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The $2-billion-plus Anand Group, which manufactures auto systems and components, on Wednesday said it has signed a joint venture (JV) with Korea’s $8.1-billion HL Group.
The partnership will be called ‘HL Anand Automotive Parts Private Limited’ and will supply a range of aftermarket components for the passenger vehicle segment in domestic and international markets. Two distribution centres will be set up for the new company in the next two years, the company said in a statement.
The JV will expand the aftermarket portfolio with products manufactured by Anand’s existing JVs with HL Group’s Mando Corporation, an automotive components leader based in Korea.
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The existing partnerships are HL Mando Anand Automotive, which makes steering, brake, and suspension systems; and Anand Mando eMobility, which manufactures motors and controllers for electric vehicles (EVs).
The JV will increase the Indian company’s aftermarket business two-fold while building the Korean entity’s presence in India, it said.
“This strategic JV with HL Group will significantly expand our aftermarket business in both domestic and international markets. The JV will capitalise on the strong Anand Group aftermarket ecosystem in India and HL Group’s sourcing expertise and well-established global network,” Mahendra Goyal, Chief Operating Officer, Anand Group, said.
With this alliance, the company expects its aftermarket business to grow at a CAGR of 15 per cent over the next five years. The company will focus on the core products manufactured by the existing JV entities and will be free to source other products, as feasible, for growth, he added.
India’s auto aftermarket, which is growing at around 10 per cent annually, is valued at around ₹85,000 crore ($10.6 billion), while the global aftermarket is estimated at around $408 billion, according to industry reports.
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