Tata Hitachi plans to invest Rs 250 crore in West Bengal and Karnataka

Infrastructure and mining equipment maker Tata Hitachi has lined up Rs 250 crore investment over the next two years in West Bengal and Karnataka despite cost and margin pressure it is facing now, a top official said Wednesday. 

"We will invest Rs 250 crore in plants of Kharagpur in West Bengal and Dharwad in Karnataka over the next two years," Tata Hitachi managing director Sandeep Singh said Wednesday. He, however, did not elaborate on investment break-up between the two plants. 

Tata Hitachi has closed down Jamshedpur plant and its capacity has been transferred to Kharagpur site with enough provisions for expansion, he said. Tata Hitachi is the leading investor at Vidyasagar Industrial Park, Khargpur. 

Singh said this year the company was facing higher cost and margin pressure due to rise in input cost and rupee depreciation. Tata Hitachi is a joint venture between Tata Motors and Japanese outfit Hitachi Construction Machinery Co with 40:60 per cent shareholding. 

To remain the market leader in the competitive excavator's segment, the company has decided to foray into the sale of refurbished products but would restrict it to its own brand. 

"This business is not high margin but to sustain our business we felt it is necessary. Second-hand equipment transactions are high as the price is 40-50 per cent lower than new equipment," Singh said. 

He said Tata Hitachi is expanding its products portfolio and exploring localising of high tonnage excavators which are currently imported.

(With inputs from agencies.)