Saturday, 16 May 2009

Elecon Engg to invest Rs 100 cr in windmill biz,expects 20% growth

Ahmedabad, May 15 Elecon Engineering Company Ltd, leading materials handling equipment, industrial gears and transmission products manufacturer, said it expected to grow by 20 per cent with sales target of Rs 1,150 crore, including around 8 per cent from exports, in 2009-10.

Elecon’s average growth over the last three fiscals was 32 per cent.

The company is investing nearly Rs 100 crore in the windmill gear business and foraying into manufacturing 1-2 MW capacity wind mill gear boxes as an import substitute, said Mr Prayasvin Patel, Chairman and Managing Director of the Vallabh Vidyanagar-based company, here. The company is also developing a wind farm at Narayan Sari in Kutch where it has bought land.

However, the wind energy business being a risky proposition due to unpredictability of wind, dependability on subsidies and other factors, this endeavour would continue to be only a part of Elecon’s business.

“We don’t want to become a major player in the wind mill business,” he added.

As on March 31, 2009, Elecon Engineering, which leads its sector with 26 per cent market share, had an order book of Rs 200 crore, including Rs 24 crore from international companies while its unexecuted order value was Rs 1,627 crore. Export order booking and invoicing target for gear division during 2009-10 is around Rs 90 crore and Rs 50 crore, respectively.

The company has received business-related inquiries worth Rs 3,000 crore.

Currently it is manufacturing two large marine gear boxes for the Indian Navy’s ambitious first indigenously-made aircraft carrier at Cochin Shipyard with delivery expected in the next six months.

In 2008-09, the company’s sales revenues were Rs 955.06 crore (Rs 826.43 crore). Its PAT was down to Rs 57.45 crore (Rs 67 crore) due to high interest rates and volatility of foreign exchange market, among other factors. The company is paying 75 per cent dividend, as in the last fiscal, Mr Patel added.

Source : BL

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