Solapur''s Precision Group to supply camshafts to BMW, Porsche

Mumbai: Solapur-based Precision Group, among the largest manufacturer of automotive camshafts in India, has announced having received long-term contracts valued at Rs.25-crore from German auto majors, BMW and Porsche for supplying 240,000 ''profiled hollow'' and 200,000 ''trilobe'' camshafts per year annum.

The company says it is the only Indian company to manufacture hollow camshafts and is a supplier to global automakers like General Motors and Ford.

According to Yatin Shah, managing director, Precision Group, "We have been selected by Porsche and BMW as a source supplier for these components after an exhaustive audit. The present export order of 4,000 camshafts per week from Porsche is expected to grow significantly in the next 12 months. This affirms our customer''s confidence in our capabilities of achieving high tolerances and sophisticated engineering norms thus helping us in expanding our global footprint into new geographies like Europe, North America and South East Asia.''''

The company has also bought out its UK-based collaborator''s 51-per cent stake from the joint venture Clancey Precision Components Private Limited (CPCPL), a major supplier of camshafts to Europen auto majors. With this move, the company now attains the status of a global supplier across India, Europe, Latin America and Korea.

Shah expects this acquisition to strengthen Precision Group''s global presence, while creating new avenues for growth and significant monetisation opportunities for the company.

Shah said, The JV acquisition was an important step for the company''s long-term business strategy since the company faced restrictions on direct marketing under the terms of the JV agreement.

"The acquisition greatly strengthens our position towards attaining global leadership. We are known for our deliverables and will continue to do so. This move has given us the confidence and we will look at further investments and target customers across the globe."

The company says it has a domestic market share of 85 per cent, and expects to manufacture 12 million camshafts each year by 2010, with about 70 per cent of the total revenue coming from the sales to the customers outside India including from global OEMs and tier I customers.

Shah elaborates the company''s post expansion plans, "The company is looking at huge post-acquisition expansion plans with a significant investment of Rs100 crore to achieve the Rs350-crore mark by year 2010. We are planning to increase the headcount by over 1,000 people in the next 24 months, and quadrupling of the current facilities. The expansion of current manufacturing facility in MIDC, Chincholi will commence by the beginning of next year."

According to R R Joshi, head, finance, "The challenge now is to tie-up with a fund that has a long-term view and one that recognises the strengths of this company and its managing team."

The Precision Group was set up in 1992, and is a 100-per cent EOU with a TS 16949 certification. It manufacturers fully finished camshafts from chilled cast iron as well as forging, and steel bar stock. The products are mainly used in internal combustion engines for passenger car engines, tractors, light and heavy commercial vehicle engines, and locomotive engines.