XCMG, a China-headquartered global construction machinery company, will invest ₹150 million in a new manufacturing unit in India for construction and material-handling machines.

For the proposed venture, the company will partner with Schwing Stetter India , a ready-mix concrete equipment company, to use the latter’s facilities and resources to build its business in India.

The $13-billion XCMG has majority control in the $1-billion Schwing Group, based in Germany.

“Schwing Stetter India has already paved the way for our entry in India. While Schwing has a strong presence in the concrete equipment segment, our objective is to grow in the non-concrete machinery segment,” Wang Min, Group Chairman of XCMG China, said here on Thursday.

While XCMG is in the process of finalising the location for the new factory, there is a strong possibility the unit will come up near Chennai due to various advantages, according to Anand Sundaresan, Vice-Chairman and Managing Director, Schwing Stetter India.

However, both the partners expressed confidence that the new factory will be up and running by the end of this calendar year.

Wide range of products

While XCMG is evaluating a range of products to be sold in India, the first set of products may include truck cranes, wheel loaders and motor graders.

“Our growth model will be not based on a few products, but a variety of machineries catering to different application areas,” said Min.

He also felt that XCMG’s entry is happening at the right time as the construction equipment industry in India is getting ready for the next boom.

XCMG products will be sold under a separate entity, but will use the distribution and after-sales network of Schwing Stetter India.

Sundaresan said the XCMG board recently cleared a big investment plan for various markets to further boost its global growth, and India is also part of that plan.

XCMG garners about a third of its revenues from outside China.

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