Tata Hitachi Construction Machinery announced that it would invest Rs 200 crore in its two manufacturing plants to enhance quality, innovation, and localisation. This investment aims to increase the localisation levels to 70% over the next 2-3 years. Tata Hitachi is a joint venture between Tata and Hitachi of Japan, with Tata holding 40% and Hitachi holding 60%.
Investment Details
Managing Director Sandeep Singh stated that the company would invest Rs 200 crore in its plants located in Kharagpur, West Bengal, and Dharwad, Karnataka. This investment will help Tata Hitachi stay at the forefront of innovation and increase self-reliance, or “Atmanirbhar,” from the current 65% to 70% within the next few years.
Production and Localisation
Tata Hitachi plans to start producing 60-tonne dump trucks in India, utilizing technology from Hitachi Canada. These trucks are primarily used in the mining industry. The company also plans to introduce more models in India to support the ‘Atmanirbhar’ policy. Singh emphasized that localisation is crucial for cost control and is an ongoing process for the company.
Plant Details and Future Plans
The Kharagpur plant is the largest excavator plant in Southeast Asia, with an investment of Rs 1,100 crore. Including the Dharwad plant, Tata Hitachi’s total cumulative capital expenditure will reach Rs 2,000 crore. The company is optimistic about the upcoming Union budget and expects it to boost infrastructure development, which will drive demand for equipment in the second half of the year.
Market and Revenue
Despite challenges from Chinese imports, Tata Hitachi aims for 8% revenue growth. In FY’24, the company achieved a revenue of around Rs 5,000 crore, with both plants operating at 75-80% capacity. The market size of excavators is approximately 1.25 lakh units, and Tata Hitachi holds a 24% market share. Singh mentioned that the first half of the fiscal year was slow due to elections and monsoon, but he expects growth to pick up in the second half.
Tata Hitachi’s significant investment in its manufacturing plants reflects its commitment to quality, innovation, and localisation. By increasing localisation levels and leveraging advanced technology, the company aims to strengthen its position in the market and contribute to India’s self-reliance goals.
