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Home arrow News arrow Business News arrow AMS targets Rs 1000cr in next 5 years, investing Rs 50cr to double capacity
AMS targets Rs 1000cr in next 5 years, investing Rs 50cr to double capacity Print E-mail
Written by Arjun   
Thursday, 05 May 2011
Bangalore: Ace Manufacturing Systems Ltd. (AMS), one of India's largest manufacturers of machining centers with it's production facility at Peenya plans to double it's capacity from 1500 machines per annum to 3000 machines per annum in the next two years. The company will invest Rs. 30 Crores on infrastructure and Rs. 20 Crores on machines. The expansion will be funded by the company's internal accruals & Bank loans.

This year, AMS hopes to fully utilize it's existing capacity of 1400 machines per year and register a turnover of Rs. 330 to 340 Crores.

The company's current manufacturing facility has an area of 200,000 sq. ft. New infrastructure, will be created at it's existing premises where it already has 4 acres of land available. The new facility is expected to be commissioned by next year.

"Currently we serve the auto sector (mainly the two-wheeler & the four-wheeler), general engineering sector, Die & Mould sector and aerospace sector. In the future we will plan to add, energy sector, auto components for heavy vehicles, medical sector and increase market shares in Die & Mould sector and aerospace sector," said Mr. P. Ramadas, Managing Director of AMS.

Rs 1000 Cr. turnover in next 5 to 6 years

In the next 5 to 6 years AMS is targeting a turnover of more than Rs. 1000 Crores.

In 2010-11 the company registered a turnover of Rs. 212 Crores and dispatched 752 machines. This was 92 percent higher than the previous year where the company registered a turnover of Rs. 110 Crores and dispatched 454 machines.

The average value of the machines has gone up due to increase in sales of higher technology and larger machines. This year the company plans to achieve a growth of more than 100 percent in the sales of these higher end machines.

2011 -12 is going to be a big year for exports

The company aims to export around 75 to 100 machines this year – which is a growth of more than 200 % over last year.

The company's top 10 customers include Endurance group, Sundaram Clayton Group, Brakes India Group, Bajaj Auto Ltd., Greaves Cotton Ltd., Autotech Industries, Bosch Group, Kiran Udyog Ltd., Bagla Group, Sakthi Auto Components, JKM Daerim, Polyhydron Pvt. Ltd..

Expansion to reduce cycle time

"Once the additional capacity is created, we will separate the fast moving machines and the special machines which are provided in a tooled up configuration. The first floor will be used for base building and sub-assemblies while the ground floor will be used for final assembly," Mr. Ramadas said.

There will be about 30 percent increase in manpower this year to attain the targeted growth.

"In this phase of expansion, focus will be on automation and increasing productivity per employee, therefore the increase in manpower will not be ratio metrical. With this the cycle time recurred to produce a machine is expected to come down by about 20 to 30 percent," he added.

R&D

AMS recently launched many new products at IMTEX 2011 and have received an overwhelming response from customers for these products. The company aims at continuously improving the performance of its existing products while keeping the costs low. AMS is also investing in developing it's in-house R&D capability by setting up additional labs, centre of excellence for computer aided manufacturing.

"Currently around 25 to 30 people are involved in new product development and R&D. Additional facilities are being created to test the machines thoroughly and to enable better performance before dispatch," said Vishwas P. R., Officer on Special Duty (OSD), AMS.

AMS now takes an average time of 6 to 8 months in new machine development - from concept to production.

Vendor development

AMS plans to invest Rs. 20 to 25 Crores to acquire around 100 acres of land in order to set up a vendor park. “We are encouraging our suppliers also to expand" said Mr. L.S. Umesh, Chief Executive Officer of AMS.

The company has orders for Rs. 130 Cr of machines as of April 2011. "Had we received adequate parts on time we would have been able to deliver 200 more machines last year."

"About 60 percent of our parts are localized. Parts such as CNC systems, motors & drives, Ball screws, LM Rails, Bearings, Couplings, etc., are the major contributors to the imports. We are working on increasing the localization of the parts that go into the machines. It is a continuous process and we are encouraging the development of indigenous manufacturing of such items. However, in the process of localization of parts we would never compromise on the quality of the machines that we develop, we would import it instead. We would also not venture out of our core competence in the process of backward integration." he added.

The company is also looking at partnering with foundry companies in order to ensure a reliable supply of castings. It currently utilizes around 6000 tpa in castings. "Casting is our biggest issue. We are looking at creating a dedicated facility through such a partnership," he said.

Contract manufacturing

AMS is also engaged in contract manufacturing of machines for companies from Japan.

"We did contract manufacturing for a Japanese company between the years 2002 to 2006 which was stopped due to renewed regulations from the Japanese govt. The contract manufacturing we did for Japan allowed us to learn about their machine building process. We have been able to refine some of the finer aspects of manufacturing and reinforce our principles of machine tools building & testing," said Mr. Umesh.

Last Updated ( Wednesday, 25 May 2011 )
 
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