Mahindra Engg to set up Chennai R&D unit

Mahindra Engineering Services (MES), a part of the Mahindra & Mahindra group, would set up Mahindra Research Valley (MRV) in Chennai with an initial investment of Rs 500 crore.

The project is set up to focus on automotive and aerospace engineering & design services and will employ 3,000 engineers in the next 6-12 months, said Hemant Luthra, president, Mahindra Systems and Automotive Technologies (MSAT). MES is the subsidiary of MSAT. The fund will be financed by the group's internal accruals.

MRV will do the prototyping and designing of auto components for Boeing, Airbus, Volkswagen, BMW, DaimlerChrysler, and Ford.

"MRV will be focusing on computer aided engineering and design. With our rich experience in making automobiles and serving customers such as International Truck and Renault, we are confident of making a mark in our chosen field," said Luthra.

MRV will cover an area of about 150 acre, and is located close to Mahindra Infrastructure Company's township project Mahindra City.

MES is talking to US-based engineers and scientists in the automotive and aerospace sectors to collaborate with the project.

"We would like a nucleus of 10-15 engineers from US to head MRV. We would offer these scientists incentives to work with the option to return back if they are not satisfied," said Luthra.

In an effort to spearhead its capability in the aerospace field, MES is looking towards a string of acquisitions in the area.

"We are in talks for acquisition with various international and few Indian aerospace companies to add up our capabilities in the area," said Luthra.

The company recently acquired JP Morgan's 77.6 per cent stake in Plexion Technologies for $10 million.

Plexion has engineers from Hindustan Aeronautics Ltd (HAL) and Indian Space Research Organisation (ISRO) on its payroll.

MES currently contributes towards a revenue of $ 25 million to MSAT. "We expect to achieve a revenue of $ 100 million in by 2010," said Luthra. On the overall, MSAT expects to touch a revenue of $ 1 billion by 2010 from the current $ 250 million.