Sundram Fasteners, a TVS Group company, plans to spend Rs 100 crore this year on expanding capacities and developing new products. This capital expenditure will be subject to market conditions and internal accruals, according to the company.
In the last financial year, the company pruned its capital expenditure from the budgeted Rs 150 crore to Rs 97.45 crore due to lower demand projections from customers.
NEW PRODUCTs
According Sundram Fasteners’ 2012-13 annual report, the company proposes to add capacities on some of its product lines based on long-term contracts with its existing customers. It also proposes to add secondary capacities to develop new products for its customers.
The overall slowdown in the automotive industry in India and Europe affected Sundram Fasteners’ and its subsidiaries in 2012-13. It reported net sales of about Rs 2,070 crore against Rs 2,146 crore in the previous year. Exports, which increased by five per cent to Rs 678 crore, accounted for about 34 per cent of the overall sales revenue.
According to the annual report, the German subsidiaries continued to be affected by the European financial crisis and by the decline in the automotive and other industries.
The sales of the Chinese subsidiary — Sundram Fasteners (Zhejiang) Ltd, which makes high tensile fasteners and bearing housings, increased to Rs 97 crore in 2012 from Rs 86 crore the previous year, while net profit grew to Rs 4.20 crore from Rs 3.41 crore.
Sundram Fasteners’ German operations saw revenues drop to Rs 376 crore in 2012 from Rs 439 crore the previous year, with a loss of Rs 31 crore against a loss of Rs 29 crore in the previous year. Uncertain economic conditions prevailing in Europe continued to impact German operations. Sales and other income of Cramlington Precision Forge Ltd, the UK subsidiary, increased to Rs 75 crore from Rs 70 crore, while its net profit was down to Rs 5 crore from Rs 7 crore in the previous year.
Indian subsidiaries
Sales and other income of Sundram Fasteners’ fully owned subsidiary Upasana Engineering were Rs 78 crore during 2012-13 against Rs 80 crore previously. Net profit was Rs 4.40 crore against Rs 3.93 crore in the previous year.
The sales and other income of Sundram Bleistahl, which makes sintered valve guides at the 100 per cent export oriented unit at Hosur in Tamil Nadu, was down to Rs 20.48 crore from Rs 23.52 crore in 2011-12. It reported a net profit of Rs 34.55 lakh against Rs 1.98 crore previously.