Kolkata :

Tamil Nadu and Rajasthan have the highest growth potential for the automobile industry for adding new and first time customers, an Assocham study said Wednesday.

According to the study, titled “Automobile Industry in India: Saturated and Potential States”, both Tamil Nadu and Rajasthan have registered a high growth in employment generation, per capita income and monthly per capita consumption expenditure share in durable goods and are ahead of the national growth in the three key indicators.

“Tamil Nadu’s gross domestic product (GDP) and motor vehicles registration growth are also more than the national level growth,” said D.S. Rawat, national secretary general of industry panel Assocham (Associated Chambers of Commerce and Industry of India) while releasing the findings of the study.

Andhra Pradesh, West Bengal and Gujarat have been identified as possible opportunity states as they have performed better than national average and also have a high share of untapped growth, according to a release here.

Lack of infrastructure, geographical challenges and population density were certain constraints faced by automotive companies to expand their presence in rural markets, the study said.

source: http://www.twocircles.net / Two Circles / Home> India News / April 03rd, 2013

Coimbatore : 

As the Indian pump industry pins its hopes on a revival of industrial demand and the onset of the South-West monsoon in June to perk up demand from the farm sector, Coimbatore-based Deccan Pumps is preparing to launch a new brand of pumps ‘EKKI’ (which in Tamil means ‘to ascend’) that targets both the agricultural and urban markets.

The company, among the top pump manufacturers in Coimbatore city that accounts for a near 40 per cent market share of the organised pump market in the country, is also looking at opportunities to partner with European pump manufacturers to serve markets in India and abroad.

In an interaction with Business Line, P. Arumugam, Chairman, DPPL, and Kanishka Arumugam, Product Manager, EKKI, a new division of DPPL, said the development of the borehole submersible ‘EKKI+’ was driven by the demand for energy efficient pumps with lower lifecycle costs.

The new borehole range comes in varying diameters ranging from 4 inches to 8 inches and are up to 10 per cent more efficient than the earlier generation of boreholes, making them ‘the best in class’ from 0.5 HP up to 90HP. They expect the ‘EKKI+’ borehole submersibles to contribute to about half the sales of the EKKI brand. The existing ‘Deccan’ brand open-well submersibles, mini submersibles, jet pumps and centrifugal monoblocs would also be sold under the ‘EKKI’ brand name.

The EKKI range of products would be produced at a greenfield facility set up with a capacity to manufacture 6,000-7,000 units a month. While the first phase of the plant was ready, the second phase would be completed in two months.

Kanishka Arumugam said while MNC pump manufacturers dominated the industrial segment, the Coimbatore pump industry has carved a niche in the agriculture, residential and commercial segments. But the industrial segment was alluring because of the scope for value addition.

Deccan was focused on the farm segment at present, though the industrial segment was also on its radar. He felt there were still some pockets in the country where the company’s products had not reached and he would like to tap these markets even while trying to ramp up capacity.

He said some of the leading European pump makers wanted Deccan to supply products under their brand names. For instance, while buying submersible motor parts from India and China, they would produce their own pumps at their own facilities, making Deccan an OEM supplier to them, under their brand name. As the company does not have sufficient capacity to meet domestic demand, it has not embraced the opportunity. But once capacity addition was in place, Deccan was open to the idea of looking at such opportunities in countries where its own brand did not have a market.

He said a few other foreign companies that wanted to enter the Indian market have evinced an interest to forge joint ventures with Deccan. The advantage was that these companies had niche technologies whereas Deccan has manufacturing strengths. He said EKKI would consider ‘growth through joint synergies’ with some of the European family-owned groups. This would also catapult the company from ‘being follower to leader’ by leveraging its R&D and design capabilities.

Arumugam said besides Coimbatore, Ahmedabad was also a major production hub for the pump industry, though Rajkot also had many players. The Central and State Governments have been lending a supporting role, particularly in the manufacture of energy-efficient pumps. But the sluggish business environment has impacted the supply chain and captive foundries have also been slow in meeting their supply commitments.

Asked about the impact of the ongoing drought in many markets, including Tamil Nadu and Maharashtra, he said generally drought drives up the demand for borehole pumps from the farm sector. In Tamil Nadu the ‘sales are actually OK due to drought’ as farmers dig new wells in search of water. But the drought in Maharashtra, an important market for the Deccan brand, has affected sales. But he expected the demand to pick up once the monsoon sets in and distributors there have already begun stocking, expecting a demand revival. He said compared to last year, the overall demand was high for Deccan as farmers have plumped for ‘high performance energy-efficient branded pumps’.

On future growth plans, Arumugam said DPPL completed the spin-off from Deccan Industries on March 31, 2013. This would enable DPPL to focus on becoming the largest producer of vertical open-well submersibles and mini submersibles. He planned to set up a group logistics centre and an additional greenfield facility in the city in the coming fiscal, apart from the three plants it has now.

source: http://www.TheHinduBusinessLine.com / Home / by  R. Yegya Narayanan / April 01st, 2013