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US-based auto parts maker Stanadyne is exploring few locations in western and northern India to establish its second plant in the country at an investment of about Rs. 200 crore, said its chief executive officer John Pinson recently.
The company -- which manufactures fuel pumps and fuel injectors for agricultural and commercial vehicles and sells them to automobile companies such as Bajaj Auto, Greaves, TAFE and Simpson -- is planning to triple its sales revenue from the India operation to about Rs. 1,100 crore by 2027, Pinson told Business Standard in an interview.
Stanadynes only plant in India is in Chennai and that employs about 700 people. The revenue coming from the India operation accounts for about 30 per cent of the companys total global revenue, Pinson noted. About 60 per cent of Stanadynes total global revenues come from the US operation.
Interestingly, out of its total India revenues, about 75 per cent come from exports and only about 25 per cent comes from domestic consumption. The Chennai plant currently sends products to companies in countries such as Italy, the US, Mexico, China and Turkey.
"We are exploring a few locations (for the second plant) in the western and northern India for ensuring the manufacturing footprint near the customer locations and better product synergy. We expect to invest around 200 crores for the second plant," Pinson noted.
Stanadyne expects the domestic and export market revenues from the India operation will be 50:50 by 2027 as the domestic demand for its products are rising, he mentioned.
"This (expected domestic growth) is due to the fact that Stanadyne India is gearing-up to launch new products for the Indian emission regulations and these products will start adding to the sales revenue in a phased manner. We will also benefit due to the OEM (original equipment manufacturer) volume growth expected for India. The combined effect will be that the domestic share will contribute 50 per cent," he noted.
Real driving emission (RDE) norms, under which auto companies have to install a self-diagnostic device in their models to monitor emissions real-time, will be implemented in India from April this year. Auto companies will have to incur significant costs to update their models to install these devices.
Stanadyne currently sells its products to companies such as Ashok Leyland, Cooper, John Deere, JCB, Kirloskar, Simpson, TAFE, Cummins, Bajaj Auto, Continental and Greaves. |
