Pune, Feb 23: The Kirloskar group is talking to its joint-venture partner for the Toyota car project, to source the vehicle's engine from Kirloskar Oil Engines Ltd (KOEL), chairman Vijay R Kirloskar said. He added that the group would set up trading offices in south-east Asian countries as a first step towards possibly manufacturing its products there. He also allayed doubts over the group exiting from any of its present activities.Kirloskar, who was in Pune to attend the extraordinary general meeting (EGM) of KOEL said that discussions were on with Toyota to source the engine from the group company, which otherwise would have to be imported. KOEL has the engine's prototypes and systems are being evaluated.
The group will leverage its brand-equity through Kirloskar Systems, which will be the in-house component-developer for the joint venture.
Kirloskar added that the group had approached the Reserve Bank of India (RBI) for permission to open offices in Vietnam, Phillipines and Myanmar. Initiallly, theoffices would be trading outfits. They would be in place by June 1998 and market Kirloskar products like diesel and electric-pump sets, machine-tools and transformers.
Depending upon the demand, they would also go in for assembly and local manufacture of the products.
The idea is to target new high-growth areas of south-east Asia, Kirloskar said. The group already has offices in Singapore, Indonesia, Malaysia and is looking to expand its area of operations. While Kirloskar declined to give figures, he said the group's turnover would be about the same as last year's, with some companies posting a positive growth, while others a lower. He added that the group would do "a lot better than most other companies."On growth prospects, he pointed to Kirloskar Brothers Ltd (KBL), which has received an order from Laos for $12 million. The West Asia market also has good opportunities, Kirloskar said.
Regarding news reports about the group's restructuring exercise, which could see it exit from non-core actities,Kirloskar said there would be no disinvestment or sell-off. He said the difference was between core and growth businesses. While the former would be built up, the latter was those in which the group "would like to stay on, in one way or another." He said they could, however, find partners to develop these, hinting at the creation of more joint ventures.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
