Date:27/07/2004 URL: http://www.thehindubusinessline.com/2004/07/27/stories/2004072701950200.htm

Back SAR Silicon ties up with US co to make auto batteries

Neha Kaushik

New Delhi , July 26

SAR Silicon Systems has entered into a technical tie-up with the $685-million EaglePicher, a US-based manufacturer of battery systems, to manufacture automotive and valve regulated lead acid batteries in India.

SAR, which also manufactures luminous inverters, is setting up a production facility in Himachal Pradesh for the same at an investment of Rs 30 crore.

According to Mr Rakesh Malhotra, Managing Director, SAR Silicon Systems, the first phase of the plant will be completed by January 2005, while the entire plant will be completed by August 2005.

"At the completion of the first phase, capacity at the plant would be at half-a-million unit per annum. This would be increased to one million units by August 2005," he said.

The range of batteries will be marketed under the co-brand Luminous EaglePicher.

The company is currently focusing on the replacement market for automobile batteries, which is a segment as large as 3.5 to four million units a year.

"We already have a very strong distribution network in place of about 4,600 dealers, so this was a very natural extension for us. There is a large domestic market for batteries. We are expecting high growth from the motorcycle batteries segment, as after the explosive growth in motorcycles, the replacement battery market should now receive a fillip. We are expecting the battery business to generate a turnover of about Rs 500 crore in the next three-four years," Mr Malhotra said.

With technological support from EaglePicher, SAR claims to produce batteries that will technologically outlast the current ones by about 35 per cent.