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Hero Motors to set up plant in Chittoor district of Andhra Pradesh

The Economic Times:  September, 2014

Hyderabad: India's largest twowheeler maker Hero MotoCorp plans to invest Rs 2,200 crore to set up a manufacturing plant in Andhra Pradesh, according to a senior official.

The state Cabinet on Monday cleared allotment of 600 acres near Sri City integrated business city in Chittoor district to Hero Moto-Corp, steeling a march over neighbouring states to host the factory.

Hero MotoCorp MD and CEO Pawan Munjal had said in June that the company was looking at setting up one of its largest facilities in south India for the local market. The announcement saw Telangana, Karnataka and Tamil Nadu woo the two-wheeler giant with competing incentive packages.

"The top leadership of Hero Moto-Corp led by Pawan Munjal met Andhra Pradesh chief minister in Delhi last week and entered into a preliminary agreement to set up the project in the southern part of the state, which may be entitled for central incentives as a part of the erstwhile AP state bifurcation Act," the Andhra government official said. Hero MotoCorp could not immediately be reached for comment.

A top executive of Sri City, which houses corporates such as Cadbury, PepsiCo, Kellogg's, Colgate Palmolive, Alstom and Isuzu Motors, said Hero MotoCorp new plant will provide employment to around 9,000 people.

"Though the land the AP government has agreed to allot is next to our integrated business city belonging to the AP Industrial Infrastructure Corporation, Hero MotoCorp would use our infrastructure for most of its operations," the executive said, requesting anonymity.

The proposed plant, which will have a capacity of 1.8 million units, will be Hero MotoCorp's sixth facility and will take the company's overall annual capacity to 12 million units.