Even the Japanese have woken up to India''s potential as an outsourcing hub
this time for precision tools. Mitsubishi Heavy Industries India Precision
Tools Limited (MHI -IPT), may be just one of those 40 companies in the Mitsubishi
Heavy Industries, but the Japanese group hopes to use it to propel its global
market share in precision tools among the top three globally.
only Japan, Europe and the US had the distinction of producing world class cutting
tools, but India has joined that list," said Hidetaka Horioka, managing director,
MHI-IPT while addressing the media in Chennai today. The cost and quality advantage
offered by India is going to drive `global'' exports from this company, he added.
company got its Indian presence with the acquisition of Chennai-based SRP Tools
in 2005, which was the first ever merger and acquisition by a Japanese company
Tools, which set up its first factory in 1965 to manufacture cutting tools, had
got technology collaboration from Mitsubishi Heavy Industries by 1974. Since then
the company established its brand firmly in the Indian market. It had set up a
factory in Ranipet (120 kms from Chennai) and before getting sold to Mitsubishi
had a turnover of Rs20 crore and a workforce of 270.
the huge domestic market requirements for precision tools, the Japanese company
decided to double existing capacity by investing Rs50 crore towards setting up
an additional plant in the same premises.
India, the automobile /tractor segment is a key client base, all of which are
on an expansion mode. Besides, there were a number of new car manufacturers in
the market to target.
sense that the Indian market will far outgrow the Japanese market in this segment,"
remarked Horioka, who is impressed with the fact that the Indian car market touched
one million units in 2003 and doubled this in three years and is expected to double
again by 2010.
Indian two-wheeler market is also the second largest in the world with 7 million
units. "With the auto segment growing at the rate of 15-20 per cent CAGR
there is a rising demand for high quality gear cutting tools and reduced delivery
lead times, hence the expansion," he explained.
acquisition by Mitsubishi had naturally ensured the bringing in of the latest
technologies in the new state of art fully air-conditioned plant - a definite
advantage to the new entity from global competition.
2008, sales of hobs, shaper cutters, broaches, master gears, broaches (which are
the products of the company) will lead to a quadrupling of the company''s turnover
2015, 50-per cent of the company''s production would be exported and the turnover
would be more than Rs200 crore. Last year the company had clocked Rs36 crore and
this year hopes to achieve Rs60 crore.
the company is having its hands full with the domestic market (this year exports
would be 4 per cent of turnover) and the capacity addition would take of immediate
growing requirements in the domestic front. However, it has plans to set up more
plants, which would come up in North India at a later date.