Chennai, Nov 5 (IANS) Venturing into aftermarket with branded automotive wheels, rationalisation of production across its plants, focus on energy sector-thermal and wind-investment for cost reduction are the thrust areas for Wheels India Ltd., a company official said Monday.
Speaking to reporters here Monday, Wheels India managing director Srivats Ram said: "We have got into the automotive wheels aftermarket with a separate brand Wilgo. While a group company will handle the distribution we will lease the warehouses for stocking the wheels."
According to him, the company earned around Rs.20 crore selling in the replacement market.
As a part of cost cutting measures, Wheels India has decided to rationalise production across its six plants based on the kind of clients - cars, trucks, tractors and others - nearer to the plant.
"All our additional investments will be on cutting costs. Rationlising production across our plants is one of the new initiatives," Ram said.
To a query whether the company would be setting up a plant in Gujarat where its client Ford India is putting up a new facility, Ram said the company has not finalised any such plans.
However, he added that Wheels India will certainly align its plans with that of its clients.
Ram said the company will be focusing on export market for the windmill components while looking at new clients like NTPC apart from power equipment major Bharat Heavy Electricals Ltd. (BHEL) in the thermal energy segment.
"We make the components for the windmill nacelle," Ram said.
Referring to the fall in the company's net profit for the first half of the current fiscal he said: "The company was impacted by the slowdown in the Indian economy that resulted in a 18 percent drop in the medium and heavy commercial vehicles market, a five percent drop in the agricultural tractor market, with a marginal growth in the car and utility vehicle market."
Though the company's exports logged around 40 percent, it was not sufficient enough to compensate for the fall in the domestic market.
During the first half of the current fiscal, Wheels India posted a turnover of Rs.1,017.72 crore and a net profit of Rs.17.53 crore as compared to Rs.966.72 crore and Rs.18.17 crore respectively posted during first half of 2011-12.
According to Ram, the company will be closing this fiscal with a top and bottomline similar to that of previous year.
"Our focus on export market is on the wheels for mining and construction equipments. The market for these equipments has gone down overseas. We expect to post an export revenue of around Rs.321 crore this year, similar to that of last fiscal," Ram said.
The aftermarket provides a wide variety of parts of varying qualities and prices for nearly all vehicle makes and models on the road.