COMPANY LAW
| Novelis to make India debut in October Tue, 15 Feb 2011 00:44:09 +0530 |
| Come October, Hindalco will bring Novelis, its Atlanta-based subsidiary and world leader in aluminium rolling products, into india. Tapping the fast growing flat rolled aluminium products market in the country, with applications in the automotive sector, beverage cans and electronics, among others, Hindalco is setting up a 500 kilo-tonne per year plant in two phases, with an investment of $130 million (Rs 600 crore) in its first phase. The first phase will have a capacity of 135 ktpa and will be up and running by October. The rest will follow as the demand goes up. The plant was originally set up in Rogerstone, Britain, but was dismantled and the machinery is being brought to India, as it was a high-cost plant and couldn’t survive competition from low-cost producing countries such as China. The project is underway for the transfer of all key equipment for flat rolled production to the new unit at Hirakud, Orissa. Orders have also been placed for other equipment to balance production. Says Hindalco, “This will enable the company to produce a wide range of superior engineering products, including can-body stock, for the local and export markets.” Said Debnarayan Bhattacharya, managing director of Hindalco (and vice-chairman of Novelis), “The products will be sold by Novelis, as they are a known brand. We will have to make sure where do we get the maximum benefit for Hindalco and Novelis together. We will look at the export market from this plant itself.” Currently, the demand for can-body products in India is 1.2 kg per capita as against 12 kg per capita in China. “Even if we produce half of what is consumed in China, our production will go up by six times,” he said. The $600-crore investment at the Hirakud plant is for the first phase of the project and the investment plans in the second phase are being firmed up. Bhattacharya said, “It will be internal accruals to begin with and we may go for project financing for the second phase. The objective is that as the market develops, either in India or abroad, we will produce more. As soon as we see that we need to produce more, we will take the capacity up in a modular fashion.” Adding: “The can-body is one of the toughest things to produce in the world and also takes a lot of time to get approved by customers.” He said there currently were just two factories in India producing cans, one of Rexam, which uses steel to make cans and the other by Can-Pack, which uses aluminium. |
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