Tyre major CEAT on Wednesday announced plan to set up a Rs 250-crore manufacturing plant in Bangladesh. The initial capacity would be 65 tonnes per day and production is to commence in FY-13. Of the total production capacity, 80 per cent will be of truck and light-truck tyres and the rest of two- and three-wheelers and last-mile vehicles, said Mr. Anant Goenka, Deputy Managing Director, CEAT.
“Over the next three years, we will be looking at increasing our market share in Bangladesh up to about 40 per cent. We have a strong presence in Sri Lanka as the only tyre manufacturer. We hope to replicate the same in Bangladesh,” he said. Present in Sri Lanka for the past 15 years as the sole tyre manufacturer, CEAT 50 per cent of the Lankan market. Approximately, 80 per cent of the raw material for the Bangladesh plant will be imported from India and South-East Asia. The Rs 250-crore investment will be raised through a mix of equity and at least 60 per cent debt, said Mr Goenka.
“We will be competing mainly with imports and, therefore, have a cost advantage. There is good demand for Indian-manufactured tyres out there,” said Mr Goenka.
The company posted a 52.3 per cent decline in its third quarter net profit numbers. The December quarter net profit of the company stood at Rs. 2.39 crore, down from Rs. 5 crore in the corresponding quarter last year.