Varroc Engineering, the flagship company of leading auto component manufacturer Varroc group, on Tuesday signed a technology licence agreement with U.K.-based Scorpion Automotive to exclusively design, manufacture and sell licensed security products to two-wheeler and four-wheeler vehicle manufacturers in India. The collaboration will introduce innovative products for the two-wheeler sector in India such as alarms, heated grips, throttle locks and the like.
“We have a strong relationship with original equipment manufacturers (OEMs) in India and this partnership will help us enhance our already diverse product portfolio for them,’’ Varroc Group President (Technology and Strategy) Ravi Damodaran told The Hindu . “This is part of our electrical business growth plan, and the need for these products has not been adequately addressed here.’’
“We are targeting two and three-wheelers, which have a market of around three million units in India, and can reach five million units in 2020 by which time we want a 25 per cent share,’’ he said.
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Its three business divisions of polymers, electrical and metallic contribute equally to the turnover. With revenues of Rs.6,900 crore, about 90 per cent of Varroc’s business is from two-wheelers, and it plans to bring this down to 75 per cent by 2020 with the rest from passenger cars and commercial vehicles. Mr. Damodaran said the company was looking at possible acquisitions in Russia and Brazil.
. “There are no immediate plans for an IPO or fund-raising. We re-invest around Rs. 450 crore in the business annually,’’ he said. Varroc invested Rs. 20 crore in a polymer products plant in Chennai, and expects revenues of Rs.100 crore in two years from the unit. It is setting up a similar Rs.25 crore unit in Gujarat.