Chennai: With internationalisation and diversification as its growth strategies the Austrian hydraulic lifting, loading and handling systems manufacturer, the €585.2 million turnover Palfinger AG has set base in India.

Joining hands with $400 million Western Auto LLC, Dubai, the vehicle dealership arm of ETA Star group, Palfinger has promoted a joint venture company in India called Star Palfinger Equipments India Pvt Ltd to import, sell and service knuckle boom and hook loaders in India.

Palfinger holds 26 per cent and Western Auto holds 74 per cent stakes in the JV. The two have invested around €1.2 million in this venture.

Headquartered in Chennai, Star Palfinger would import the knuckle boom cranes and hook loaders from Palfinger, Austria.

"Globally Palfinger commands 30 per cent market share in the articulated crane segment," A J Kamal, director, Western Auto told the media here on Tuesday.

Wolfgang Pilz, chief marketing officer, Palfinger group said, the current market volumes does not warrant a plant in India.

According to him, the total Indian market for articulated cranes and hook loaders are around 150 units per year and for Palfinger to set up production base the volume should be anything between 500-700 units per annum.

In India Star Palfinger would target the construction and the infrastructure sectors where the articulated boom cranes could be put to use, said M Jahufar Buhari, director & CEO, ETA Star Western Auto.

The company will gradually expand its presence across the country on its own and also appointing dealers.

In the first phase the company will set up its operations in Delhi, Mumbai and Kolkata. The four metros will be serviced by Star Palfinger directly.

In the second and third phases the company would set up operations in Bangalore, Hyderabad and in other parts of India.

While the four metros will be serviced directly, Star Palfinger would appoint dealers, preferably those who sell commercial vehicles in other places, said D P K Menon, business head.

The company hopes to do a turnover of around Rs100 million by 2008 selling around 70-100 units, added Buhari.

India could be a component base For Palfinger the Indian joint venture will be a learning experience not only about the market but also on the vendor base here.

Wolfgang Anzengruber, CEO and member of the executive board, says, Palfinger is interested in sourcing hydraulic cylinders, pumps, hoses, cables, tanks are some of the components the company would be interested in sourcing from India.

He says the contribution of the Asia Pacific region to the company''s total turnover is very minimal now. "In five years we expect the region to contribute around 20 per cent of our turnover. We are in Asia at the right time."

He says Palfinger has strong market in Russia, Europe and South America.

Yesterday Palfinger had announced the acquisition of German company MBB Lift Systems, AG manufacturing tail lift products used largely in the transportation sector.

"We acquire companies to fill up the gaps in our product range or to gain market share," reasons Anzengruber.

The company entered China in 2006 with a hook loader assembly plant at an outlay of Euro 25 million.