• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest
• The New Manager

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Our Bureau

Spins off 2-wheeler biz, auto parts into separate arms

Advertisement

Pune Jan. 23 In a major restructuring move, the Kinetic Group has re-organised its operations into two verticals - auto components and two-wheelers. With this restructuring, Kinetic Engineering (KEL), the erstwhile manufacturer of mopeds, motorcycles and engines, has now transferred its two-wheeler operations to Kinetic Motor Company Ltd (KMCL), the Group's scooter manufacturing arm.

KEL will now focus exclusively on manufacture of auto components and assemblies whereas KMCL will now be the group's arm, which will manufacture and market the entire range of two-wheelers.

Commenting on the restructuring, Mr Arun Firodia, Chairman of the Kinetic Group, said: "This is not a restructuring but a transformation of Kinetic Group where I expect the group to emerge stronger and well poised to tap the opportunities for growth in a focused manner. KMCL as the two-wheeler arm will benefit from the consolidation of its entire two-wheeler business and by tapping synergies in operations. In KEL, the focus of auto components business will enable us to harness its strength in engineering and low cost manufacturing areas. Our relationships in the auto industry have enabled us to build up a strong order book in auto components and we see limitless opportunities in this area. We will leverage these strengths to build this business organically as well as non-organically in the coming years. Our goal will now be to take forward the two businesses with aggression and focus."

He said the restructuring is aimed at creating a focused businesss model, which could further its two-wheeler business as well as tap the new growing opportunity in the area of auto components. The export of auto components from India has been on the rise and as predicted by McKinsey the auto components business will touch $20 billion.

According to an official communication, KEL has manufactured over 45 lakh engines for two-wheelers and has been supplying gears and other parts for scooters.

It added that KEL set up a SBU (strategic business unit) to boost its auto components business in 2004 and now has orders worth nearly Rs 200 crore for such components and assemblies for the financial year January-December 2007.

It has already begun supplies to most of its clients and plans to ramp up business rapidly in the coming months. The company plans to grow its auto components business to over Rs 300 crore by 2008.

More Stories on : Restructuring | Two/Three Wheelers

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

Stories in this Section
H&R Johnson to invest Rs 25 cr in R&D

Copyright © 2007, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line