Konecranes lines up Rs 100 crore expansion plan

MUMBAI: Finnish crane company Konecranes will invest Rs 100 crore (¤15 million) over the next year to expand capacity in India as part of its strategy to offset a slowdown in the US, its mainstay market.

The company on Wednesday said it has completed the acquisition of Mumbaibased WMI Cranes for about Rs 400 crore. Konecranes had bought 51% stake in WMI from the Vazirani family in February for Rs 169 crore, with an option to acquire balance stake by the end of the year.

“Looking at India’s industrial investment, growing ports and given the fact that the current base for the crane market is very low, it will grow faster than other economies,” president and chief executive Pekka Lundmark, told ET. “That is why we have decided to make the investment in the plant here.”

Weaker-than-expected earnings in the quarter ended September has forced the company to cut its profit guidance for 2011. Konecrane plans to double capacity at its unit near Pune to manufacture 1,000 cranes every year by the end of 2012. The Indian unit would be developed as an export hub for other geographies, particularly the Middle East. The company estimates the size of the global crane market at ¤10 billion, with India accounting for only 3%.