The $2-billion-plus Anand Group, a leading manufacturer of world-class auto systems and components, has signed a joint venture (JV) with Korea’s $8.1-billion HL Group. The JV will increase the size of the Indian conglomerate’s aftermarket business two-fold while building the Korean entity’s presence in India.

The JV will expand the aftermarket portfolio with products manufactured by Anand’s existing JVs with HL Group’s Mando Corporation, an automotive components leader based in Korea. These existing partnerships are HL Mando Anand Automotive, which makes steering, brake, and suspension systems, and Anand Mando eMobility, which manufactures motors and controllers for EVs. 

The partnership will be called ‘HL Anand Automotive Parts Pvt Ltd’ and provide a wide range of aftermarket components for the passenger vehicle segment in domestic and international markets. Two dedicated distribution centres will be set up for the new company in the next two years.

The Seoul-based HL Group consists of 44 companies across Asia, North America, Europe, the Middle East, and South America.

Speaking about the new JV, Mahendra Goyal, co-COO of Anand Group, said: “At Anand, we have a special focus on the aftermarket business and want to grow ahead of market. This strategic JV with HL Group will significantly expand our aftermarket business in both domestic and international markets. The JV will capitalise on the strong ANAND Group aftermarket ecosystem in India and HL Group’s sourcing expertise and well-established global network.”

He added, “With this alliance, we expect our aftermarket business to grow at a CAGR of 15% over the next five years. The company will focus on the core products manufactured by the existing JV entities and will be free to source other products, as feasible, for growth. This JV will be selling HL Mando and Anand co-branded products, building on the brand strengths of both partners."

The Anand Group’s basket of aftermarket products comprising of around 6,000 SKUs are well distributed by over 2,500 industry-leading channel partners and nine distribution centres located across the country. The JV further plans to add around 1,200 new SKUs in the next two years."

Speaking about the JV,  Joon-Bom Kim, CEO of HL Holdings, who signed the agreement at Anand’s New Delhi corporate headquarters late on Tuesday, with Mr. Goyal, said: “Anand Group is a highly respected auto leader in India. The coming together of HL Group, a visionary industry leader in Korea with an extensive global presence in auto and other sectors, and Anand, with its India-wide aftermarkets network, will be a positive for both businesses and help expand the opportunity-rich Indian aftermarket sector overall.”

India’s auto aftermarket, which is growing at around 10% annually, is approximately Rs 85,000 crore ($10.6 billion), while the global aftermarket is estimated at around $408 billion, according to industry reports.