Nirmal Minda, Managing Director, Minda Industries
The managing director of Minda Industries tells P Tharyan how turnover will increase ten-fold in the coming years.
How do you plan to grow your share in the battery business?
It is tough to gain a substantial share in the beginning. The test cycle for the product is 6-8 months. We will be 100 percent with Bajaj Auto in the Pantnagar project in Uttaranchal and will also approach Tata Motors, Hero Honda, Honda and Maruti Udyog for supply of our batteries. As Bajaj is setting up a capacity of one million units, we can supply the same number of batteries to them. Our plant capacity will be 3.8 million batteries for two-wheelers and around seven lakh units for four-wheelers. This can easily be increased if need be.
What would you say about the new valve regulated lead acid batteries?
It is a new technology and is not being used in two-wheelers here. You need not top it with distilled water and this makes it truly a maintenance-free battery. Valve regulated lead acid batteries, which are completely sealed, can be tilted and there will still be no spillage.
Will you be exporting these batteries?
Yes, we have entered into a buyback arrangement with FIAMM of Italy, our technology partners, wherein nearly eight lakh batteries will be shipped back to them. We will kick this off as soon as we begin production and reach the required numbers but the top priority at htgis stage is supplying to Bajaj Auto.
How have you been doing in the complete handlebar assembly business?
We are 100 percent now with Suzuki Motorcycles and supply complete handlebar assemblies to all their three models. The same holds good for Yamaha. This was a new concept offered to us by Bajaj Auto around three years ago. Since manufacturers want to subcontract work, we are getting an opportunity to supply such assemblies. We are also involved with two-wheeler manufacturers at the design stage. Minda has engineers from NID, IIT and also collaborates with such premier institutions.
Your R&D centre has developed self-cancellation blinkers, back-lit switches etc. Have these been accepted by two-wheeler makers?
During the next two months, these products will be produced and fitted in two-wheelers here. These new features will be present on certain bike models for the first time in the world. This new innovation was designed jointly by Minda and Bajaj Auto.
Minda Impco makes CNG engines for trucks and other heavy duty vehicles. Has it got any fresh orders?
We have developed CNG engines for Hino trucks to be made in Pakistan. These are under validation and testing. Maruti Udyog has supported us in a big way with the WagonR LPG model. We plan to supply 2,000 LPG kits to the company this month. For CNG too, we are working on some platforms with Maruti.
Could you run us through your plants?
Minda has 19 manufacturing locations and six plants for the switch division alone. Our new plant in Uttranchal will be located in the Bajaj Auto cluster and will meet its requirements of complete handbar assemblies, batteries and horns. We will make all parts for the company’s two-wheelers at Uttaranchal itself in different blocs. There will, otherwise, be no benefit for Bajaj on the tax front if they procure their parts from Delhi or Pune. As you are aware, we will be among the 16 suppliers to the company at Uttaranchal.
How is the PT Minda Asean venture in Indonesia progressing?
We make switches and key sets and our group products there. We began commercial production last January but the market there has collapsed following the steep increase in gas prices and interest rates. Markets collapsed last year and still have not revived to our expectations. We are still in talks with Sumitomo to pick up a 10-15 percent stake in the company. We have also opened an office in Vietnam which includes a logistics base. Material sent from here is stocked there and from there we ship it to customers on a just-in-time basis.
What is the road ahead for Minda Industries?
Last year, we posted a turnover of Rs 545 crore and expect to touch around Rs 750-770 crore this year. We have set a target of one billion euros (Rs 5,500 crore) for 2014-15. We are also studying certain auto products and will develop them at an appropriate time. Product diversification is also on the anvil. In our product line, we are interested in acquisitions. For this year and next, we have earmarked Rs 250 crore for investments in the group, of which Rs 80 crore will be used for mergers and acquisitions.
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