Finolex to introduce three new products in FY07

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

The restructured manufacturing facility at Urse will commence production of light duty electric cables(LDEC) for the domestic market, the company's assistant managing director and chief financial officer Pravin Parasnis told Business Standard soon after the company's Annual General Meeting 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 last year upon a restructuring of the Urse facility," Parasnis said.

The Rs 20 crore exercise, involving modification in the production lines and installation of balancing machinery is now complete and the production of LDEC will commence soon, Parasnis added. A similar restructuring at the company's Goa facility is on the cards, he said.

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

The company has invested Rs 70 crore for the new production  lines for these products out of which Rs 20 crore were spent for the switches and CFL line and rs 50 crore for high voltage power cables line, 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 make as many as demanded by the market," he said.

The switches, to be branded "Finoswitch" will be in two categories; one a high end and the other for the mass markets." In a full year of operation (which will be 2007-08) the company expects a revenue contribution of Rs 50 crore from the CFL business while the 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 and will contribute Rs 100 crore to the company's earnings in 2007-08, he added.

Expressing high hopes about the development of the country's infrastructure and 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.