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Mr A.M. Naik (left), Chairman and Managing Director, Larsen & Toubro Ltd, with Mr A. Ramakrishna, President (Operations) and Deputy Managing Director, at a press conference in Chennai on Friday. - Bijoy Ghosh

Chennai , Oct. 8

LARSEN & Toubro Ltd plans to invest Rs 60-70 crore in expanding its plastic machinery manufacturing unit and in setting up a new plant to manufacture Defence equipment. Both these plants are to come up on the outskirts of Chennai, along the Chennai-Bangalore national highway.

Mr A.M. Naik, Chairman and Managing Director, Larsen & Toubro, told a press conference here on Friday that land for the two projects had been selected and work would commence shortly.

The plants would come up on the national highway beyond the site where the headquarters of ECC (Engineering Construction and Contracts) division of L&T are located.

The plastics machinery manufacturing unit, currently located just opposite the ECC headquarters, will move to a 17-acre site about 10 km from the present location.

The new plant is expected to start functioning in a year. Initially, this plant - L&T-Demag Plastics Machinery Pvt Ltd - will make about 500 machines a year, which will go up to about 1,000 in two to three years.

The turnover will increase from Rs 150 crore to about Rs 250 crore in that period, 40 per cent of which will come from exports.

The new plant will be able to make machines of higher capacity, about 1,000 tonnes.

Currently, L&T-Demag makes about 130 units a year and earns about Rs 60 crore in revenues.

It can make injection moulding machines of up to 150 tonnes capacity, according to Mr Naik.

The plant to manufacture Defence equipment will be set up under L&T itself. It will come up on 20 acres of land, a further 7 km from where the L&T-Demag plant will come up.

It is expected to earn revenues of Rs 50 crore initially, which will go up to Rs 100 crore in a couple of years. This plant, according to Mr Naik, will make bridges and launchers for the Defence establishment.

He expects a good export potential for this business. The plant will make aluminium bridges that can be folded and rolled across rivers, according to him.

To a question, Mr Naik said the availability of educated, skilled people and the large number of engineering colleges in Tamil Nadu was the reasons L&T decided to set up these businesses near Chennai. These two plants would initially employ about 700 people.

He said L&T would also explore the possibility of exporting products made by its rubber processing machinery unit and also sourcing components for this business from China.

At a later date, it would look into the possibility of setting up a manufacturing facility in China.

Mr Naik was here to participate in the 60th anniversary celebrations of ECC, when L&T will open the Holck-Larsen Centre in memory of one of its founders, Henning Holck-Larsen.

Mr A. Ramakrishna, President (Operations), ECC, and Deputy Managing Director, L&T, said ECC was building about 30 projects in 18 countries.

It would concentrate on the Indian Ocean Rim where it believed it had advantages such as competitiveness and technology that was relevant to the region.

More Stories on : New Projects | Plastics

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