Chennai: As a part of de-risking its business from the automobile sector, Sundram Fasteners has decided to get into aerospace and defence sectors and has earmarked Rs 100 crore for the purpose.
Sundram Fasteners will also be investing about Rs 150 crore for expanding its capacities during the current fiscal.
In a statement issued here, the company said it is focusing on the non-auto segment as aerospace and defence sectors and has incorporated a wholly owned subsidiary TVS Engineering Ltd.
The company has earmarked Rs 100 crores of its capacities for defence opportunities.
TVS Engineering Limited would manufacture wide spectrum of forged, machined parts, missile parts, precision machined parts, titanium and stainless steel fasteners, torsion bars, transmission parts and engine parts like con rods, crank shafts engine liners pumps and critical fasteners.
As regards its capex for FY21, Sundram Fasteners said it proposes to spend about Rs 150 crore towards capacity expansion, and a sum of Rs 63 crore has already spent during the first half of the year.
TVS Upasana Ltd, a wholly-owned subsidiary of Sundram Fasteners, has commenced a new division at its plant located at Vallam Vadagal, Sriperumbudur in Kancheepuram district with an investment of Rs 17 crore proposed to be spent over a period of next 3 years.
The new division has been set up to manufacture radiator cap covers, radiator cap housing, radiator cap lids and filter element parts.
Meanwhile, Sundram Fasteners closed the second quarter of the current fiscal with a net profit of Rs 97.36 crore up from Rs 71.07 crore posted during corresponding period the previous year.
The revenue from operations was at Rs 766.85 crore for the Quarter ended September 30, as against Rs 766.82 crore during the same period in the previous year.
With the gradual opening up of the economy post lockdown, there has been an upward trend in the original equipment manufacturers (OEM) production levels.
The domestic sales for the quarter ended September 30 were at Rs 483.88 crore as against Rs 450.01 crore during the previous year showing clear signs of improvement in the domestic demand.
The export sales for the quarter were at Rs 260.28 crore as against Rs 290.88 crore last year. The export market has been slower to pick up.
After the impact of coronavirus pandemic, the activities of the plant of Sundram Fasteners (Zhejiang) Ltd, China, the step-down overseas subsidiary have returned to normal levels, the company said.