Regal-Beloit eyes more buys in India, high growth

US-based Regal-Beloit Corp, makers of motion control and power generation products, plans more acquisitions in India...

US-based Regal-Beloit Corp, makers of motion control and power generation products, plans more acquisitions in India and expects revenues to grow 15-20 per cent from its operations there after 2008, a top official said on Monday. Regal-Beloit said on Friday it had acquired Alstom8217;s motor and fans business. Merchant banker Ambit RSM advised the company on the deal.

The purchase makes Regal-Beloit the largest manufacturer of electric motors used in both domestic appliances and industrial units in the country, M K Trisal, president of the Indian unit, said, adding the firm was open to more acquisitions in the country.

8220;We would like to consolidate more. We are at the moment looking at that acquisitions. There is no stopping at that,8221; Trisal said. 8220;We would like to expand in motors, generators, gear boxes, switch gears and electrical control products segments.8221;

The company now makes 4 million fractional horsepower motors used in air-conditioners and refrigerators, and the Alstom unit will add 90,000 units of integrated horsepower motors used in heavy industries and construction sites to the firm8217;s portfolio, he said. In 2005, Regal-Beloit acquired General Electric Co8217;s heating, ventilation and air-conditioning HVAC motors business worldwide.

Regal-Beloit, which will now be competing with big names in the industry like Crompton Greaves, Siemens, ABB, Kirloskar Electric and Bharat Bijlee in India, posted revenues of 78.5 million in 2006 and expects revenues to cross 90 million in 2007. In 2008, revenues will almost double as the Alstom unit will add 80 million in sales to Regal-Beloit8217;s Indian arm.

Indian operations will contribute more than 10 percent of global revenues in 2008, Trisal said. Regal-Beloit global revenues are now at 1.6 billion. 8220;After consolidation, we expect revenues to grow in high teens in 2009,8221; he said.

Trisal said the Indian unit was exploring exports of its entire range of products to Europe and Middle East, broadening sales away from its main US market. This year, the units exports were almost flat at about 60 million as the company was hit by a rising rupee.

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Trisal said the company was planning to set up a new unit in addition to its units in Faridabad, near Delhi, and Alstom8217;s plant in Kolkata. 8220;We are witnessing good growth in India. We would be looking at another location, and west and south India are distinct possibilities,8221; president of the Indian unit said, adding it could also be located within a tax-free special economic zone.