Chinese global battery brand aims for India through Lanka factory
Wednesday, 1 October 2014 02:26
China’s largest sealed acid battery exporter which is also one of the world’s top ten battery brands said that it wants to expand its Lankan operations – and is aiming for a bigger share of the $ 3.2 billion Indian battery market.
“Our Phase I investment in Sri Lanka is $ 9 million and at the point of entry to Sri Lanka, we have intimated there will be a second phase. The bulk of our containers go to India, followed by Pakistan,” said a keen Sam Teo (Manager HR & and second in command of Bata-Ata Leoch Lanka operations) on 26 September at southern Bata-Ata Industrial Zone.
Teo was making an in-depth presentation about Leoch Sri Lanka to Minister of Industry and Commerce of Sri Lanka Rishad Bathiudeen on 26 September when Minister Bathiudeen visited the southern Bata-Ata Industrial Zone for a site-inspection. Bata-Ata Industrial Zone is the largest industrial zone in the south.
“Our Leoch Inter-national Technology Limited (LITL) is currently one of world’s top five manufacturers of sealed lead-acid, automotive, motorcycle and UPS batteries and it is China’s largest exporter of UPS batteries. Diversified manufacturer Leoch’s sales network covers more than 100 countries and regions. LEOCH Lanka, whose operations are in the southern Bata-Ata Industrial Zone (BAIZ) is Sri Lanka’s largest exporter of such batteries,” said Teo and added: “Strategic location of Sri Lanka being close to South Asian markets such as India, Pakistan and Bangladesh is the main reason we chose to enter here. At this moment, the main markets for our Sri Lanka made products are India, Pakistan, and Bangladesh and we are currently exploring the Middle East as well-in that, the bulk of our containers go to India, followed by Pakistan. The full capacity in four acre large Bata-Ata’s Phase I operation is 35 containers per month. “Currently we are at 20 containers per month and around 500 jobs capacity, contributing a minimum of $ 15 million per year to Sri Lanka’s forex revenues. Also, if our current proposal to Schneider Electric India is accepted by them, then we will be adding another 10 containers per month for Indian market and also bringing our current export capacity to 30 containers a month.
“Our Phase I investment is $ 9 million and at the point of entry to Sri Lanka, we have intimated that in second phase, we will expand with another $ 20 million investment. In that, if approval is granted, in the next three years starting 2015/16 we are looking to invest this $ 20 million. This new round of investment will increase our capacity to 100 containers per month generating 1,200 additional jobs and $ 72 million total annual export revenue to Sri Lanka from Leoch!”
“I am pleased of Leoch’s success story in Sri Lanka,” said Minister Bathiudeen, and added: “I am also pleased that Leoch chose an industry zone under the Industry and Commerce Ministry to reach the surging South Asian markets. The Indo-Sri Lanka Free Trade Agreement (ISFTA) helps exporters like you to export more than 4,000 products duty free to India while Pakistan Sri Lanka Free Trade Agreement (PSFTA) helps you to send another 4,000 product lines to the Pakistani market. Leoch Lanka is a great example of a global investor making use of these two FTAs to their advantage. I and my officials will give our fulles cooperation in your second round of industrial investment in Sri Lanka.”
The Indian lead acid battery market is estimated to be more than $ 3.2 billion. It has been growing due to the rise of automotives, uninterrupted power supply systems (telecom, hospitals and computers/UPSes), and increased use of refurbished old vehicles. Two firms, ‘Exide Industries’ and ‘Amara Raja Batteries’ reportedly hold 90% of market share in passenger vehicle batteries.
On 26 September, Minister Bathiudeen also toured and inspected Leoch Lanka’s battery manufacturing production lines at Bata-Ata Industrial Zone.