Hinduja Group plans global foray

By Sumantra Barooah/CNBC-TV18

The Hinduja Group is getting busy on transforming itself from a passive holding company to an aggressive player in the automotive business. In his first exclusive interview as Hinduja Automotive's Vice-Chairman, V Sumantran explained why the group is focussing on engineering and design services to go global.

After engineering new cars for General Motors and Tata, Sumantran has for a change found a non-R&D role for himself. He will be strategising for global expansion of the Hinduja Group's automotive business. No wonder that technology is on top of his mind as a means to achieve that goal.  So, Albonair -- Hinduja Group's three-month old R&D hub in Germany's Dortmund is already working on after exhaust treatment with technology like Mercedes Benz's Blue Tec, that will help manufacturers like Ashok Leyland to meet strict emission norms abroad. That also indicates Ashok Leyland's plans to up its own plans for presence in developed economies.

"In India, we have focussed on Euro-IV. Euro-V will be in Europe by 2010," Sumantran said.

That's why Sumantran says the group is investing in technological expertise to assist Ashok Leyland, as well as service other manufacturers. For example, Albonair's team will be more than doubled to 60 in a year and a 100 more people will be added to the existing 150 in Aedis - the Chennai-based tech centre. Activities in its Detroit testing centre- Defiance and the Ashok Leyland-Continental JV for automotive electronics will also be ramped up.

Hinduja Automotive is an example of how automobile majors are now increasingly focussing on allied activities like R&D and design apart from enhancing manufacturing efficiencies to be more competitive in India and also to go abroad. Along with the engineering services, the automotive group is also stepping up activities in its other divisions

Hinduja Foundries, its component business, plans to ramp up its current capacity of 120,000 tonne to 270,000 tonne in three-years and an acquisition or two in this space is also expected during this year. "In the automotive business today, the centre of gravity is closer to India, but that will obviously evolve over time," Sumantran said. 

For growing inorganically, Hinduja Automotive may raise around USD 2 billion from its companies.