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Japanese equipment major Mitsui has decided to use the upcoming facility of Rs 1,400 crore Indian construction equipment maker TIL Ltd as one of its four global export hubs for port cranes.
The Rs 150-crore facility, spread over 100 acres at Changual near Kolkata, will manufacture port and yard equipment (gantry cranes, ship-to-shore cranes, etc) in technical collaboration with Mitsui.
The Japanese infrastructure engineering company has existing manufacturing hubs for such cranes in Japan, Spain and Korea.
In addition to port cranes, the Changual facility will also manufacture crushers and screens in collaboration with Astec Aggregate Mining Group, US. .
Currently on trial run, the plant will be formally inaugurated on November 18 and is estimated to boost TIL's turnover by Rs 1,000 crore in the next 2-3 years.
Export opportunity
“We are expecting the plant to open a sizable overseas business opportunity for the company, as Mitsui has offered us with export rights for port cranes,” TIL Vice-Chairman and Managing Director, Mr Sumit Mazumder told Business Line .
The company has already started re-exporting some equipment to Mitsui.
The anticipated overseas business should also reduce TIL's overdependence on the domestic infrastructure sector — especially the road construction sector which is now facing a “temporary” slowdown.
The company currently exports a small basket of infrastructure equipment and services mostly to Nepal and Bhutan.
In the longer run, the new products and services would also reduce the group's dependence on the Caterpillar dealership business, handled by wholly owned subsidiary Tractors India Pvt Ltd.
New Crane factory
The drive to expand product offerings will get a further boost once TIL commissions its fifth plant at Vidyasagar Industrial Park at Kharagpur, situated approximately 100 km from Kolkata, in March 2013.
To be located on a 104-acre piece of land, the Rs 150-crore facility will manufacture Reach stackers in collaboration with Hyster and create additional capacities for cranes (in collaboration with Grow Worldwide).
The lease deed for the project was finalised by the state government in September and construction is set to begin this month.
“Our cranes division enjoys a rising market demand. Though we have recently revamped the capacity of the existing crane manufacturing at Kamarhati (West Bengal) by 40 per cent, the expanded capacity is expected to be exhausted in three years,” Mr Mazumder said underlining the need for a new crane facility.
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