Freudenberg Group to invest Rs 111 crore in sealing solutions plant in Chennai

The Freudenberg Group, which has recorded profitable growth in 2016 despite challenging conditions in multiple market segments and world regions, has announced a new investment in India.

The global technology group plans to start construction of a new production facility near  Chennai later this year with an investment of 15 million euro (Rs 111 crore). The plant, located in the Vallam-Vadagal Industrial Park, will produce innovative sealing solutions for the automotive industry, among other products.

In 2016, Freudenberg registered global sales of 8.6 billion euros (Rs 63,835 crore), up 13.5 percent compared to 2015. Freudenberg also continued its positive business development in India. “With our plan to invest in a new production facility in the city of Chennai, we underline our long-term commitment to the local market and support the ‘Make in India’ initiative,” said Dr Mohsen Sohi, Freudenberg Group CEO, at a press conference in Bengaluru last week.

In India, Freudenberg’s seven business Groups generated sales of Rs 1,483 crore, an improvement of 20 percent compared to the previous year. Employee numbers rose by 17 percent to 2,475 at around 50 locations in India – with six R&D centres and 14 production sites with state-of-the-art shopfloors. This increase in sales and employees can be attributed to a large extent to the acquisition of Vibracoustic. The Business Group operates production, sales and service sites in India.

“In 2016, Freudenberg invested 8.6 million euros (Rs 62 crore) in India,” said Georg Graf, Freudenberg Regional Representative India. “Investments were made across the board, at all Freudenberg Business Groups, in manufacturing and research facilities and equipment.” Over the past five years Freudenberg has invested a total of Rs 363 crore.

Business outlook for 2017
On the basis of its current assessment, the Freudenberg Group expects global organic growth in sales of between 1.0 and 3.0 percent and profit from operations slightly above the previous year’s figure. Almost all Business Groups are likely to contribute to this performance. On the basis of this forecast, Freudenberg expects stable development in its return on sales. The Freudenberg Group forecasts profitable double-digit growth in India for 2017.