Dunlop India gears up to jack up production this year

Kolkata, Jun 15 : In its effort to place itself as the world's largest producer of 2/3 wheeler tyres, Dunlop India Limited, through its subsidiary company Falcon Tyres Limited, has decided to set up a new plant in Uttranchal and upgrade the capacity of the Falcon's Mysore unit with a total investment of about Rupees 850 crores this year.

This was announced by Dunlop India Chairman Pawan Ruia while speaking to the newsmen after the former tyre major's 83rd Annual General meeting here today.

Referring to the huge demand for car and two-three wheeler tyres in India in the post recessionary period, Mr Ruia said following the establisment of the new plant, about 30 kms from Haridwar in Uttranchal, and upgrading the capacity of Falcon Tyres existing Mysore plant the total production capacity for two/three wheeler tyres would go up from the present 150,000 pieces a month to over 230,000 pieces.

Of them the new plant, to be set up with an investment of Rs 500 crores, would produce 150,000 tyres, while the rest would be manufactured in Mysore unit where about Rs 350 crores would be pumped in this year to jack up the production level, Mr Rua said.

Asked about the process of funding the new projects, Mr Ruia said while majority of Rs 850 crores would generate from a Rights issue, the rest would come from different financial institutions and banks as long term credits.

''However, we are yet to decide on the size of the rights issue,'' he said while replying to a related query.

Furthermore, Mr Ruia said, majority of the products would be supplied to Hero Honda, while the rest would be sold to other major two wheeler units.

Asked about his plans for Dunlop India's Sahagang and Ambattur plants, Mr Ruia said following the start of regular production in both the factories late last year after years of dilly-dallying, the production volume had touched the level of 30 to 40 tonnes a month at each place.

''After a number of successful initiatives taken by the company as well by the respective governments we are confident of increasing the monthly production in both the factories to 60 to 70 tonnes a month in this fiscal itself,'' Mr Ruia said and added that at present the demand had surpassed the capacity to supply from both the plants.

''In view of the past troubled history of both the units, we first want to stabilise the situation before going in for mass expansion of our capacity to meet the growing demand for four wheeler tyres,'' Mr Ruia clarified.