Indian tyre firm to expand production in Lanka

CEAT Sri Lanka, a unit of India's RPG Industries, plans to expand its production by a fifth with an investment of nearly  $five million, the company said today.

The investment follows strong sales growth over the past two years and plans to enter European and Latin American markets, the company said.

"We want to expand production by 20 per cent for exports and the domestic market," CEAT Sri Lanka managing director Randeep Narang was quoted as saying on the Lanka Business Online portal.

He said the production jumped to 1,50,000 tyres a month, up from about 1,25,000 a year earlier.

April 2009 to March 2010, exports had grown 96 per cent and the volumes were being maintained this year, he said.

"This year itself we will invest Rs 400-500 million".

About 35 per cent of the production is exported to 20 countries, including India.

Last year, the firm had entered new markets in Egypt, Syria, Cambodia, Nigeria, Singapore, Dubai and Vietnam.

CEAT Sri Lanka is a 50:50 joint venture between India's CEAT and Sri Lanka's Kelani Tyres.

Last year, CEAT bought the full rights global rights to its brand from Pirelli.

"We are now looking at entering European and Latin American markets," Narang said.