Auto components maker Motor Industries Company Ltd (Mico) will take a decision on setting up a facility in Uttaranchal in three weeks, according to M Lakshminarayan, joint managing director. | |
| Auto majors such as Bajaj Auto and TVS Motors are also setting up their units in Uttaranchal. Lakshminarayan said Mico had undertaken a cost benefit analysis, as the initiative involved a huge investment. |
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| He pointed out that the company already had plants in Bangalore, Naganathapura, Jaipur and Nasik that cater to its domestic as well as export markets. |
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| In January 2006, Albert Hieronimus, managing director, Mico, had announced that the company would invest Rs 1,000 crore in its existing auto component facilities over the next three years. |
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| It is the ten-year sales tax break offered by the Uttaranchal government that is attracting the auto majors to the state. |
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| Lakshminarayan said the tax break was a good sop but it really was the proximity to the auto major's units that played a crucial role in Mico zeroing in on the state. |
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| The company had already set up its plant at Jaipur in Rajasthan eyeing similar tax sops. |
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| Last week, Sundram Fasteners Ltd, another Chennai-based auto component company, had said that it would set up a plant at Pantnagar Integrated Industrial Estate in Uttaranchal. |
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| The facility would help the company service the requirements of Telco, Mahindra & Mahindra and Bajaj Auto units, among others. The facility will manufacture high tensile fasteners, powder metal parts and water and oil pumps. |
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| A senior officer with Sundram Fasteners said details of the projects such as cost and financing pattern were being worked out. These would be ready by August or September. |
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| He said a plant in Uttaranchal would enable the company to make its presence felt in the northern region, where it has no visibility at present. |
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| Mico reported 28 per cent increase in its sales for 2005 at Rs 2,978 crore with the profits before, interest, depreciation and tax rising 6.5 per cent at Rs 670 crore. |
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| Total turnover increased to Rs 3,102.1 crore during the year compared to Rs 2,435.5 crore in 2004. Auto parts business contributed Rs 2,746.93 crore in 2005 as against Rs 2,150.42 crore in the previous year. |
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