The Hindu Business Line : Roots Multi Clean opens EoU to tap export market

WHEN the Coimbatore-based Roots Industries Ltd (RIL) forayed into mechanised cleaning equipment manufacture by floating a separate company in the early 90s — Roots Multi Clean Ltd (RMCL), the market response was overtly poor.

But with enterprises turning environment-conscious and going global, companies are indirectly compelled to invest in such equipment. The market, according to Roots sources, is witnessing a 15 to 20 per cent growth year-on-year.

RMCL, according to the Group Chairman, Mr K. Ramaswamy, is a one-stop shop for the complete range of cleaning equipment. Roots Industries and the Germany-based Hako Werke GmbH incidentally have promoted Roots Multi Clean. The collaborative agreement between the joint venture partners has facilitated the company to market its products in India, Pakistan, Nepal and Sri Lanka. Sensing growth in markets abroad, it decided to enhance its strength by inaugurating a 100 per cent export-oriented unit (EoU) at its Kovilpalayam factory premises.Briefing presspersons, Mr Ramaswamy said that Roots Multi Clean, in a span of 12 years, has emerged as the largest manufacturer of cleaning equipment and perhaps the only exporter of such equipment to developed nations.

Recapitulating the growth, he said the company imported Hako products and under the guidance of its joint venture partner, carried out certain alterations to suit international market specifications. "Convinced with the facilities and the quality of the product, Hako has since shifted the production of Hako Flipper machines to India," he said. Many of the products manufactured in this EoU would go to Hako, he added.

Though there were no authentic figures to estimate the size of the domestic market for mechanised industrial cleaning equipment, company sources perceive that it is overRs 100 crore, and this is said to be growing at 15-20 per cent every year.

Currently, the company has a wide range of product offerings. It is also contemplating to design and develop compact cleaning machines. To maintain its growth plan, the company would be investing Rs 10 crore on research and development over the next five years, Mr Ramaswamy said.

The company has, in the last couple of years, steadily increased its exports to reach a level of 55 per cent of its production. "We are targeting at 65 per cent in two years," he said. Even while being optimistic about its growth and market response, the company perceives the lack of Government support for such ventures.

"We are not seeking an exemption, but a concession in taxation rates and excise duties. If we have to sell an imported machine, the customer will have to pay tax at 21 per cent and the machines attract a 16 per cent excise duty. The customer is forced to pay through his nose," he explained.

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