Like the way a powertrain moves a vehicle, it is the business of making powertrains that is expected to move Kinetic Engineering Ltd (KEL) in the growth path.
After the Group’s biggest ever business restructuring exercise, Sulajja Firodia Motwani, director, who’s driving the change at the group level, has got her plan laid out. She says, “We will remain focused on powertrain (engine and transmission systems). We are well diversified across two-wheeler (mostly Mahindra 2-Wheelers where we are a key partner and supplier), commercial vehicles, automotive and certain non-automotive programmes. We hope to grow both organically and also hope to explore certain alliance or non-organic growth opportunities.” Results seem to be trickling in as the company posted a net profit of Rs 2.1 crore for the nine-month period that ended March 31, 2010.
KEL, which supplies gearboxes to the Tata Nano project, hopes to grow significantly with the Nano volumes, after some heartburn due to the relocation of the Nano’s production facility.
KEL is also learnt to be on the verge of bagging orders from some global OEMs. Sources say Piaggio and Navistar have selected KEL as a vendor for their international operations. When contacted, Motwani declined to name the customers but said “KEL has added several new clients and programmes in complete transmission assemblies for two leading international companies and we have now completed development of these programes.”
Diversifying into infrastructure
It’s not only the auto component business but Kinetic is gradually spreading its wings to cover other areas like infrastructure also. The JV with Italy’s FG Tecnopolo announced earlier this month is one step towards making further inroads into this sector. The JV partners feel that the Indian infrastructure and construction industry, currently pegged at US$ 115 billion, holds strong potential for it to tap. The infrastructure to set up the centre will be made available to the JV by Kinetic Communications, while the IPR/technology know how will be provided by FGT.
The initial investment will be Rs 1 crore and it may be increased with the business scope growth of the JV. Kinetic and its partner are banking on the ‘tremendous growth in infrastructure, construction, retail and hospitality industry’ that could come over the next 10 years. The JV will also expand the scope of its work to launch other products and services related to infrastructure including traffic management systems and LED solutions for lighting. The engineering centre is likely to have have about 100 engineers in the next three to four years.
Post restructuring, Kinetic has identified non-conventional energy as a long term growth sector. One of the first steps towards this goal is the Soleckshaw – a tricycle driven partly by solar energy and partly by pedal. Kinetic and the Council of Scientific & Industrial Research have jointly applied for a patent to this product. Earlier this month, Sachin Pilot – minister of State for communications and information technology – launched the Soleckshaw (priced at Rs 25,000) which will initially be used by the post offices in Rajasthan. Based on the feedback from the pilot project of 10 Soleckshaws, it may be taken to other markets, and Kinetic may also develop it as a multiple application product.