Uno Minda (formerly Minda Industries Ltd), a leading diversified auto parts manufacturer, is planning to invest ₹175 crore in expanding the capacity of airbags, which is under a joint venture with TG Minda India Pvt Ltd.
The new capex is in addition to the company’s ongoing multi-year capex programme involving ₹1,664 crore.
TG Minda India Pvt. Ltd., a joint venture between Toyoda Gosei and Uno Minda Group, is a leading manufacturer of automotive safety systems, fuel caps, and weather-strip sealing parts. The proposed fresh capex of ₹175 crore will be invested in ramping up the capacity of TG Minda India’s unit in Rajasthan.
The Union Road Transport and Highways Ministry made it mandatory to have a six-airbag rule for passenger cars with effect from October 2023. To meet this regulatory requirement, OEMs will have to install six airbags. This is creating additional demand.
“In fact, a few of our customers have already placed orders for these enhanced requirements. Existing driver airbag (DAB) and passenger airbag (PAB) demand is also increasing in line with the growth in vehicle volumes. To meet this increased demand driven by changes in regulations, Uno Minda’s joint venture company, Toyoda Gosei Minda India Pvt. Ltd. (TGMIN), needs to enhance its capacity at its existing plant at Neemrana in Rajasthan,” Sunil Bohra, Group CFO at Uno Minda, told businessline.
Ramping up production
The existing airbag production capacity of the Neemrana unit is 18,00,000 units per annum, and the proposed addition is 12,00,000 airbag units per annum. The expanded capacity is proposed to commence by December 2024.
Uno Minda has already planned a total capex of ₹1,664 crore across its multiple entities. This will be incurred across locations in a phased manner over 3–4 years.
Bohra also said the company won about ₹300 crore in orders for EV-specific products only. These are incremental orders received in Q3 FY23 and are over and above the ₹520 crore orders announced in previous quarters. Thus, the total peak annual value of all EV-specific components is about ₹800 crore.
The company operates diversified product divisions that include switching systems with 11 plants, acoustic systems with 6 factories, lighting divisions with 8 units, castings production (6 units), and a seating business that runs 6 units, among others. The company enjoys market leadership across products, being the largest supplier of switches for passenger vehicles and two-wheelers as well as automotive horns in India.