Capacity hike in progress with increasing turnover
Pee Aar Exim (PAEI) is a joint venture of Spal, Italy, with the Pee Aar Exim Pvt. Ltd. of India, in which the former has 70 per cent stake in the equity and the latter the remaining 30 per cent.
PAEI has the technical know-how to manufacture condenser and radiator motors, SFA and blowers for automotive applications, and is committed to working on new technologies to develop products as per customers’ demands. Its annual capacity has grown from 0.18 million SFA units to the current 0.72 million SFA units.
PAEI is a supplier to leading air-conditioning companies like Subros, Delphi, Behr, Spheros and Sidwell that in turn supply to vehicle manufacturers such as Tata Motors and Mahindra.
The company has invested Rs. 20 crores, with a further expected investment of Rs. 10 crores towards injection moulding machines, a motor line and an assembly line.
It is also keen on exploring the huge potential in the bus and offroad segments with its products currently being exported to China, Singapore, Brazil, the UK and Russia.
The company has its manufacturing facility in Pune with a monthly capacity of 100,000 fan and blower assemblies and currently makes 40,000 assemblies. There is also good scope for increasing the plant capacity, with just 30 per cent of the land space currently used while 70 per cent is available for expansion which could result in production capacity touching a whopping 500,000 assemblies per month. Work has already begun on ramping up monthly plant capacity to 300,000 assemblies since Spal is keen on catering to the European and South American markets using the facility.
PAEI is sharpening its focus on radiator fans as they could be used both with condensers and radiators. The company is working with India’s leading commercial vehicle manufacturer by supplying ventilation systems to its LCV division. PAEI is also exploring ways of reducing manufacturing operations for its customers by providing them value additions and added benefits. “We don’t wait for customer business. We will first expand, establish ourselves and then approach OEMs”, said Mr. Pankaj Rustagi, Managing Director, PAEI, on a confident
note.
The JV company achieved a turnover of close to Rs. 30 crores in 2011-12 and has set a target of Rs. 300 crores in the next five years.
Spal, a global giant, is looking at sourcing more components from the Indian market. The company took over 51 per cent stake in PAEI in 2006 and raised it to 70 per cent in 2011. Even with a majority stake in the JV, Spal realises the importance of its Indian partner and is confident of working with the local company on a long-term basis.
Spal’s confidence and close association with its Indian partner is well reflected in the fact that, even with a 70 per cent stake in the JV, there is no Italian employee working in PAEI. With such a good understanding between the partners, PAEI has the right platform for a successful run in the Indian market and is poised to further expand operations across the globe in the next few years.