Greaves Cotton, supplier of small engines for small and light commercial vehicles (LCVs), has charted out plans for higher growth in the current financial year. The company will launch a 265cc engine for three-wheelers and a 900cc engine for four-wheelers this year.

“Our focus is on growing the business in the four-wheeler sector,” emphasisesSanjiv Kumar, CEO – automotive engine business, Greaves Cotton.

The company’s new thrust on business from four-wheeler OEMs comes as two to three new models are set to be launched in the small commercial vehicles (SCV) and LCV segments during this year. The ongoing healthy growth of the four-wheeler LCV market is attracting Greaves' interest. The segment grew 20 percent during the April-June 2012 quarter to 102,657 units. Currently Greaves Cotton supplies to vehicles like the Tata Ace Zip, Magic Iris and Piaggio’s Ape Truk. “We are looking at bigger engines for the rest of the SCV segment,” Kumar told Autocar Professional. The company, which works with several technology providers, may also look at expanding its range up to a 2.0-litre four-cylinder engine. Greaves has two distinct engine platforms. “We are working on a new range,” says Kumar.

Greaves Cotton recently entered into a seven-year agreement with Atul Auto to be the sole supplier of engines for the latter’s three-wheeler range. It is likely that Atul Auto, which is planning to enter the four-wheeler SCV segment, may source the engine for the vehicles from Greaves Cotton.

Even as sales of three-wheelers are slowing down, Kumar believes the cargo three-wheeler story is far from over. During the April-June 2012 quarter, three-wheeler goods carrier segment sales fell 15 percent to 21,782 units. “We feel there’s a pent-up demand in the market still. The current slowdown is temporary,” says Kumar.

Greaves Cotton also plans to introduce more CNG versions and its engineers are developing a CNG version of the 600 series engine. In its communication to investors, Greaves Cotton says it will invest around Rs 150 crore on enhancing its technology, product development capabilities and complete expansion in its Ranipet plant. Last year, the company had a capex of Rs 105 crore.

During last year, the company’s profitability came under pressure "due to product mix and pricing pressure on certain sectors". The company is also working on increasing its international presence. An alliance or two with global players is also on the cards.

SUMANTRA BAROOAH