Voltas plans to sell off Hyderabad unit

The 32-acre property could bring in up to Rs 150 cr.

The Tata group's engineering company, Voltas, plans to sell off its Hyderabad-based manufacturing facility. The 32-acre property at Sanathnagar is located near the Hyderabad airport.

Confirming this, M M Miyajiwala, executive vice-president, finance, Voltas, said the plant had become non-feasible on account of its high employee turnout and unviable refrigerator business. The property could fetch Voltas about Rs 130-150 crore, real estate sources said.

Voltas has given voluntary retirement to all 3,500 employees with an outgo of Rs 65 crore for the VRS activity. It is in the process of shifting its Hyderabad operations, engaged in making retail coolers for food products, to Pantnagar in Uttaranchal.

"Currently, we are in the process of shifting our Hyderabad operations to Uttaranchal. By the beginning of the next financial year, we will begin the manufacturing of cooling solutions from the Uttaranchal facility," he said.

Till a few years ago, the company used to make refrigerators at its Hyderabad plant, which it had to stop completely on account of meagre returns from the business.

Voltas is currently putting up three facilities in Pantnagar for manufacturing coolers, room air-conditioners and industrial conditioners.

The company is well known in air-conditioning and has an existing capacity of 4.5 lakh units (for room air-conditioners) in Dadra.

The company also manufactures its industrial range of ACs in Thane.

"Air-conditioning will be the core business for Voltas' consumer appliances business. The upcoming AC manufacturing units in Uttaranchal is part of our expansion in the area to meet the demand for air-conditioning from India and overseas," said Miyajiwala.

Electromechanical projects and services, engineering products and services and air-conditioning and cooling services are the three major areas of Voltas' erations.

Electromechanical projects contribute 60 per cent of the company's total revenues, engineering services 12-14 per cent, and air-conditioning and cooling the rest of 27-28 per cent.

Voltas' net profit grew 49 per cent to Rs 11.36 crore in the quarter ended Decemer 2005, from Rs 7.60 crore in the same period last year. Its net sales rose 50 per cent to Rs 447.09 crore for the quarter compared with Rs 298.60 crore last year.