The Hindu Business Line : Hero Motors plans foray into 4-wheeler component biz

This follows its joint venture agreement signed last week with Kiriu Corporation, a subsidiary of Japan based Sumitomo Corporation to manufacture disc brakes and drum knuckles.

"With the technology know-how of Kiriu Corporation, we are looking to supply brake discs and knuckles to major players like General Motors, Suzuki, Toyota, Nissan, Mahindra amongst others," said Mr Rajesh Gulati, Chief Financial Officer, Hero Motors Ltd.

He said the company was close to supplying about one million discs to General Motors and expected to finalise deals with other major players over the coming two-three months. Further, he added that the company was also talking to global players such as Continental AG, Valeo and Bosch to supply its disc brakes.

Six months ago, Hero Motors Ltd started a manufacturing plant to produce brake discs and knuckles, and will be expanding its capacity from 30,000 tonnes to 1,00,000 tonnes in the coming four-five years. The company expects to garner revenues worth Rs 600-700 crore over the coming years through this expansion. It is also planning to invest an additional Rs 100 crore following its joint venture with Kiriu Corporation.

According to the agreement, in the joint venture Hero Motors would have 66.6 per cent stake and the remaining 33.4 per cent would be with Kiriu Corporation.

Till now, the company has been primarily catering to the two- wheeler segment and is a manufacturer of engine transmission, gearboxes, steel metal products and has now diversified into the production of ferrous casting products. With its current order book of Rs 1,100 crore up to 2009, Hero Motors is seeking to grab a pie of the four-wheeler export market with a special focus on Europe.

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