The Hindu Business Line : Domestic demand boom delays Exide's foreign foray

Unprecedented growth in domestic demand for lead-acid batteries seems to be coming in the way of Exide Industry's moves on acquisition opportunities in Germany.

Though there are claims of continuing parallel negotiations with prospective sellers in foreign shores, senior company officials admit they are finding it tough to take their eyes off prevailing opportunities at home.

Exide had received offers for acquisition in Germany where battery makers are reportedly passing through a trying time. According to company sources, the situation there has led a number of companies towards perennial sickness or closure. "We are in touch with the interested parties in Germany. However, we are yet to take a call on any such acquisition," the Exide Chairman, Mr S.B. Ganguly, told Business Line.

The company is currently witnessing 34 per cent growth in demand for both industrial and automotive batteries and it has already launched a Rs 120-crore capacity expansion programme at almost all its facilities across the country.

Automotive battery capacity will be expanded from 4.5 million pieces to 5.5 million pieces.

Motorcycle batteries, which are experiencing the highest demand, will move up from six million pieces to 7.5-8 million pieces.

The industrial battery capacity will be expanded by 150 million ampere hour. Apart from expanding capacities of existing production lines at Hosur, Haldia, Shyamnagar and Guindy, Exide is setting up a new facility at Haldia to produce up to one million pieces of traction batteries.

Interestingly, company sources claim the ongoing expansion programme would also take care of the OE demand for Tata Motors' small car project at Singur in West Bengal. The cars are expected to roll out in 2008.

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