Kirloskar Pneumatic exits central air-conditioning business

In a bid to restructure its business and get out of areas that have less potential or margins, Kirloskar Pneumatic Company Ltd is exiting the business of contracting of central air conditioning, thus limiting itself to supplying the products.

The company''s decision to get out of the central air conditioning business has stemmed from the fact that it has low margins. Mr. Rahul Kirloskar, chairman, addressing shareholders at the annual general meeting in Pune said, "This business contributes very little, and only adds to the losses." During the financial year 1999-2000 this area of business had contributed Rs 8 - 10 crore towards the sales of the company, but did not add to the profits.

Simultaneously, the company is looking at non-conventional energy as a thrust area, with special attention to windmill gearboxes. With strong government support for non-conventional energy generation, a number of private sector organisations have entered the business. "We are the only manufacturers of windmill gearboxes in the country," said Mr. Kirloskar, adding, "If the sector clicks, it could contribute to a business of Rs 50 crore." KPCL has already supplied 15 windmill gearboxes to different companies.

KPCL, which was in business of air compressor, air conditioning and refrigeration, and transmission gearboxes (other than locomotive), began its restructuring last year, when it got out of the air compressor business by licensing it out to K G Khosla Compressors Ltd.