TAFE-Power invests Rs 50 crore in lead acid battery plant

TAFE-Power Source, a division of Tractors and Farm Equipment Ltd (TAFE), has invested around Rs 50 crore in its new valve regulated lead acid battery (VRLA) facility in Maraimalai Nagar, a suburb of Chennai. The plant is expected to begin commercial production by the end of 2006.

Jayshree Venkatraman, director, Tractors and Farm Equipment Ltd (TAFE), told Business Standard, that the new plant, spanning over 8.7 acre, would manufacture the entire range of VRLA batteries ranging from 6V1.2AH to 12.230 AH. The unit would be the company's third plant in Maraimalai Nagar.

TAFE-Power Source had entered into an agreement with the Chinese-based battery maker, BB Battery Co Ltd last year.

Under the agreement, the Chinese firm provides technological expertise on VRLA batteries to the former. Tafe-Power Source also has an exclusive tie-up with the Chinese battery maker to export VRLA batteries to all the SAARC countries.

She pointed out that the boom in the telecommunication and the information technology sector has led to a spurt in the demand for VRLA batteries in the country. VRLA batteries require no maintenance and is used in wireless communication, emergency lighting, security systems and medical equipment.

The VRLA battery market in India is estimated between Rs 800 crore and 900 crore. Nearly 40 per cent of the demand, which is worth about Rs 360 crore, comes from the telecommunication sector, followed by the uninterrupted power supply (UPS) and inverters.

The company also has two other plants in Maraimalai Nagar, one for manufacturing two-wheeler batteries and the other four-wheeler batteries. Tafe-Power Source has also invested about Rs 25 crore and Rs 15 crore respectively in expanding capacities of these plants by April, 2006.

The capacity of the first plant would be increased to 7 lakh unit of two-wheeler batteries per month, from the current 5 lakh unit per month. The capacity of the other plant would be expanded to 1 lakh unit per month, from 60,000 units per month.

The VRLA batteries would be branded as Speed Boss and would be launched in May or June. Tafe-Power Source is in talks with Bajaj, for supplying its VRLA batteries. Initially, the company would supply 1,000 prototype batteries and eventually increase it to 6,000 units.