Sintex eyes overseas acquisition by March 07

Sintex Industries Ltd, a major player in plastic and textiles segments, will finalise one of its overseas acquisitions by the end of March 2007.

Talking to Business Standard, Amit Patel, managing director, Sintex, said, "We expect to strike a takeover deal with at least one company by the end of March 2007." The company is aggressively looking out for a possible overseas acquisition.

"We are in talks with four companies "" three in Europe and one in the US. Our overseas acquisition will be for an electric engineering and auto ancillary company," said Patel.

The company has set aside a sum of US $50 million for the takeover. Sintex generated Rs 70 crore revenue from its auto ancillary product sales and expects the sales from auto ancillary products to increase further to Rs 110-Rs 150 crore by next year.

The company also plans to invest Rs 200 crore for the capacity expansion for its shelter manufacturing unit in India. Last year, the company acquired 74 per cent stake in the Indian arm of Germany-based Zeppelin Mobile Systeme GmbH.

The Indian arm of Zeppelin was engaged in the business of designing and commissioning of shelters for the telecom sector, mobile hospitals, refrigerated bodies and other multi-purpose shelters.

"We will increase the production capacity from 3,000 shelters to 6,000 shelters by December 2006. After reaching 6,000 shelters capacity, it would be further increased to 9,000 shelters by the end of year 2007," he said.

The company has chalked out other expansion plans as it will invest Rs 200 crore in its textile division and Rs 250 crore for its fabrication, building and construction division over a period of next five years.

While the funding of expansion in the plastics segment would be through internal accruals, the textile division's expansions would be funded through borrowings and the Textile Upgradation Fund (TUF) scheme.

For the quarter ended September 30 this year, the company posted 93 per cent increase in net profit at Rs 31.5 crore as against Rs 16.3 crore for the corresponding period in the last fiscal. Net sales increased by 49 per cent.