Can you talk us through your entry into the US market with a greenfield manufacturing facility?
The new plant, the first to be set up outside India, will be an aluminium die-casting facility. We decided on this project due to the repeated requests from our customers for near-shore presence. This plant that will come up in the Dorchester county in South Carolina will deepen our decade-long engagement in the region while shortening the supply chain and improving our responsiveness. We aim to be a strong player both in the Indian and global markets.
What is the total investment in this project?
Our total investment in the US project will be over $50 million (Rs 350 crore) and we expect to generate around 130 jobs in the region. Since North America contributes a sizeable chnuk to our overall turnover, we expect the revenue too will increase proportionately. South Carolina is among the fastest growing automotive and manufacturing hubs in the US and this project will come up on a 50-acre site. We have customers such as Volvo, Daimler, BMW, among other major auto giants, in that region.
How do you plan to scale up this project?
We would be installing a capacity of 10,000 tonne of high pressure die cast and gravity cast parts initially. Construction at the site is expected to begin by April 2017 and the first production line will be ready by end-2018. For the first five years the plant will cater to customers in the US.
What about new projects in the near future?
Future projects will be decided based on business dynamics and customer needs. At present, the US accounts for about 60% of the company’s exports and 40% of its revenues.
You also talked about major expansion across your plants in Inida. Can you explain in detail?
We have four manufacturing plants in India. We are investing R400 crore and expected to increase production capacity in India from 60,000 tonne to 70,000 tonne per annum. We will fund the expansion through a mixture of equity and debt. In India, customers are expanding their facilities to cater to the growth anticipated in India and SCL will continue to invest to meet the increasing demand from Indian customers. We hope to generate around 500 jobs in India over the next 3 years. Our Indian operations continue to be robust. The fresh investments are in addition to the R408-crore investments made over the last few years.
