Date:29/09/2004 URL: http://www.thehindubusinessline.com/2004/09/29/stories/2004092901140200.htm

Back Axles India to put up Rs 16-cr plant for Dana Corp supplies

Our Bureau

Chennai , Sept. 28

AXLES India Ltd is putting up a Rs 16-crore plant that will supply axle housings to Dana Corporation of the US.

Dana Corporation, the TVS group's partner in Axles India, has agreed to buy 50,000 axle housings a year from the company.

Work on the project at Sriperumbudur, near Chennai, has just started and is expected to be completed by October, 2005, Axles India's Chairman & Managing Director, Mr S. Ram, said on Tuesday. Speaking to journalists on the sidelines of the company's annual general meeting (AGM), Mr Ram said that the value of the annual order would work out to Rs 40 crore.

At the AGM, shareholders approved a resolution raising the borrowing powers of the board of directors to Rs 32 crore. Mr Ram said that the resolution was to enable the board to secure term loans from its bank, the Indian Overseas Bank. He told shareholders that the company had turned the corner last year and a Rs 3.59-crore post-tax profit helped it wipe off the accumulated losses of Rs 3.45 crore and add a sum of Rs 14 lakh to the net worth.

"With larger purchases of commercial vehicles in the last two years, the demand in the current year is expected to be moderate," the company's annual report for 2003-04, cautions.

However, Mr Ram said that the company had performed well in the first half of the current year.