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Last Updated : Jun 14, 2016 03:08 PM IST | Source: CNBC-TV18

How MRO infra status will help Taneja Aerospace: CEO

MRO contributes 25 percent and the rest 75 percent is chipped in by the manufacturing segment to the overall business, says Sudhir Kumar, the CEO of Taneja Aerospace in an interview to CNCB-TV18.

Under the draft National Aviation Policy, the government has given maintenance, repair and overhaul (MRO) infrastructure status to Taneja Aerospace.  

The company doesn't have to pay service tax and import duty for three years.

Sudhir Kumar, the CEO of  the company, said that the MRO space contributes 25 percent and the rest 75 percent is chipped in by the manufacturing segment to the overall business.

He expects the revenue for FY17 to be over Rs 70 crore, an increase of 20 percent.

Below is transcript of Sudhir Kumar’s interview with Nigel D’souza on CNBC-TV18.

Q: Could you give us what exactly is the implications? As we are aware, you are the only maintenance, repair and overhaul (MRO) player in the country and now the government will give MRO infra status, that is zero service tax as well as zero import duty for three years. What exactly was the service tax currently if it is going to be scaled down to zero and also, what is the import duty currently and what kind of a difference can it make to your business going ahead?

A: At Taneja Aerospace, we have two segments. One segment is dealing with the manufacturing activity. There we undertake manufacturing of the assembly, sub-assembly, parts - metallic and composite - as well as we undertake the MRO of the small side business, the Aircrafts produced by our company as well as other aircrafts like Cessna, we are undertaking the MRO activities of that. So, as far as any reduction in the government taxation, that makes us comfortable and we become at par with the major players in the neighbouring countries.

Q: This is a draft guideline, so how soon do you expect this to be implemented. Also, I did not get that number, what is the current import tax that you are paying? Could you give us those details?

A: I look after the manufacturing segment of Taneja Aerospace. The MRO segment is being dealt by my colleague. So, I will not be able to give you the exact digits what are the taxation details.

Q: Could you give us a breakup of the total revenues? Last year we saw big jump in the revenues from around Rs 30 crore all the way to around Rs 60 crore. How much of it was coming from the manufacturing business and also could you tell us how much of it is coming from the MRO side of the business, what is the breakup? 50:50 percent, 40:60 percent?

A: Around 25 percent is from the MRO segment and 75 percent is from the manufacturing segment. The jump in the revenue is of course -- the Indian needs are increasing in the field of defence, in the field of aerospace and the initiative taken by the government of India certainly is helping the Indian industry.

For full interview, watch accompanying video

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First Published on Jun 14, 2016 11:56 am
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