Financial Daily from THE HINDU group of publications
Thursday, Jul 15, 2004
Financial Daily from THE HINDU group of publications Thursday, Jul 15, 2004 |
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Corporate
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Outlook Exide powers global initiatives — Deals with Russian Navy, China co on anvil Our Bureau
Kolkata , July 14 EXIDE Industries, the domestic leader in storage batteries, is recharging its overseas initiatives. The Chairman, Mr S.B. Ganguly, told reporters after the company's 57th AGM here on Wednesday that he would lead a team to Russia to sign an MoU with the country's Navy to supply batteries for its submarines. Russian agency Rubin Design Bureau has evaluated Exide batteries for Foxtrot and Kiloclass submarines and assessed the suitability for fitment. Mr Ganguly also said Exide would have a technology tie-up with a Chinese manufacturer for lithium batteries. He also stated that negotiations were on with Exide of the US for reciprocal market entry. Elaborating on the initiative with the Russian defence establishment, he said the MoU would be preceded by a certification on the conformity to specification and quality prescribed by the Russian Navy. "A Russian defence team has already visited our facilities manufacturing sophisticated submarine batteries, which we have supplied to the Indian Navy and Algeria. A formal certification would clear the way for an MoU, which, in turn, would make way for Exide batteries in submarines built by Russians," he added. A submarine battery costs around Rs 12.5 crore to Rs 13 crore. Considering that Russian batteries have markets outside the country's territory, the MoU is likely to allow Exide entry into a huge international market. "We have been found cost- and quality-competitive," Mr Ganguly said. Exide is also in talks with authorities in Peru and Indonesia for submarine battery export. Regarding the foray into China, he said: "For now we are moving towards a pact with an outfit there for lithium technology. An Exide team, including our board members, visited China recently and discussed business opportunities with 10 manufacturing units. We have also considered the possibility of a manufacturing joint venture but that may happen later in the future." He also said that Exide in the US has expressed its willingness to enter the Indian market while Exide Industries is keen to enter the US market. "We are discussing whether we can tread into each other's territory without replication or competition. There could be niche areas where we can let each other play," he explained. The company would invest around Rs 60 crore during the current fiscal. An investment of Rs 40 crore would be made for a 14 per cent increase in automotive batteries production capacities and the rest on industrial (traction) battery production units. Pursuing the financial restructuring plan, loans worth Rs 50 crore would be repaid during this financial year against Rs 170 crore.
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