New Delhi: Lumax Auto Technologies, a manufacturer of integrated plastic modules and gear shifters for automobiles, aims to capitalize on new opportunities as premiumization in the passenger vehicle industry drives demand for higher-value components.
To tap emerging opportunities, the auto parts maker recently acquired 75% stake in IAC India 587 crore, giving it access to fast-growing segments such as interior lighting systems, said Anmol Jain, managing director of Lumax Auto Technologies Ltd., leveraging the strengths of the two companies to deliver high-value integrated interior modules to passenger vehicle OEMs. Let’s take advantage.
IAC India is a supplier of interior systems to the passenger vehicle market and manufactures products such as console and instrument panels, and door and overhead systems.
Its largest customer is sports utility vehicle manufacturer Mahindra & Mahindra. Lumax Autotech, a part of the DK Jain Group, currently derives 25% revenue from the passenger vehicle segment and 36% from two-wheelers and three-wheelers.
“Our long-term strategy is to try and bring passenger vehicles and two-wheelers and three-wheelers into a 1/3-1/3 mix for Lumax Auto Technologies at a consolidated level, and post this acquisition we will be largely there. I think is that passenger vehicles maybe a little bit more than that, but that’s on purpose because many of the Lumax Auto Technologies joint ventures that we’ve signed over the last five years are more focused on the passenger vehicle space. And as they grow up, they will also start adding to this pool,” Jain said.
“The per vehicle kit price on a passenger car is much higher than that of a two-wheeler. Our operating margin is much better as compared to PV and SUV space. So this is a strategic change that we are looking to expand our profit margin.”
With the PV market moving towards a more premium segment, Lumax sees a good position to grow sales of a combined solution consisting of comprehensive interior systems including interior lighting, rather than individual products.
“We have seen a huge technological leap in outdoor lighting, for which we are definitely very strong and have been the market leader in India. However, around the interior lighting space, I think the evolution or technological shift is yet to happen,” said Jain.
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