The Hindu Business Line : Hong Kong team in talks with HMT for joint venture facility

A CONSORTIUM of clock manufacturers from Hong Kong is in talks with the Bangalore-based HMT Watches Ltd for setting up a joint venture manufacturing facility in India, mainly for exports to other countries.

According to Mr S. Siddalingaswamy, Managing Director, HMT Watches, a consortium of 14 manufacturers who are members of the Hong Kong Clock Manufacturing Association, currently in India, is looking for equity investment in a manufacturing facility in India.

While talks are on between HMT and the Hong Kong consortium, the details of an equity participation in the project can emerge only once the Government gives the necessary clearances, said Mr Siddalingaswamy.

"Talks are currently on with the Hong Kong team. The proposal is that the balancing equipment will be supplied by the Hong Kong companies and manufacturing of other parts and assembling will be done in India. The talks are at a preliminary stage," he said.

Meanwhile, HMT is looking to scale up its existing exports of movement parts to Swiss watch companies. With HMT emerging as the only Indian company to manufacture automatic (mechanical) watches, the Swiss companies are keen to shore up their supply link with it, Mr Siddalingaswamy said.

Lowering debt: The company's ongoing efforts to whittle down its debt portfolio that is hovering around Rs 400 crore have seen HMT put a 60-acre plot at Jalahalli near the Bharat Electronics Ltd complex in Bangalore on the block. It is looking at a reserve price of around Rs 2 crore per acre and currently bids are coming in for the prime property. Once the sale goes through, the company is looking to pare down its debt by over Rs 100 crore, he said.

HMT, which is looking to close the fiscal with a turnover of Rs 130-150 crore, has targeted a turnover of Rs 200 crore by 2005-06. This is expected to come by way of taking its manufacturing base to three million watches.

By 2006-07, the targeted sales is Rs 300 crore, which will turn back the clock for the company to its heydays of 1993-94 when its sales had touched seven million watches. It is also looking to leverage on its unutilised capacity of almost four million by catering to demands both in China and Hong Kong as also Switzerland.

The company has worked a new marketing strategy under which the number of its regional sales centres stands reduced from 13 to four. HMT is also planning to refurbish and relocate some its major retail outlets.

Nod for recast plans soon: Meanwhile, the long-pending Cabinet approval for HMT Group's financial restructuring is expected to be cleared shortly, paving the way for all the three subsidiaries to go ahead with their revival plans.

More Stories on : Alliances & Joint Ventures | Watches & Accessories

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Ranbaxy offers tie-ups to distribute drugs abroad

Deming Prize for SRF

Compete or perish

Bajaj vehicles to ride Pakistan roads

L&T to invest Rs 60-70 crore in plastics, Defence equipment plants

AP Paper Mills expansion

It's business as usual at CLB

Hong Kong team in talks with HMT for joint venture facility — Awaits Govt nod for equity investment

CSM releases guide on corporate social responsibility

Infotech Trust builds school in Kukatpally

SEC Ind to foray into space sector

A case for strengthening SICA

Lenders clear BPL debt recast package

CUMI to ramp up exports, invest in new technologies