Unfazed by the sluggishness in the automotive sector, tyre major MRF said it will continue to grow at 20% per annum and expand capacities at its Hyderabad and Trichy plants for an estimated investment of R1,000 crore in current fiscal (October-September 2014). The company will explore inorganic growth in Asean and African countries, said Koshy K Varghese, executive vice-president (marketing), MRF.
In an interactive session with mediapersons on the occasion of launch of a tyre for the Sukhoi 30 aircraft, he said: “The recession has probably flattened out and the slide has started disappearing slowly. Keeping in mind the 22% growth of the auto industry in the last few years, tyre makers created excess capacity. However, we are running full across plants and we continue to grow at a minimum level of 20% in the current fiscal too,” he said.
“Like last fiscal (October 2012 – September 2013), we will invest R1,000 crore in the current fiscal too, expanding capacity at Trichy and Hyderabad plants (all segment tyres) as well in dynamometer testing facility at the Medak factory near Hyderabad,” he said.
“We don’t see any threat from increasing competition, but we are vigilant to happenings,” he said, adding the company produces more than 100,000 tyres a day. The company is a little concerned about the sharp degrowth in commercial vehicle segment, which contributes 50% to its total sales, he added.
To a question on acquisitions abroad, Varghese said: “We are constantly looking at overseas acquisitions. We see opportunities in Asean and African countries and it makes sense for us to focus on these regions than any other country.”