Tuesday, October 11, 2011
By Pranjal Gera
Atul Auto may enter four-wheeler division by investing INR 200 crore
Atul Auto, a well-known name in commercial three-wheeler segment, seems all set to enter the much competitive four-wheeler market with an initial investment of INR 200 Crore. The announcement was made by the company after annoyed by the postponement in the divestment of the Gujrat state-run ailing company Scooters India Limited.
Upset with the turtle-walk proceedings from the state government side, from approaching month onwards the company will be looking for other alternatives which includes the entrance in the four wheeler segment. And the firm is positive of investing an amount of INR 200 Crore, as said by Mr. Vijay Kedia- Director at Atul Auto.
The Rajkot based Bombay Stock Exchange listed company was interested in gaining a major stake in Scooters India Limited (SIL); a sick public sector company. The government of Gujrat was considering a divestment on the same.
SIL produces three-wheelers and in May this year the government had declared to divest its overall share of 95.38 percent in the ailing company. Since the financial year 2003, SIL has not seen any prosperity.
According to Mr. Kedia, till now Atul Auto was interested in acquiring SIL, reasons being both the houses make similar vehicles, such as three wheelers with front engine. But looking at the sluggish development the firm is eyeing some other alternatives.
He added that at least 16 to 18 months will be required to establish the manufacturing unit; the firm is slowly but steadily advancing on this project. Also, the company is in search of an associate whose technology will assist them to debut in this division of automobile.