Birla Auto plans investing Rs 90 cr in components manufacture

Mumbai: Birla Auto & Engineering Group, which comprises Birla Precision Technologies, Birla Peruchinni, Indian Tool Manufacturers (ITM) and Dagger Forst, announced that the company will invest Rs 90 crore in auto component manufacturing.

The company is looking for external funding and raising money from the stock market for its expansion plan.

“With these investments, which will happen in 15 months, we target to raise the annual revenue to Rs 400 crore by 2009 from the current Rs 200 crore,” said Mr Praveen Gupta, Chief Executive of Auto & Engineering Business, Yash Birla Group.

The four group companies manufacturing precision machined tooling, tool holders, castings, broaches and gear cutting tools still remain legally independent entities.

Integration

“We are looking at the prospects of integrating all four companies. An external consultancy is entrusted with the task of studying the pros and cons of restructuring the company. We will do it if it makes business sense,” said Mr Gupta. The group has recently bagged contracts from auto industry majors such as Bosch and Tata Motors.

Kennametal buy-out

The Yash Birla Group had earlier bought complete stake in Birla Kennametal, which was originally a joint venture with the US-based Kennametal, and rechristened the company as Birla Precision Technologies.

“About 40 per cent of the current year’s revenue was from exports, mainly to the US. Our revenue per customer is continuously increasing,” said Mr Gupta.