PSL Ltd. - Manufacturing Base In USA

PSL Plans Pipeline JV In US

Leading pipe manufacturer PSL Holdings (PSL) is planning to have a manufacturing base in the US. The company is in talks with a US company to set up an equal joint venture for manufacturing high grade pipes, which finds application in the field of oil and gas.

“We are in final talks for a manufacturing joint venture in the US, which is a high potential market. In the immediate future, it makes sense to ship pipes to the US. However, in the long run, one has to have a manufacturing presence there to penetrate the North American market,” said Ashok Punj, managing director, PSL Holdings.

The name of the partner and investment involved was not disclosed. However, according to industry sources, if talks materialise, the joint venture will have to spend more than Rs 500 crore for setting up the facility. Of the $52 billion global market for oil & gas (O&G) pipeline projects, North American firms corner projects worth $15 billion. PSL is currently participating in various onshore pipeline tenders in the US.

Welspun Gujarat Stahl Rohren (Welspun), Man Industries, and Jindal Saw are some of the local competitors of PSL. Jindal Saw is the only company having a manufacturing base in the US. Welspun and Jindal Saw recently secured pipeline contracts in the US. Welspun, which got a Rs 450 crore contract this month from a US-based oil & gas major, will be shipping the entire LSAW and spiral pipes to US from India.

Welspun, however, is not very sure about manufacturing in the US. “We ship pipelines from our base in India to all our project destinations in the world including the US. Manufacturing in the US is a high-cost affair. What if the US is not that lucrative market in the long run? What if the oil prices come down to $40 levels from the existing $65 per barrel? One has to take into account these factors before making a decision (to manufacture in US),” said a senior Welspun official.

A senior official in Man Industries, differs and said, “Taking into account the logistics-related inconveniences, it makes sense in today’s conditions to manufacture in the US.”

GHCL - Going London

GHCL Plans Listing On London AIM Exchange

The Rs 533 crore home textile and soda ash manufacturer Gujarat Heavy Chemicals Ltd (GHCL) plans to list on London’s AIM stock exchange by the middle of next year and will begin restructuring its current operations to adopt a more pure play structure. This will help the company meet some of the admission criteria of AIM as the company, at present, operates both its soda ash and textile businesses under a single umbrella. The company’s returns from the textiles and soda ash business are approximately in the ratio of 1:4.

“We are currently evaluating various structures for our operations and will go ahead with the one that makes the most business sense. The final plans on the restructuring will be laid out by the end of the year and the execution should begin after that,” said Nikhil Sen, head (strategy and international business), GHCL.

“We have been advised by the global investment community that a pure play structure, clearly separating the textile and soda ash businesses, would make more business sense and enhance shareholder value, so the company is evaluating its options,” he added but refused to divulge details on the size of the proposed float.

GHCL has seven subsidiaries, of which three are in the Netherlands, two in the US, one in Romania and one in India. It has interests in soda ash, salt, textiles, ITeS and energy. It acquired American brand Dan River in January this year for $17.5 million and followed it up by acquiring the UK’s largest home textile retail chain Rosebys in June. AIM is the London Stock Exchange’s face for smaller growing companies and over 2,400 companies have joined it since inception in 1995, raising more than £30 billion both through IPOs and further capital raising.

SREI Infra - Sand To Silicon

SREI, US Unit Plan Silicon Unit

Srei Infrastructure Ltd (SIL), the Kolkata based infrastructure finance company could join hands with one of the leading US based silicon wafer manufacturers, for setting up a solar grade silicon manufacturing unit in West Bengal. A state government official said that representatives of the US outfit along with top officials of Srei today met state chief minister Buddhadeb Bhattacharjee with the proposal.

"If materialise then the unit will be first of its kind in India which will make silicon wafer. The chief minister is keen to see that the project materialises considering its importance This will be the first company to manufacture solar grade silicon and wafer. So far Indian companies are importing wafers from United States and Germany," said sources.

An official of West Bengal Renewable Energy Development Agency (Webreda), said that the project is unique because Indian companies are so far importing wafers. Wafer is used in solar cell and other strategic defence materials. According to the official, the US outfit is keen to set up an integrated plant which could manufacture wafer from sand. "It will first make silicon from sand. Then the silicon will be purified up to 99 per cent and will be converted to ingot. The ingots will then be sliced into wafers," he said. According to sources in the state government, Srei and the US outfit would soon give a formal proposal to the government for the project.

Genus Overseas - Going Global

Genus Overseas, Brazil Firm Form JV

Rajasthan-based Genus Overseas Electronics Ltd, one of the largest producers of multifunctional electronic energy meters, has decided to enter into a joint venture with Mobix, a Brazilian company, which is one of the leaders in communication technology. The transaction involves an investment of $15 million. Of this, $9 million will be raised through loans from development banks in Brazil and the rest will be raised through equity from both the companies.

The electronic meters are being manufactured using state-of-the-art Automatic Meter Reader (AMR) technology. Genus Overseas products have found wide acceptance in Latin America. The company is already doing pilot projects in Brazil for the past two years and have got all necessary approvals there. “With this joint venture with Mobix, it has entered the world market because there is huge demand for electronic meters in Latin America, Africa, etc,” said Genus Overseas Electronics Ltd Director Kailash Agarwal.

Genus Overseas Electronics Ltd is one of the market leaders in the design and manufacture of high-end multi-functional intelligent single phase and three-phase meters with in-built advanced security and anti-tamper features, AMR-enabled meters, Trivector meters, Time of the day (TOD) meters, Audit meters, Hybrid Microcircuits (HMCs), and Resistor Networks. These activities of Genus form part of Energy Management Systems (EMS). To intensify the efforts in EMS, over the preceding few years, Genus has taken one more step by venturing into projects in power distribution sector.

Genus is an ISO 9001:2000 certified company. It has IECQ, CE and EMI/EMC certifications for all key components and products.

Punj Lloyd - Foraying Into Aviation Sector

Punj Lloyd Inks 49:51 JV With Swissport

Punj Lloyd has entered into a 49:51 joint venture agreement with Swissport International, a world leader in the ground handling industry. According to a release issued by Punj to the BSE today, the JV will leverage Swissport's brand and know-how to develop projects in the Indian ground handling sector.

Atul Punj, chairman of Punj Lloyd, said: "The joint venture will enable Punj Lloyd to enter into a new business field in the aviation sector in India, which has robust growth opportunities. We are enthusiastically looking forward to developing our partnership with Swissport into a very successful business."

Patel Engineering - Water Engineering To Infrastructre

Patel Engg Buys Michigan Engg

Patel Engineering today announced acquisition of Michigan Engineers Pvt Ltd (MEPL), a city-based urban infrastructure company for an undisclosed sum. "The government is planning to spend Rs 63,000 crore over the next five years on urban infrastructure. The acquisition of MEPL provides the perfect platform to leverage joint skills and bid for urban infrastructure and sewerage projects", said Rupen Patel, managing director.

With the acquisition of MEPL, Patel Engineering will now be able to provide end-to-end solutions in sewer rehabilitation and urban infrastructure space, he pointed out. Patel Engineering will now focus on the explosive growth in urban infrastructure both in metros and tier II cities. Michigan Engineers, a 28-year old company, had annual revenues of about Rs 40 crore.

Emami - Big Pie Of Hair Dye Mart

Emami Eyes 20% Of Oil Hair Dye Mart

Indian FMCG major Emami group, along with Activor Corp of the USA, is targeting 10 to 20 per cent market share in the domestic oil-based hair dye segment in the next two years. The domestic hair dye market is, at present, worth Rs 100 crore. “We have just launched specialised hair dye oils for men and women in West Bengal. Our next stop would be Assam. We would also take our hair dye oils to Andhra Pradesh, Uttar Pradesh and Bihar in a month or so. We are also looking at Nepal, Bangladesh and Sri Lanka,” informed Priti A Sureka, director, Emami group of companies. “We forayed into hair dye because we feel there is a lot of scope for product differentiation in this segment. We would come up with more products, like hair colours, etc, in a couple of months from now,” informed Sureka.

“The reason why we launched two variants of hair dye oils for men and women is because we believe that men and women are different and so they would need different hair treatment. For example, compared to a woman’s hair, a man’s hair is three times more exposed to UV rays and five times more exposed to pollution. A woman’s hair, compared to a man’s, is five times more tangle prone. A woman’s scalp too is two times gentler than that of a man. So, while the hair dye oil for men consists of ingredients such as walnut, blackberry and 2X sunscreens, women’s hair dye oil comes with amla, almond and herbal sunscreens,” explained Sureka.The men’s hair dye oil is branded as Mr Black and the women’s Mrs Black.

“We have about 350 distributors in West Bengal alone, through whom we would make our hair dyes locally available,” said Indrani Sen, vice-president, brand communication and planning. “We have just started advertising on television for our hair dye oils. We would advertise on radio in another month or so. Our total advertising budget for the hair dye oil alone in India is approximately Rs 6-7 crore,” said Sureka. Vasmol and Godrej are the competitors that the company will have to contend with. “We are the only company, as of now, offering specialised hair dye oils for men and women. Moreover, we are offering a pre-mixed, non-staining hair dye oil that stays even after a couple of washes,” claimed Sureka.