Automotive cable maker Suprajit Engineering, which on Monday announced the acquisition of the non-core speedo cable business of Pricol, has also got land from the Tamil Nadu Government recently for setting up a plant in Oragadam, near Chennai.
The facility, to be its first in Tamil Nadu, is part of an expansion plan pursued by the company under which the installed capacity will increase to 210 million cables from 150 million cables annually now.
Another component of the plan, involving Rs.60-70 crore capital expenditure over next 18 months, is adding capacity at the Biwadi plant in Rajasthan. The company, whose turnover was around Rs.600 crore last fiscal, has 13 plants across the country, making a range of automotive cables. It also has a non-automotive EOU plant.
“We got four acres in Oragadam from the Tamil Nadu Government under the single window [clearance] process a few days ago,” Chairman and Managing Director Ajith Rai told The Hindu . The investment on the plant would be Rs.15-20 crore, he said, adding that it would serve customers in Tamil Nadu, including TVS Motors, Ashok Leyland, TAFE, Hyundai and Ford. Many of them were being supplied from one of its seven plants in Bangalore.
On Pricol’s speedo cable business, whose annual sales are around Rs.10 crore, he said it would “add to our strength of being number one in cable business.” At present, it catered to leading OEMs such as M&M, Tata Motors, Eicher… “they will eventually be transferred to us.”
In a BSE filing, Suprajit Engineering said it has executed a business transfer agreement with Pricol, Coimbatore, for acquisition of the business on a slump sale basis. Suprajit is in the process of transferring the plant and machinery to the Bommasandra industrial area, where it has a plant. Refusing to divulge financial details of the acquisition, he said: “We are using a small portion of the liquid cash of Rs.80-90 crore in hand.”
