NK Minda group forays into Automotive Batteries with Fiamm

New Delhi 24th of July 2006

Minda Industries Limited (MIL) announces its foray into Automotive Batteries in collaboration with FIAMM S.p.A, Italy

To invest Rs.40 Crore in setting up Battery Unit at Pantnagar, Uttranchal

Minda Industries Limited (MIL), the flagship company of Rs.545 crore NK Minda Group today announced its plans to set up a new plant at Pantnagar, Uttranchal to manufacture automotive batteries. The Battery project targets automotive batteries for 2, 3 & 4 wheeler vehicles. The Battery project has technical collaboration with Europe's leading automotive supplier FIAMM S.p.A of Italy.

The company is investing Rs.40 crores in setting up the battery plant at Pantnagar. The total capacity of the plant, when fully operational, would be 4 million batteries per annum. The plant is likely to be completed by December year and would commence production in the last quarter of the Financial Year 2006-07.

"We are looking at cornering a substantial part of the Batteries market in India and hope that like all other products of our portfolio, our batteries will also be well received by the OEMs. This Battery project is very close to our heart and is a major milestone in our diversification process", says Mr. Nirmal K Minda, Managing Director, of Minda Industries Limited said.

Commenting on the tie up with FIAMM, Mr. Minda said, "Minda shares a very strong relationship with FIAMM, which is a leading automotive supplier in Europe known for its quality products through emphasis on technology. Collaboration for the battery project also shows the confidence that FIAMM places in the NK Minda group in terms of absorption of technology and delivering of products of global standards".

Minda will manufacture and market the Valve Regulated Lead Acid Battery (VRLA), a first for India, which is a sealed and leak-proof battery and completely maintenance free. In the 2.5 Ah segment, targeted at kick-start vehicles upto 150 cc, Minda will manufacture both the Conventional and maintenance free batteries and. In all other segments like 5 Ah to 50 Ah batteries for 2, 3 & 4 wheelers, Minda will manufacture Maintenance Free and VRLA batteries. The emphasis is to create batteries that are more attuned to Indian conditions. All conventional flooded batteries, conventional low maintenance free batteries and VRLA batteries will be manufactured under one roof at the Pantnagar facility.

MIL expects to clock revenues of Rs.50 crores in the first full year of operation from the batteries i.e.2007-08 and the projected revenues in the third year is Rs.125 crores. The company will be manufacturing batteries for the 2 Wheeler and 4 Wheeler segments. The range of batteries would be from 2.5 Ah to 50 Ah and would incorporate the latest technological advances in this field.

The collaboration is in the nature of a technical tie up where FIAMM would supply the technology for the product. The agreement also gives MIL the exclusive rights over FIAMM automotive batteries in India for sale as well as manufacture for the next 10 years. MIL also gets the exclusive rights to market and export 2W/3W batteries around the world.

MIL has earmarked Rs 200 - 250 crores for expansion plans including setting up new plants, diversifying into new product categories, Mergers & Acquisitions and expansion of current capacities. Mr. Minda stated that this is just a beginning for the number of new initiatives being undertaken at the group to enhance shareholder value by seeking to diversify into new growth categories.

The battery market in India is divided into two categories the OEM and Aftermarket. The OEM Market is estimated to be Rs. 348 crores while the Aftermarket is estimated to be Rs.1825 crores in the year 2007-08.

Minda Industries Limited (MIL) designs, develops and manufactures switches for 2/3 wheelers and off-road vehicles. It also manufactures lamps for automobiles (2/3 & 4 wheelers). MIL is a Rs. 3040 million (over US $ 66 million) company and is on a rapid expansion spree. It is geared to take on global competition and has already made inroads into the ASEAN market. It is on its way to becoming the favoured vendor for 2/3 wheeler switches globally.

Minda Industries has its manufacturing plants in Gurgaon, Pune, Hosur, Delhi & Aurangabad and has over 1200 employees. Minda Group also has a manufacturing facility in Indonesia, looking after the booming ASEAN market.

About NK Minda Group

NK Minda Group is India's foremost manufacturer of a range of automotive components. The Group has an annual turnover of US $ 121 million (over Rs.545 Crore) and is a leading supplier to Original Equipment Manufacturers.

The NK Minda Group product profile comprises of Switches for 2 / 3 wheelers, switches for 4 wheelers, Lighting, Horns and Alternate Fuel kits. Minda Group has joined hands with global leaders to constantly fine-tune its offerings and has some of the most reputed automotive component manufacturers as its joint-venture partners. These include Tokai Rika Co. Ltd., Japan and Fiamm S.p.A, Italy.

For more information, please contact:

Dr. Abha Azad / Milton Singh, Finesse PR

91 11 27022460 / 27013586 / 27018630, abhaazad@finessepr.com / milton@finessepr.com