Having acquired UK-based AEI Cables for Rs 108 crore in September, Delhi-based cable maker Paramount Communications is working to turn it around at the earliest.
Gets ready for expansion at home
KOLKATA: Having acquired UK-based AEI Cables for Rs 108 crore in September, Delhi-based cable maker Paramount Communications is working to turn it around at the earliest.
It is drawing up strategies to improve the topline of AEI further.
Meanwhile, though Paramount has retained the AEI management team, sources said it may consider cutting a few job-cuts at the UK firm in the coming quarters.
Sanjay Aggarwal, chairman and CEO, Paramount Communications Ltd said, “We have no plans of cutting jobs currently, but will review at regular intervals and if there is any overstaffing, we will have to work out something.”
The two companies are working on synergies and expect to turn AEI around by the next fiscal-end, he said.
“We are targeting to be a $1 billion company by 2010 as there is an increased government focus on sectors like power generation, transmission, distribution and infrastructure development,” he added.
At the organic level, Paramount is looking to grow its core business of power cables. It has already acquired 25 acres of land near its Khushkhera plant in Rajasthan and started land development and civil construction as part of the third-phase expansion, expected to be completed by the middle of next year with an investment of Rs 80 crore.
The second phase expansion is expected to be completed by this month-end.
Under the first phase, completed last fiscal, it added a capacity of 5,000 km low-tension and 1,500 km high-tension power cables at its Dharuhera plant in Haryana with an investment of Rs 15 crore.
Going forward, Paramount will also focus on its two other core businesses — railway and telecom cables. The company is among the largest players in railway cables and is rapidly capturing marketshare in power and telecom sectors.
The company has forayed into new sectors like construction, engineering, real estate and wind power, and received repeat orders from existing clients. It has also been able to cross-sell its cables and wires to existing clients.
The cable industry is highly fragmented with small and unorganised players having a major share.
In the organised segment, Paramount has competition from companies like Finolex Cables, Universal Cables, Birla Ericsson, Havells India and RPG Cables.
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