Special team set up to consider acquisitions across business segments in Southeast Asia.
With an eye to scale up global presence, Delhi-based JK Organisation has set up a special team to explore opportunities across business segments in overseas markets.
The team has specifically been mandated to explore opportunities for acquiring companies in Southeast Asian countries for group company JK Tyre and Industries Ltd. Vice-Chairman and Managing Director, JK Tyre, Raghupati Singhania said, “We are looking at acquisitions in low-cost manufacturing hubs as we intend to increase our footprint overseas. A team has been set up to explore opportunities globally across verticals and for JK Tyre.”JK Tyre, which has overseas presence valued at around Rs 800 crore, has firmed up plans to grow business in overseas markets by 15-20 per cent, annually.
The company, at present, exports products valued at over Rs 450 crore from its facilities in India. The remaining resources filter in from products sold by Tornel, a Mexican tyre company it had acquired in 2008.The company also has entered into sourcing agreements with tyre manufacturers in China, Vietnam and Sri Lanka to sell products under the JK and Vikrant brands in global markets.
The company sells its products in 80 countries, particularly in south and central America and Africa.
To meet the growing demand in the automotive industry, JK Tyre is working on advancing the commissioning of the plant it is setting up in Chennai. “We are making efforts to make our facility in Chennai operational by the year end. The plant was earlier scheduled for commissioning in mid 2012,” Singhania said. It will have a capacity to produce 2.5 million passenger car tyres and 450,000 units of truck, bus radials every year.
JK Tyre has five plants across the country with a combined capacity to produce nine million units annually. The company is investing Rs 1,500 crore to set up its sixth facility in Chennai which would increase by a third installed capacity.
The $2.5 billion JK Group has also announced its foray into the power sector. “We are setting up a power plant of 660 Mw near Jhansi in Madhya Pradesh. The plant should be operational in two years,” said Singhania. The organisation is investing Rs 1,300 crore in the first phase. In the second phase another plant of 700 Mw will be set up. A special purpose vehicle (SPV) would be set up by JK Organisation to manage the company’s venture in the power segment.
