Livemint: January 03, 2017
New Delhi: Exide Industries Ltd said it will invest Rs300 crore to expand its capacity for advanced MOTORCYCLE batteries over a period of 18 months starting April.
On Monday, India’s biggest automotive battery maker opened a Rs700 crore assembly facility in Haldia to make so-called punched grid batteries with technology from East Penn Manufacturing Co. of the US. Exide is the first producer of such batteries in India.
These batteries will be sold at a premium under a new sub-brand, said Gautam Chatterjee, Exide’s managing director and chief executive officer, without giving details.
With the new facility, Exide has increased its annual production capacity by 1.2 million to 15 million batteries.
Exide’s Haldia FACTORY, set up in 1981, will be further expanded at an investment of Rs120 crore, Chatterjee said, adding the company was going to set up a smelting unit for which the state government had agreed to provide 25 acres.
Business is unlikely to be impacted by demonetization, and Exide may actually benefit from it though there are some disruptions immediately, Chatterjee said.
Sales in the replacement market are unlikely to be affected by demonetization, he said. On the other hand, the unorganized sector, which accounts for an estimated 37% share of this market, might not be able to cope with the changed scenario, he added.
But in the near term, demonetization has hit the sales of MOTORCYCLE BATTERIES—sales have declined by around 30%, according to Chatterjee. But sales of passenger car batteries remain unaffected.
With lead prices rising by 10%, Exide has in the past couple of months raised battery prices by around 7% in two tranches to protect margins.
A statement from Exide quoted its vice-chairman Rajan B. Raheja as saying that the firm decided to build its assembly line in West Bengal in recognition of chief minister Mamata Banerjee’s initiatives to improve the state’s position in manufacturing.
Raheja, whose R.B. Raheja group controls Exide, was visiting the company’s headquarters in Kolkata after almost two decades. During the next few days, he is expected to meet the company’s DEALERS and key executives.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.