Andhra Pradesh-based Amara Raja Batteries on Friday said that it is scouting for locations to set up a new manufacturing unit in the Northern part of the country which is likely to be operational by 2012.
"The capacity utilisation of the existing facility is about 80% and in the next 12-18 months, we will be running at full capacity. So in the mid-term, which is around 24 months, we will need a new facility," Amara Raja Batteries Head (Strategic Business Unit, Industrial Batteries) Vijayanand S said.
The company currently has a manufacturing facility at Tirupati that can produce up to three lakh units every month.
"If we go for a facility with similar size, we may need 30-40 acres of land ... We want to be present in North India," he said, adding the company is exploring options in Rajasthan, Uttarakhand and Haryana for the proposed unit.
He, however, declined to share any possible investment figure saying it is too early to announce.
The Tirupati facility is an integrated facility that houses six plants catering to various segments such as four-wheelers, two-wheelers and industrial batteries.
The company's production is divided into two segments - automotive and industrial batteries. The two areas contribute equally to the Rs 1,465-crore firm.
Of the industrial batteries, contribution from the telecom sector stands at 45-50%, while the sales from UPS batteries is 35-40%. The rest comes from other sectors like railways, oil and gas and the solar energy. It today launched a new range for the telecom sector.
The firm enjoys about 25% share in the Rs 3,500 crore Indian industrial battery market, Vijayanand claimed.
Amara Raja Batteries had in November announced to invest nearly Rs 130 crore by September 2011 to hike production capacity in a phased manner and on other capital expenditures.
For the ongoing fiscal, the firm would invest Rs 22 crore on increasing four-wheeler battery production to 5.05 million units per annum from the present 4.2 million.
It would invest another Rs 35 crore to hike two-wheeler battery production to 3.6 million units per annum from the current 1.8 million units, which would be completed by March 2011.
The company had earmarked Rs 23 crore to be utilised on on IT and other capex this fiscal.
In the second phase of expansion, to be completed by August-September 2011, the firm would invest Rs 47 crore to take the four-wheeler battery production capacity to six million units annually and that of two-wheeler to five million units.