Dependence on ALL falls sharply: Hinduja Foundries

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Chennai, May 6 : Hinduja Foundries Ltd, formerly Ennore Foundries, has substantially brought down its dependence on core customer - Ashok Leyland Ltd - from 76% in 2003-04 to 48% now and the same will be further brought down to 36% in the next two years, said V Mahadevan, Managing Director, Hinduja Foundries.

"The company has decided to focus only on high-end and premium products to exploit huge demand from domestic and international markets. Hence, we stopped supplying low-end products to ALL, following which the dependence on ALL has been brought down substantially in the last few years," he said. "Our new greenfield projects and capacity expansion at its existing plants are all aimed at serving non-ALL and new customers," he added.

Addressing a press conference here on Tuesday to announce the annual performance of the company, he said the company has embarked upon Rs 350 crore growth plans, which include greenfield projects and expansion at its existing facilities, he said.

"We will be setting up a new ductile iron casting foundry in Hyderabad with an initial capacity of 48,000 tonne at an investment of Rs 150 crore. A new aluminium die casting facility at Sriperiumbudur near Chennai with an investment of Rs 50 crore for 2,500 tonne capacity and expanding its existing capacity at Sriperumbudur to 72,000 tonne from 50,000 tonne with an estimated investment of Rs 100 crore and a new machine facility near Chennai," he said.

Responding to queries, he said the investments will be met through debt, equity and internal accruals. "We have raised $15 million recently through a GDR issue, bringing down promoters holding from 81% to 68%," said V Sankar, Chief Financial Officer, Hinduja Foundries. Since the expansion and new projects are to be implemented in phases, the company will think on raising funds at that point of time, he added.