Dunlop to invest Rs 500 cr on tyres

Kolkata: Dunlop India Limited (DIL), the tyre company of the Kolkata-based Pawan Kumar Ruia Group, would invest around Rs 500 crore to scale up production of off-the-road (OTR) tyres at its Sahagunj (West Bengal) facility to 200 ton per day (tpd) by the end of 2010.

'At present, we are manufacturing 15-20 OTRs at our Sahagunj facility and we propose to take that upto 100 ton per day in one and a half year and subsequently to 200 ton per day by the end of 2010 keeping in mind the growing demand for such tyres. Dunlop will invest Rs 500 crore to enhance production of OTR tyres', Pawan Ruia, the chairman of the Ruia Group, said.

DIL was upbeat on having manufactured the largest off-the-road (OTR) tyre in its history weighing one ton and costing Rs 2.65 lakh.

DIL had already received trial orders from Hindustan Copper Ltd (HCL) and Bharat Earth Movers limited (BEML) for these tyres.

DIL was hopeful of securing a trial order from Coal India as well.

Dunlop's combined capacity of its two facilities at Sahagunj and Ambattur (West Bengal) was now at 130 ton per day but the company produced 50 ton per day at Sahagunj and about 40 ton per day at Ambattur.

Ruia said group company Jessop Ltd would not shift its proposed shipyard project outside West Bengal.

Land acquisition for the proposed shipyard project was difficult at this stage but it was hopeful of getting land.

DIL would scale up capacity at Sahagunj and Ambattur plants to 100 ton per day each in the first phase from current combined capacity of 130tpd.

Sahagunj and Ambattur were producing at 50tpd and 35tpd respectively now.

Production would rise to 155tpd soon thanks to debottlenecking at both sites.

DIL was exporting small tyres to Nepal, Bangladesh, Bolivia, Philippines, and was in talks with Tata Motors for testing of truck tyres. DIL would be free to trade its shares after the division bench of the Orissa High Court at Cuttack lifted the stay on the rights issue, demat and trading of the company's shares imposed by the Appellate Authority for Industrial & Financial Reconstruction (AAIFR).

The company stepped out of the the purview of the Board for Industrial & Financial Reconstruction (BIFR) after a Madras High Court ruling in December last year.

It was under BIFR since 1998.