Auto component maker National Engineering Industries Ltd (NEIL), a C K Birla group firm, is investingRs 100 crore over the next three years for producing needle roller bearing at its Jaipur facility, according to a top company official.
The company, which is entering the needle roller bearing segment with the help of NTN Corporation's licensed technology, expects sales from the vertical to be around Rs 50 crore in the next year and subsequently scale it up to Rs 100 crore.
"Now that we are entering into this needle roller bearing segment, we have a complete portfolio. This was the only piece missing in the automotive segment. In the needle roller segment, we will be investing about Rs 100 crore specifically in the next three years," National Engineering Industries Ltd (NEIL) Presidentand CEO Rohit Saboo told PTI.
He said the company has an ongoing overall capex plan of Rs 330 crore in three years and the investment in needle roller segment will be a part of it.
When asked about expectations from the new segment, Saboo said, "This year it will be rather small because there will be some trial and testing done. From next year, we are looking at starting from Rs 50 crore and subsequently going up to Rs 100 crore."
The company is setting up the capacity for the new segment at its existing plant in Jaipur, he added.
Needle bearings are smaller than general bearings and have greater load carrying capacity. This allows compact designs and these items are useful for applications which require smaller inertial force such as in an engine crankshaft.
On the overall market conditions, he said, "In the new fiscal people are expecting that upturn will come in the second half of the year, especially around Diwali."
Overall, he said, "We are still bullish that tide will turn very soon, maybe end of the year or early next year and then the requirement will go back again up."
As for the company's total sales, Saboo said, "In the ongoing fiscal we are expecting sale of somewhere between Rs 2,050 crore and Rs 2,100 crore. Next year we are expecting a growth of approximately 7 per cent out of which we are hoping that 5 per cent will be the automotive growth.
The rest 2 per cent, he said, would be through wallet share increase industrial segment.
He also said NEIL would look to tap new entrants such as Kia Motors and MG Motors for supplying its products.
"We are either in discussion or will be in discussion with all these people and we will hopefully start engaging with them and developing bearings for them by later part of the year," Saboo added.
When asked if the company will export its needle bearings, he said, "We will be definitely looking at it as most of our export customers are in automotive.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)