Autoline bullish on design capabilities

Automobile components-maker Autoline Industries Limited (Autoline) is banking on its design capabilities to attract business from overseas automobile manufacturers, who intend to introduce in the Indian markets high-end, specialised products that are not expected to log large volumes.

Autoline director M Radhakrishnan told Business Standard that they were in talks with automobile companies in Europe and the US to offer "art to mart" product design service that will cut down on the development time.

He said Autoline had entered into an arrangement with US-based Detroit Engineered Products, which will offer their software tools for design development. The relationship with Detroit Engineered is expected to get some direct business too, Radhakrishnan indicated.

Autoline had recently entered into a design-engineering-manufacturing (DEM) arrangement with Belgium-based Stokota under which it would redesign the Stokota heavy-duty trucks to suit Indian conditions and manufacture the truck bodies to fit on local HCVs.

"We have dispatched about 100 Stokota tippers so far and look forward to extend the arrangement to other products as well," Radhakrishnan said.

Autoline director Gopal Patwardhan said the company could reach similar arrangements with companies like BMW, which are likely to choose the third party manufacturing route to enter the India market. "We have the capability to design and manufacture assemblies needed for such manufacturers and will pitch for supply of components," he said.

The company has five manufacturing locations where it makes major assemblies and skin panels as well as sheet metal components and formed tube parts such as silencers for automobiles. It also has a wholly-owned subsidiary Autoline Dimensions, which focuses on computer- aided engineering.

Radhakrishnan said the company was a single source supplier to Tata Motors for well over 100 items and also supplies components to Bajaj Auto and Mahindra & Mahindra.

"We will try and expand our activities through the DEM capabilities to de-risk our business. At present, a major part of our business comes from Tata Motors but instead of reducing this business, we will look for opportunities that utilise our capacities and give greater margins," he said.

The company's Rs 75-crore IPO opened today and is priced in a band of Rs 200 "� Rs 225. The issue closes on January 12.