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LML plans 2-wheeler plant in Egypt

NEW DELHI - Indian automaker LML Ltd plans to assemble and sell its two-wheelers, including the Freedom motorcycle, in Egypt and Colombia next year as part of strategies to grow its exports business three-fold to 10 percent of turnover by fiscal 2006, senior company officials said.

"We will enter Egypt some time next year with 115cc metal-bodied geared scooters. Colombia is also on the anvil," said the company's managing director Deepak Singhania. The assembly units would be set up by LML's distributors in the two countries, with the Indian two-wheeler maker having minority stake.

"The distributors will make the majority investment. We will have 20-30 percent equity in the venture," LML's executive director (Corporate Affairs) Rakesh Jayal said.

Riding high on strong demand for its 110cc motorcycle Freedom, LML expects to more than double its motorcycle sales to 240,000-300,000 units this fiscal. The company is investing Rs 1.25 billion (US$27 million) to increase its motorcycle production capacity to 400,000 units and launch two new motorcycles by the end of the year, Singhania said.

LML has sold 109,000 motorcycles during 2002-03, the bulk of which comprised the Freedom, its first locally-produced motorcycle. The Kanpur-based firm has a technical alliance with Korea's Daelim Motors to produce the Adreno and Energy range of motorcycles.

The firm would initially launch its 115cc scooters in Egypt, Jayal said, adding that its highest-selling 110cc Freedom motorcycle would be launched in Colombia next year.

"We expect to increase the contribution of exports to 10 percent of turnover by 2005-06 from 3 percent now," Jayal said.

Singhania said the entry into Latin America has been delayed due to the currency crisis in the region and constraints on production capacity, which would be increased to 400,000 units in this fiscal. He said an entry into Colombia would allow LML to access other markets in the region.

(Asia Pulse/PTI)

Jul 25, 2003

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