Tata Hitachi mulls indigenisation to up margins, cut imports

Tata Hitachi is a 40:60 per cent joint venture between the Tata group and Japanese conglomerate Hitachi Construction Machinery.

Company's Managing Director Ranveer Sinha said that at present company's EBIDTA (Earnings Before Interest, Taxes, Depreciation and Amortisation) margins are on negative side.

He added that the company's market share which is currently pegged at 37 per cent is under pressure due to increased competition from Chinese manufacturers.

"Currently, I must tell you, we are not EBIDTA positive. We are not positive so far because 50 per cent of our components are imported and there is a sharp decline in the exchange rate of the Indian currency which has affected our margins.

"You cannot pass on that decline to the customers," Sinha said during his recent visit to Hyderabad. He however, refused to share margin figures saying that they are listed.

"We are also bringing some Japanese manufacturers to make products with Indian companies in India in order to bring down the overall cost and also save on transportation and duty," he added.

Replying to a query, he said the company is also looking at going to low-cost countries such as Korea and China for import of some of the components which are not critical.

"We are in discussions with some countries. In three years time-frame we have a target of reducing the import content from an average of

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