Hero MotoCorp Ltd., the leading two wheeler manufacturer has announced that the company would be setting up a Global Parts Centre (GPC) at Neemrana in the northern Indian state of Rajasthan.
“We will be setting-up a state-of-the-art Global Parts Centre spread over 35 acres at Neemrana with an initial investment of Rs 160 crore,” Mr. Pawan Munjal, Managing Director and Chief Executive Officer of HMCL said at the company’s Global Supply Chain Partners Conference-2012 (GSCPC), at St Petersburg, Russia.
“The highly-mechanised, technologically-superior GPC will be a new industry benchmark once it becomes fully-operational,” Mr. Munjal said while addressing an audience of over 200, including more than 125 top component suppliers of HMCL. These component suppliers of the company – drawn from India, China, Thailand, Japan and Europe – have converged at this historic Russian city to attend the three-day global conference held at the majestic National Congress Palace.
The GPC, which is expected to be operational in the third quarter of the next financial year (2013-14), will initially employ 400 personnel. The state-of-the-art GPC will have automated storage and retrieval system, automated packaging and sorting system, on-line tracking of parts through Warehouse Management System (WMS), lean manufacturing systems and most importantly, the Green Building Concept.
“Our supply chain partners have over the years enhanced product competitiveness and contributed significantly to value creation in our business. They have been our Partners in Progress. Now, as we embark on our ambitious global expansion plan, they are also going to play a significant role in this strategic move,” Mr Munjal said.
The company also informed its supply chain partners that it will set up the fifth plant at Halol in the western India state of Gujarat, in addition to the fourth plant at Neemrana in Rajasthan.
The proposed Global Parts Centre comes close on the heels of HMCL recently announcing an investment of over Rs 2500 crore in setting up two new plants, expanding capacity at existing plants and in building an integrated R&D centre (at Kukas in Rajasthan). With this expansion, total installed capacity of the company would be touching more than nine million units in two years’ time – which is in line with the stated objective of reaching 10 million units in the next five years.
The proposed new state-of-the-art integrated R&D centre at Kukas will be set-up over an area of 250-acre and the centre will be the largest two-wheeler R&D set-up in the country, and will employ over 500 engineers.
Riding on its highest-ever quarterly volume sales of 16,42,292 units, supported by two consecutive months of highest-ever sales, HMCL last week reported its best-ever turnover (Net Sales & Other Operating income) of Rs. 6247.28 crores for the first quarter (April-June 2012) of FY’13. This is a growth of 9.95 per cent over the corresponding period in the last fiscal (April-June 2011) of FY’12. The company’s profit before tax for the period stood at Rs 734.88 crore, while profit after tax (PAT) stood at Rs 615.46 crores. The Company recorded an EBIDTA margin of 15 per cent.
Source: HMCL