Hyundai to invest Rs 260cr

The Hyundai Heavy Industries (HHI), a subsidiary of Hyundai Group of Korea, has signed a memorandum of understanding (MoU) with the Maharashtra government to build a construction equipment plant in Pune's Chakan belt for Rs 260 crore.

The factory will manufacture hydraulic excavators and plans to add up the production lines for other construction equipment later.

Principal Secretary (Industries) V K Jairath signed the MoU on behalf of the state government while K H Park, COO and Senior Executive Vice-President of construction equipment division of HHI signed on behalf of the Korean giant.

Production will commence in the next two years with initial production capacity of 3,500 units per year. The facility will include fabrication shop, assembly lines and a paint shop.

Within the next five years, the portion of local components application is expected to reach 80 per cent.

K H Park said, "We hope to increase our corporate value through the operation in India and expect it to be a sustainable growth in the future. The manufacturing unit will also export to West Asia, south east Asia and Africa."

J S Kim, Managing Director of the new company said, "Our new plant will serve the core global business of Hyundai Construction Equipment division which will help us accomplish HHI's vision."

According to company estimates, the demand for construction equipment in India mirrored the demand in China, where Hyundai Heavy Industries controls nearly 18 per cent of the market.