007
Outlook Visteons effort to locate more of its business in Asia-Pacific is expected to develop its market presence and win new contracts from OEMs in these areas. The company had anticipated Asia to be the major sales driver for the company in 2010 which it achieved. In 2010, sales from Asia contributed 41.4% to the companys total sales. The companys increased investments in Asia were said to help offset its declining automotive sales in Europe and North America, especially in light of rapidly expanding auto demand in the region. In the guidance released by Visteon in January 2012, the company plans to invest further in the emerging markets. The company plans to sell two of its four units in order to pare low-margin revenue and focus on faster-growing operations in Asia. Visteon aims to divest its lighting and interiors units to other suppliers. The two divisions brought in about USD2.7bn in revenue in 2010.
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WABCO India
Automotive and other components
Address WABCO India Limited Plot No. 3 (SP), III Main Road Ambattur Industrial Estate Chennai 600 058 Tamil Nadu India Tel: +91 44 4224 2000 Fax: +91 44 3090 2609 Internet: http://www.wabco-auto.com/ Senior Officers M Lakshaminarayan, Chairman P Kaniappan, President, Whole-time Director TS Rajagopalan, CFO R Madhavan, General Manager, Finance and Secretary Products Actuators, air compressors, anti-lock braking system (ABS), automatic slack adjusters, brake chambers, clutch control, drying and distribution unit, electronically controlled air suspension (ECAS), electronic braking system (EBS), integrated pedal unit, lift axle control valves, OptiDrive, valves Plants India (3): Jharkhand, Tamil Nadu (2) Sales INR8.7bn (USD191.2m, 31 March 2011) (Year to 31.03.11) Employees 1,108 (March 2011)
WABCO India, a subsidiary of WABCO Holdings, is a major supplier of conventional and advanced braking system components in India. The company also supplies other chassis system components such as air suspension and lift axles control valves for the automotive industry.
WABCO India, up until recently known as TVS-WABCO India, was established as a joint-venture between TVS Group and WABCO Holdings. The JV commenced operations in 1962. Over the past 50 years the company has become a major supplier of both conventional and advanced brake systems for the commercial vehicles. In June 2009, the Indian partner, the TVS Group, decided to exit from the JV. Under the agreement WABCO acquired a 35.83% equity stake of the TVS Group. Although post divesture the TVS Group allowed the company to use the trademark TVS in its corporate name and products for a period of three years (June 2012), TVS-WABCO changed its name to WABCO India in 2011. Presently, WABCO Holdings owns 75% in WABCO India. WABCO India currently operates three manufacturing facilities in India, of which two are located in Tamil Nadu and one in Jharkhand. The company is setting up its fourth manufacturing plant in Lucknow, Uttar Pradesh (India) to supply Tata Motors. As of 31 March 2011, the company employs 1,100 people. The companys major customers in India are commercial vehicle manufacturers. WABCO India supplies to Ashok Leyland, Caterpillar, Eicher, Force, Mahindra& Mahindra, SML Isuzu, TAFE, Tata Motors and Volvo Trucks. Recent Developments Corporate Strategy: WABCO is expanding its presence in India after buying out the TVS Group stake. The company is introducing new products in the Indian market leveraging strong research and development (R&D) capabilities of its parent company. The company is introducing several advanced brake system technologies for automakers operating in India including anti-lock braking system (ABS), electronically controlled air suspension (ECAS) and electronic braking system (EBS). In September 2010, WABCO Holdings, the parent company of WABCO India announced plans to expand the current application of OptiDrive transmission technology on heavy-duty vehicles to cover medium-duty trucks and buses in India. OptiDrive optimises gear shifting, thus improving vehicle control and safety while enhancing driver's effectiveness. The technology also helps to reduce fuel consumption and emissions. The company will supply its modular automated manual transmission (AMT) technology to Ashok Leyland, India's second largest commercial vehicle manufacturer. In addition to introducing several advanced barking system components, WABCO India is investing in ramping up capacities to meet strong demand from its customers in India. In September 2011 WABCO India announced it would invest INR600m (USD12.3m, 22 September 2011) in capacity expansion. Of this total, the company will invest INR400m (USD8.1m) in expanding capacity at its manufacturing plant located in Mahindra World City Special Economic Zone (SEZ) in Chennai, Tamil Nadu (India). Investments In September 2011, WABCO India announced it would invest INR600m (USD12.3m, 22 September 2011) in capacity expansion. Of this total, the company will invest INR400m (USD8.1m) in expanding capacity at it manufacturing plant located in Mahindra World City Special Economic Zone (SEZ) in Chennai, Tamil Nadu (India). The company will invest
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INR100m (USD2m) in setting up an assembly plant in Lucknow, Uttar Pradesh (India) which is expected to become operational in financial year 2013. The assembly plant will cater to Ashok Leyland and Tata Motors. The company will use the remaining amount for other purposes. In June 2008, TVS-WABCO commissioned a new manufacturing plant in Mahindra World City special economic zone (SEZ). The plant manufactures crankshafts, crankcases and vacuum pumps for commercial vehicles. In 2007, TVS-WABCO commenced production at its new manufacturing plant in Jamshedpur, Jharkhand (India). The plant supplies brake chambers, spring brake actuators and other braking aggregate parts to Tata Motors. The plant employs 150 people.
Divestment In June 2009, WABCO transferred its stake in Sundaram Clayton Limited, A TVS Groups company to the Indian partners. Contracts In September 2010, WABCO India commenced supplying automated manual transmission (AMT) technology to Ashok Leyland. Earlier in August 2009, the company signed a five-year agreement with Ashok Leyland for the development of transmission automation technology and the long-term supply of automated manual transmission (AMT) systems from 2010 through to 2015. In February 2010, WABCO entered into an agreement with Mahindra Navistar Automotive Limited (MNAL) for the development and supply of air compressor technology, clutch servo technology and products for braking systems. WABCO secured the contract through its Indian subsidiary, WABCO India. The series production of these technologies began in 2010. In 2009, WABCO India started supplying OptiDrive transmission systems to Ashok Leyland Certificates WABCO India was the second company outside Japan to win Deming Prize. New Product Development WABCO India invested INR105.5m (USD2.3m, 31 March 2011) in research and development (R&D) in the financial year ended 31 March 2011. This represents 1.2% of the company sales during the financial year. WABCO Indias leverages strong R&D capabilities of its parent company, WABCO Holdings. During the financial year WABCO India developed air cylinder and mounting bracket assembly for light commercial vehicles for operating hydraulic brakes. The company also developed integral pedal units for Indian customers. The company is currently working on the development of lift axle control systems for the Indian market. WABCO India is also engaged in design and development of hydraulic brake booster and park brake modules for North American OEMs. Financial Overview In the financial year ended 31 March 2011, WABCO India reported net sales of INR8.7bn (USD191.2m, 31 March 2011), an increase of 46.8% from INR5.9bn (USD131.3m, 31 March 2010) in the previous year. The company benefited from the continued recovery in demand of commercial vehicle following the global economic slowdown. Higher sales led WABCO India to record a 61.7% increase in profit before tax (PBT) to INR1.9bn (USD42.1m) compared with INR1.2bn (USD26.3m) in the previous financial year. The company concluded the financial year with net profit of INR1.3bn (USD28.1m) over INR781.9m (USD17.4m) in 2010. Year 2011 2010 2009 2008 Net Sales (INRm) 8,678.0 5,912.6 4,259.5 5,343.4 Profit Before Tax (INRm) 1,913.7 1,183.3 525.5 1,043.7 Net Profit (INRm) 1,274.3 781.9 355.2 698.4
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Year 2011 2010 2009 2008
Net Sales (USDm) 191.2 131.3 81.6 133.9
Profit Before Tax (USDm) 42.1 26.3 10.1 26.2
Net Profit (USDm) 28.1 17.4 6.8 17.5
Outlook WABCO has consolidated its business in India at a time when the commercial vehicle market is recording strong growth. The company is leveraging its strong R&D capability to introduce several pioneering technologies in India. WABCO expects the Indian automotive market to create growth opportunities through increased content per vehicle by introducing new products and technology in automated manual transmissions (AMT), electronically controlled air suspension (ECAS) clutch actuation systems. In addition, the company expects that regulations which require mandatory fitment will push demand for advanced braking system technology in India. For example in October 2006, the government of India introduced regulations for mandatory fitment of anti-lock braking system (ABS) for commercial vehicles carrying hazardous goods. This mandatory fitment was further expanded to tractor-trailers and buses with with national permit and hilly terrains from October 2007. WABCO India has been meeting its parent companys global requirements through its manufacturing plant in Mahindra World City Special Economic Zone (SEZ). The company expects inter-company export sales to increase in coming years. With the revival of demand in the global automotive market, the company expects business opportunities for the plant to grow exponentially. Keeping this in mind, the company is investing in ramping up capacity expansion at the manufacturing plant.
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Wheels India
Wheels & air-suspension systems
Address
Wheels India Limited Padi Chennai- 600 050 Tamil Nadu India Tel: +91 44 2625 8511 Fax: +91 44 2625 7121 Internet: http://www.wheelsindia.com
Senior Officers S Ram, Chairman Srivats Ram, Managing Director S Srivathsan, President, Finance & Secretary Products Air suspension systems, wheels, wire wheels Plants India (8): Haryana, Maharashtra (2), Tamil Nadu (3), Uttarakhand, Uttar Pradesh
Wheels India is the largest manufacturer of automotive wheel rims in India with market share of 66%. The company manufactures wheel rims for passenger cars, utility vehicles, commercial vehicles and farm tractors. The company also manufactures air suspension systems for buses under the brand name TVS-Wilride.
Wheels India was established in 1960 by TVS & Sons, Sundaram Finance, Southern Roadways and Dunlop Holding UK. In 1999, Titan Europe Plc. acquired Dunlop's share in Wheels India. As on 30 June 2011, TVS Groups h eld 49.7% and Titan Europe a 35.9% stake in the company. The company operates eight production plants across India and employs around 1,930 people. Of these eight, the company has three in Tamil Nadu, two in Maharashtra and one each in Haryana, Uttarakhand and Uttar Pradesh. Wheels India has a significant presence in the Indian automotive market with 66% market share. The company has a commanding 78% market share in the commercial vehicle sector and enjoys a near monopoly in tractor wheels market in India. The companys main customers in India are Ashok Leyland, Ford India, Hindustan Motors, Honda Siel, Hyundai Motors, Maruti Suzuki, Tata Motors and Toyota Kirloskar. The company is a sole supplier to Ashok Leyland and meets 60% of requirement of Tata Motors. In the export market, Wheels India supplies Caterpillar and Daewoo Heavy Industries. The company exports about 18% of its total sales, to North America, Europe, Asia-Pacific and South Africa. Recent Developments Corporate strategy Wheels India continues to strengthen its presence in its core business of wheels. The company, which is a major player in the commercial vehicle segment, has recently entered into a technological agreement with Japan-based Topy Industries to design and develop wheels for passenger cars for global customers. The technical alliance with Japans Topy is expected to help the Indian wheel supplier attain the quality standard of the latter and secure contracts from global automakers. In addition, Wheels India is ramping up wheel production capacity to meet expected surge in both domestic demand and exports. The company is investing INR70m (USD1.5m, 31 March 2011) to expand production capacity at its six manufacturing plants in India to 15 million wheels by 2012 compared with 12 million in 2011. Wheels India is foraying into air suspension business for trucks and trailers. The company has so far focused on air suspension for buses but is now gradually shifting focus to trucks and trailer segments. Wheels India is trying to create a demand in this segment. In addition, the company is diversifying into ambulance systems. Besides automotive, the company is also diversifying its non-automotive business in thue power sector. The company has invested INR250m (USD5.5m) and established a manufacturing plant in Wardha, Maharashtra (India). Initially, Wheels India plans to produce structurals like auto-weld beams, boxes, columns and girders for large boilers made by some of the biggest power plant suppliers. Joint Ventures In November 2011, Wheels India entered into a technological agreement with Japan-based Topy Industries to design and develop wheels for passenger cars for global customers. The technical alliance with Japans Topy is expected to help the Indian wheel supplier attain the quality
Sales
Employees
c. 1,930 ( 31 March 2011)
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standard of the latter and secure contracts from global automakers. In January 2008, Wheels India decided to invest a sum of INR73.5m (USD1.86m, 31 January 2008) in the paid-up capital of Sundaram Hydraulics Ltd, a project to be set up jointly with Sundaram Finance Ltd, for the manufacture of hydraulic cylinders. Wheels India and Sundaram Finance Ltd were to hold a stake of 49% each in the paid-up capital of Sundaram Hydraulics Ltd.
Investments In 2009, Wheels India established a plant at Pant Nagar, Uttrakhand (India) to serve the nearby Tata Motors mini-truck plant and other customers. In October 2007, Wheels India opened a facility Sriperumbudur near Chennai (India) at a cost of INR320m (USD8.1m, 31 October 2007) to produce larger wheels for high-capacity dumping trucks and earthmoving equipment. The new facility had an initial capacity of 7,000 units of large wheels for mining trucks, with the provision to increase the capacity to 18,000 wheels in 2010.
Contracts Wheels India is the sole supplier to Ashok Leyland. Wheels India supplies wheel rims to Ford India, Honda Siel, Hyundai Motors, Tata Motors and Maruti Suzuki.
Certification Wheels India is accredited with ISO/TS 16949:2010 certification. Wheels India plant in Pune, Maharashtra (India) is accredited with QS 9000-1998 and its Padi, Tamil Nadu (also in India) plant received ISO 9001 and ISO14001:2004 certification. New Product Development: Wheels India invested INR76.6m (USD1.7m) on research and development (R&D) in the financial year ended 31 March 2011 compared with INR59.2m (USD1.3m) in the preceding year. The company has technical and financial agreement with Titan Europe. In November 2011, Wheels India entered into another technical agreement with Topy Industries to design and develop wheels for passenger cars for global customers. Financial Overview In the financial year ended 31 March 2011 Wheels India reported a 35.5% increase in net sales to INR16.8bn (USD369.2m, 31 March 2011) compared with INR12.4bn (USD275.6m, 31 March 2010) in 2010. The company benefited from strong demand in the domestic market. This led the company to stretch its production capacity in the last two months of the financial year, producing more than a million wheels a month. The company also benefited from recovery in off-the-road (OTR) segment in earthmoving and mining equipment markets. In addition, Wheels India also gained from strong growth in exports which more than doubled to INR2.4bn (USD52.8m) over INR1.1bn (USD24.9m) a year ago. Higher sales led the company to record a 61% increase in profit before tax to INR325.8m (USD7.2m) over INR202.3m (USD4.5m) in the previous financial year. The company concluded the financial year with net profit of INR246.4m (USD5.4m), up 90.3% over INR29.5m (USD2.9m) in 2010.
Year 2011 2010 2009 2008 2007
Net Sales (INRm) 16,760.7 12,413.8 11,280.2 11,302.1 10,032.7
Profit Before Tax (INRm) 325.8 202.3 294.2 397.4 386.9
Net Profit (INRm) 246.4 129.5 211.5 258.6 260.3
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Year 2011 2010 2009 2008 2007
Net Sales (USDm) 369.2 275.7 216.2 283.3 230.9
Net Profit (USDm) 1.7 2.9 4.0 2.6 1.1
Outlook Wheels India is the market leader in almost all segments and has therefore grown with the increase in domestic vehicles sales. The companys exports are expected to grow in 2012, although not at the same pace as in the previous year. The companys initiatives to ramp up capacity are expected to help it meet surging demand in the medium to long term. Wheel India aims to keep itself fully prepared for the next phase of growth, so as not to be caught short by sudden increase in demand as happened two years ago. Wheels Indias strategy to diversify within and outside automotive industry is expected to reduce its dependence on one product line or segment for future growth. This is also expected to open new avenues for growth at the company.
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ZF India
Mechanical and power steering gears
Address
ZF Steering Gear India Ltd ICC Towers, A-Wing, 6th Floor Senapati Bapat Road Shivaji Nagar, Dist - Pune 411016
ZF in India operates through its completely owned plants as well as its joint-ventures. One of the JVs, ZF Steering Gear India Limited (ZFSGIL), is the largest manufacturer of steering gear systems in India with market leadership in the commercial vehicle segment.
The parent company, ZF Friedrichshafen AG is a worldwide automotive supplier of driveline and chassis technology and has 121 production companies across 27 countries and eight main development centers. The company operates in India through its JV with Somic Ishikawa of Japan in Gurgaon, Haryana. The JV is named Sona Somic Lemforder Components Ltd which manufactures ball joints for steering systems and suspension components. ZF has another JV with Hero Motors named ZF Hero Chassis Systems Pvt. Ltd, a supplier of car chassis technology. The JV is headquartered at New Delhi and has two high-tech plants, one in Vadodra and another one at Pune. The third JV is with TVS Group named ZF Electronics TVS Private Ltd in Madurai which produces precision snap action switches, sensors and electromechanical assemblies. Another JV, ZFSGIL came into being in 1981 as a three-way joint-venture between Zahnradfabrik Friedrichshafen AG (ZF AG), the Firodias of Force Motors and the Munot family as a mechanical steering gear and hydraulic power steering gear manufacturer. The companys product range includes ball and nut integral hydraulic power steering gears for heavy commercial vehicles, integral hydraulic power steering gears for medium and light commercial vehicles, power steering gears for suburban vehicle (SUV) and off road vehicles, vane pumps, oil reservoirs, worm and roller mechanical steering systems and all accessories for tractor and light commercial vehicles, power rack and pinion steering system for passenger car and mechanical rack and pinion steering system. During the fiscal year ended 31 March 2011 (fiscal 2011), the company produced 201,038 hydraulic power steering gears, including components/spares and 155,870 mechanical steering gears, including components/spares. ZF Steering Gear's customers for power steering gears include Tata Motors, Daimler, Force Motors, Ashok Leyland, Eicher Motors, Swaraj Mazda, Tatra Udhyog, Vehicle Factory, Asia Motor, MAN-Force Trucks, Mahindra Navistar and Volvo India. The company's customers for mechanical steering gears include Force Motors, Eicher Tractors, Escorts, International Tractors, Mahindra & Mahindra, New Holland Tractors, Punjab Tractors, Standard Tractors, Action Construction Equipment, and SAME Tractors. .
Tel: ++ 91 020 30211600 Fax: +91 020 30211699 Internet: http://www.zfindia.com Senior Officers
D.S Bomrah, DirectorDinesh Munot, Chairman & Managing Director Jinendra Munot, Joint Managing Director Utkarsh Munot , Executive Director
Products
Mechanical worm and power steering gears and Integral hydraulic power steering gear, intermediate shafts, universal joints, bevel gear boxes, worm and roller mechanical steering systems, power rack and pinion steering system, vane pumps, pump pulleys, pump mounting brackets
Plants
Pune (5), Gurgaon, Madurai, Vadodra
Sales
ZF Global sales: EUR15.5bn (USD20.1bn, 16 December 2011)
ZFSGIL: INR2.9bn (USD60m, 31 March 2011) (Year to 31.03.11)
Employees
ZFSGIL: c. 909 (31 March 2011)
Recent Developments
Corporate strategy Over the last three years ZF India has seen improved sales on account of a ruling which mandated the use of power steering on all commercial vehicles. ZFs case was further bolstered by a sharp increase in demand for commercial vehicles. The company expanded its installed capacity of power steering gears to three lacs units per annum and mechanical steering gears to 2lacs unit per annum at its existing facility at Vadu Budruk, Pune in the financial year 2010-11. Following its growth plans, the company established a new facility in Pune, Maharashtra to manufacture heavy trucks transmissions. ZF is looking to strengthen its product portfolio and established its axles and transmission systems production facility in Chakan, Pune. ZFs recent acquisition of Hero Chassis Systems in March 2010 is in line with the companys growth strategy to increase its footprint in chassis frames, axle systems and sheet metal component market. ZF has been focusing on passenger cars, and with this in mind it entered into an agreement with ZF Germany and ZF Shanghai. The company has
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managed to indigenize certain key components which it claims will help beat margin pressures. Acquisitions In March 2010, ZF acquired a 50% stake in India-based Hero Chassis Systems, a component business unit of Hero Motors Ltd. Post acquisition, the business became a joint-venture with both ZF and Hero holding a stake of 50% each and its name was changed to ZF Hero Chassis Systems. The JV has two manufacturing facilities in Halol, Gujarat and Talegaon, Maharashtra, acquired in 2008 from Delphi. The company is planning to set up two new facilities in near New Delhi and Chennai (both in India) by 2012, increasing the capacity to 400,000 units a year from the current 160,000. In September 2010, the JV announced plans to invest around INR49.6bn (USD1bn, 31 March 2010) in a new plant near New Delhi to manufacture chassis frames, axle systems and sheet metal components. The components manufactured will primarily cater to local demand. Lemfrder acquired a 26% share in the renamed Sona-Somic-Lemfrder Ltd., which produces chassis components for the Indian automotive industry. Joint-ventures ZFSGIL has a technical alliance with ZF Germany. Investments In October 2010, ZF opened a new plant in Pune, Maharashtra (India). The plant has capacity to produce up to 25,000 ZF-Ecomid 9-speed heavy truck transmissions annually. Depending on the demand, the company can produce other truck transmission types for its current customers, including Asia Motor Works, Tata Motors, Ashok Leyland, Mahindra Navistar and Volvo-Eicher, as well as new customers. Initially the company employed 80 employees in the truck transmission assembly plant. After production ramp-up the figure is likely to go up to 150 over the next five years. In January 2010, ZF group inaugurated its axles and transmission systems production facility in Chakan, Pune (India). The facility is the first for ZF India, a subsidiary of ZF group and it will produce components for offroad applications and will also supply to the upcoming transmission plant in Ranjangaon, Maharashtra (India) for trucks. The plant will produce 10,000 axles and 10,000 powershift transmission units per annum. The company is targeting INR13.1bn (USD264.7m, 31 January 2010) worth sales through the plant by 2013. Contracts Currently ZFSGIL is working on new programs being conducted by some of its existing clients like Tata Motors for the World Truck platform, Force Motors for the MAN trucks and Ashok Leyland for the Newgen series. ZFSGIL supplies mechanical steering gears for Force Motors Matador, Minidor, Traveller and Trax Phase 1.5. The company also supplies mechanical steering gears to certain tractor manufacturers. Also, ZFSGIL supplies power steering gear to truck and bus manufacturers like Ashok Leyland for its 2214, 2516 Taurus, Special Viking, Viking Super, Cheetah, Hippo dumper, ALRD20 dumper; Autorola for its buses; Eicher Motors for its Canter 10.9 and school bus; Swaraj Mazda for the T1100 and the Minibus,; Tata Motors for its LPT 4021TC, LPT 3516 TC, LPT 2516 TC, LPT 1512 TC, LPT 1510 TC, LP 1510 TC, 1109TC, 609, 407, Sumo Diesel, Safari and the Sierra; Volvo India for the FH12.
New Product Developments ZFSGIL is preparing to enter the passenger car

segment with technical back-up from ZF China and ZF India.
Financial Overview ZF Group has posted record sales of EUR15.5bn

(USD20.1bn, 16 December 2011), marking a 20% increase on a year-on-year (y/y) basis, in 2011. Region wise, ZF expects more than 40% sales increase in North America, around 30% increase in eastern Europe and 20% in Europe as a whole. The company generated 15% sales from South America and 10% of its total sales came from Asia-Pacific. In the financial year ended 31 March 2011, ZFSGILs sales increased 3.8% to INR2.9bn (USD60m, 31 March 2011) as compared with INR2.1bn (USD43.5m, 31
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March 2010). Operating profit declined 20.3% to INR582.3m (USD11.7m, 31 March 2011) against INR412.9m (USD8.3m, 31 March 2010), whereas, the net profit for the year ended 31 March 2011 increased marginally to INR409m (USD8.2m, 31 March 2011) as compared with INR286.6m (USD5.7m, 31 March 2010).
Year 2011 2010 2009 2008 2007 Year 2011 2010 2009 2008 2007
Net Sales (INRm) 2.982 2.161 1.661 2.226 2.16 Net Sales (USDbn) 60 43.5 33.4 44.8 43.7
Operating Income (INRm) 582.3 412.9 217.9 503.60 507.83 Operating Income (USDm) 11.7 8.3 4.3 10.1 10.2
Net Income (INRm) 409 286.6 143.1 278.53 275.59 Net Income (USDm) 8.2 5.7 2.8 5.6 5.5
Outlook Since the automotive paradigm is shifting from Europe to emerging

markets like India; the company has increased its activities towards strengthening its presence in the Indian market. Though the company is facing the challenge of nonavailability of adequate skilled manpower and increased wage bill, it is positive about its full year outlook for 2011-12. With the expansion of its existing Pune facility and plans for opening new facilities near New Delhi and Chennai through its JV, the company will further continue to penetrate the steering gears market in India.
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SupplierBusiness

The Indian Supplier Report

The Indian Supplier Report

The Indian Supplier Report

2012 IHS Global Inc.

The Indian Supplier Report

2012 IHS Global Inc.

The Indian Supplier Report

2012 IHS Global Inc.

The Indian Supplier Report

2012 IHS Global Inc.

The Indian Supplier Report

2012 IHS Global Inc.

The Indian Supplier Report

LIST OF FIGURES AND TABLES

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THE INDIAN AUTOMOTIVE INDUSTRY

Figures for financial year ended 31 December; Source: IHS Automotive

The Indian Supplier Report

EVOLUTION OF INDIAN AUTOMOTIVE INDUSTRY

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The Indian Supplier Report

Passenger Vehicles Two Wheelers

Commercial Vehicles Three Wheelers

Passenger Vehicles Two Wheelers

Commercial Vehicles Three Wheelers

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Figure 3: Two-wheeler Sales and Production in India (2004-2011)

Figures for year ending 31 March; Source: SIAM

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Figure 4: Three-wheeler Sales and Production in India (2004-2011)

Figures for year ending 31 March; Source: SIAM

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Figure 5: Indian Light Vehicle Sales

The Indian Supplier Report

Figures for year ending 31 December 2011; Source: IHS Automotive

A Segment B Segment C Segment D Segment E Segment F Segment HVAN Segment

The Indian Supplier Report

The Indian Supplier Report

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Figure 9: India Light Vehicles Sales Forecast

Figures for year ending 31 December; Source: IHS Automotive

Medium and heavy duty commercial vehicle

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Figure 13: Indian Vehicle Exports (2004-2011)

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GROWING COMPETITION IN ALL SEGMENTS