Finolex Cables to introduce 3 new products

Cable manufacturer Finolex Cables will introduce three new products in the market during the year 2006-07 once the restructuring of its factory at Urse, off the Pune-Mumbai expressway, is complete.

After restructuring the facility will commence production of light duty electric cables for the domestic market, the company's assistant managing director and chief financial officer Pravin Parasnis told Business Standard soon after the company's AGM on Tuesday.

"The slowing down in demand for jelly-filled telecom cables (JFTC), largely due to the explosion in the mobile telephony segment and a shift in favour of optical fibre cables for the long distance trunk routes, had led the company to embark upon a restructuring of the Urse facility last year," said Parasnis.

The Rs 20-crore exercise, involving modification in the production lines and installation of balancing machinery, is now complete.

The production of LDEC will commence soon, informed Parasnis. A similar restructuring at the company's Goa facility is on the cards, he said.

The firm is entering three new product businesses during the year. These will be modular electrical switches, compact fluorescent lamps(CFL) and high voltage power cables added Parasnis.

It has invested Rs 70 crore for new production lines for the products, of which, Rs 20 crore were spent for the switches and CFL line, while Rs 50 crore were spent on high voltage power cable lines, he explained.

The production capacity for CFL is 8 million per year, while the production of switches will largely determined by the assembly operations we undertake. "We can meet market demand," he said.

The switches, to be branded "Finoswitch" will be of two qualities - one will be targeted at the high-end market, while the other will be for the mass markets."

In the first year of its operations (2007-08), the company expects to earn a revenue of Rs 50 crore from the CFL business, while the business of switches will add Rs 30 crore to the top line, Parasnis said.

The third product, high voltage power cables, will be in the market in the early part of 2007. It will contribute Rs 100 crore to the company's earnings in 2007-08, he added.

Placing high hopes on the development of the country's infrastructure, housing and real estate sectors, Parasnis said, the modified product mix and the introduction of new products will take the company on a growth path again. "We expect to grow 30 per cent year on year," he added.