Ashok Leyland and Alteams form casting joint venture

03 July 2007

Chennai: Chennai-based commercial vehicle manufacturer Ashok Leyland Limited and Finland''s €130-million turnover Alteams group have teamed up together to make high pressure die casting (HPDC) aluminium products for automobile and telecom sectors.

The two have formed a 50:50 joint venture for this purpose and the plant will be located near Chennai. During the first phase to be completed by 2008 the yet to be named joint venture company would invest around Rs175 crore. The debt: equity for the project will be 1:1 and the partners will bring in equal amount towards the project cost.

"The JV reflects the expansion of Ashok Leyland Group''s presence in the auto components sector to take advantage of rapidly growing opportunities both in India and abroad," said R Seshasayee, managing director, Ashok Leyland.

According R Seshasayee, the total investment into the project at the end of second phase around 2013 would be around Rs335 crore and the company''s turnover would be around Rs650 crore. The venture is expected to generate direct and indirect employment opportunity for 1,000 people.

The manufacturing facility in Phase I has been planned in Tamil Nadu and the JV will produce components for the telecommunications sector such as those fitted in the transmission and receiving equipment. It will also partly meet Ashok Leyland''s own captive requirements for components for engines and gearboxes.

In Phase II, the joint venture will enhance its product portfolio with HPDC components for automotive sectors including passenger cars and for non-automotive applications as well. The target markets will extend beyond India.