Kinetic Engineering, the erstwhile maker of the Luna mopeds and the Kinetic scooter, is exploring partnerships to get into battery and electric motor manufacturing in India amid the government’s push for developing green mobility solutions in the country.
Kinetic Engineering is in talks with Japanese and Korean companies to explore partnerships for the motors and it has already been approached by a vehicle maker to manufacture battery, its managing director said.
The government’s push towards electrification and make in India offers a great opportunity for the company to expand the business, Ajinkya Firodia told ET.
“Our aim is to offer a complete end-to-end solution for electric two-wheelers, three-wheelers and small commercial vehicles and eventually buses. We aim to offer a complete bouquet of solutions from axles, gearbox, controller, motors to batteries. We think the push towards electric vehicle segment could potentially double the business for us,” Firodia said.
Initially, it will offer a kit with 1.2 kW capacity motor and then build higher capacity kits of up to 11kW, which can be used for goods-carrying small commercial vehicles. In all, it is planning seven to eight different product lines.
To begin with, the company is targeting the mushrooming low-speed e-auto business and to offer parts for electric two-wheelers, before expanding to small commercial vehicles and buses over a period of 3-5 years. The partnerships it is looking for are for higher-capacity motors.
To be sure, the government has approved Rs 10,000 crore benefits under its programme to support electrification of vehicles. The subsidy scheme intensifies the focus on public transport and last-mile connectivity, precisely the areas Kinetic Engineering wants to target.
This diversification will happen at an extremely low cost of Rs 30 crore and the manufacturing of these parts will happen out of the existing facilities, which will add to the bottom line.
After exiting the two-wheeler business, Kinetic Engineering has turned around operations with 20-25% compounded annual growth rate and also repaid Rs 400 crore of debt to become debt free.
The kits that it would offer could be used not only to make new electric vehicles but also be retrofitted on existing three-wheelers and small commercial vehicles with electric power trains.
For higher capacity motors, Kinetic is seeking partnerships. “For the electric motor we are looking for possible collaborations or joint venture partners. We will talk to Japanese and Korean players as we go higher in technology requirement,” said Firodia.
Calling it a Rs 200-crore opportunity, Firodia said this push towards electrification could potentially double the company’s revenue in the coming four to five years. The compared incurred a loss of Rs 8 crore on revenue of Rs 116 crore in fiscal 2019.
Source: Economic Times