Raymond Is Targeting a Five-Fold Growth in Its Engineering Division's Turnover

Gautam Singhania-led Rs. 4,200-crore textile giant Raymond Group is planning a major expansion in its engineering business. Raymond is targeting a five-fold growth in its engineering division's turnover to Rs. 3,000 crore from the current Rs. 600 crore over the next five years. The group is looking towards acquisitions, product expansion and manufacturing plants overseas to drive growth. Harshal Jayawant, President, Raymond engineering business told Hindustan Times that the company plans to invest Rs. 1,000 crore to Rs. 1,500 crore to fund its growth plans in the coming years. The company is in talks with private equity players and is also considering an initial public offering (IPO) of shares for its engineering business in the medium term, "subject to it achieving a certain size", said Jayawant. "We are looking to acquire another forged machine parts maker of medium size in India, while we are looking to acquire engineering technology firms abroad," he said. Earlier this year, Raymond acquired Pune-based forged component manufacturer Trinity for Rs. 54 crore. Raymond's 63-year old engineering product company JK Files & Tools commands 30% of global market in cutting and precision tools business. It diversified into auto component business in 2005 by acquiring Nasik-based Ring Plus Aqua that makes starter gears and shaft bearings. With a client list including General Motors, Fiat, Caterpillar and Tata Motors, the company now plans to expand its Indonesian plant while setting up another plant in Brazil. About 60% of revenue for Raymond's engineering business comes from overseas, mainly US and Europe. "We are very bullish on Europe. They are going through a difficult phase and looking for competent low cost manufacturing sources. India stands a good chance. In 2008 downturn, our business in Europe grew four times," said Jayawant. Source: Hindustan Times