Wheels India to boost capacity

CHENNAI: Wheels India, market leader in steel wheels and a strong player in the global market, will be ramping up capacity by 2 million to 10 million this fiscal with a capex of Rs 100 crore.

Besides consolidating its stronghold in wheels for cars, trucks, utility vehicles and tractors, WIL is betting big on the expanding market for large construction and earth-moving equipment wheels in the domestic and export markets thanks to the bustling infrastructure and mining sector activities.

WIL’s chairman and MD S Ram inaugurated on Monday an exclusive facility set up at Sriperumbudur at a cost of $8 million (Rs 32 crore) for the manufacture of larger wheels for high-capacity dumping trucks and earth-moving equipment. Representing its major customers in the line, Caterpillar vice-president-global purchasing Dan Murphy, Komatsu India MD Susumu Ueno and BEML director-defence business V Mohan were present on the occasion.

JMD Srivats Ram told ET, “The share of the construction equipment business has grown over the years to Rs 170 crore now, of which 75% goes to export markets. Both Komatsu and Caterpillar (which have plants near Chennai) account for two-thirds of this business. A major part of the investment in the new plant will be aimed at meeting the requirements of their growth plans ”

He said the new facility will start with a capacity of 7,000 large wheels and will be expanded to 18,000 wheels in three years. It will produce wheels for dump trucks of capacity between 50t and 100t. While the plant at Padi makes wheels for small and medium construction equipment, the new facility will make wheels for large mining trucks.

The first exclusive facility has been set up taking into account the industrial growth and increasing demand for commodities and input materials like iron ore, bauxite and coal. This will lead to increased mining activities and require capex on mining trucks. In addition, global players have set up plants in India to meet their needs of mining trucks in the region.

Mr Srivats said the company currently has a total production capacity of 8 million steel wheels from its plants at Padi, Rampur, Pune and Bawal (Haryana). This includes 5 million passenger car wheels, 1.7 million truck wheels, 1.2 tractor wheels and 1 lakh earth-moving equipment wheels.

This is to be increased to 10 million wheels this fiscal at a cost of Rs 100 crore. It has incurred capex of around Rs 60 crore in the first six months including Rs 32 crore at the Sriperumbudur facility. It is investing Rs 15 crore at Pant Nagar in Uttrakhand to cater to OEMs like Tata. It is also expanding capacity at Bawal.

In addition, the company has started the manufacture of forged aluminium truck wheels at Padi and its designs are being validated by major truck manufacturers in Europe. Srivats said WIL also expects to double its air suspension business to Rs 35 crore thanks to a growing market from private bus operators and STUs.

Expecting WIL to post a total net sales of Rs 1100 crore this year (Rs 1003 crore in FY07), the JMD said exports are projected to be Rs 230 crore (Rs 183 crore). This is expected to touch Rs 350 crore in a couple of years. It is now exporting to North America, Europe, Asia Pacific and South Africa.