CEAT Bangladesh Ltd. Journey & Challenges Presented at IBCCI seminar - 29 th March, 2014
CEAT Bangladesh Ltd. Corporate structure ‒ Company incorporated on 30 th May 2012 ‒ 70:30 JV between CEAT Ltd., India & AK Khan & Co., Bangladesh ‒ Professionally managed by independent management team Business Plan ‒ Meet approx. 40% of Bangladesh Tyre requirement by setting up a state-of-the-art tyre manufacturing plant in Bangladesh ‒ Capacity of 65 tons / day to manufacture tyres for all types of vehicles ‒ Proposed investment US$ 52 million ‒ Direct employment – Approx. 500 people ‒ Export approx. 20% of output of the plant ‒ Fully compliant, socially responsible & ethical business approach
About the JV partners - CEAT & AKK CEAT Ltd., India Indian MNC with history & legacy of 90 years and origins in Italy Annual sales of over $ One billion Largest exporter of tyres from India with exports of $ 200 Million Professionally managed company with over 5,000 employees; Publicly listed on Indian Stock Exchange Three plants in India & two in Sri Lanka A.K. Khan & Co. One of the oldest & most respected business houses in Bangladesh Very well respected for financial strength & Ethical business practices Diversified business interests in Textiles, Logistics, Telecom, Water Health, Securities, Fishing & Agro Forestry Contributing to Bangladesh economy through JVs in high technology and employment intensive areas.
Benefits to Bangladesh economy Largest investment in Bangladesh manufacturing sector by any Indian company Foreign exchange savings through import substitution & generating foreign exchange through exports Contribution to National exchequer by payment of taxes Generating local employment Manpower skill up-gradation through introduction of ‘Best Practices’ in manufacturing, marketing & management Superior customer service and product reliability through local presence of CEAT Multiplier effect through development of ancillary industries
Business timelines & current status Completed acquisition of 28 acres of land in Bhalluka, Mymensingh Funding tie-up completed for entire project investment of US$ 52 mn. Plant construction & mobilization work started Most of the ‘Long lead time’ machines ordered Commercial production to commence from mid 2015 Current manpower at 65 incl. 20 graduate engineers Started market development efforts by import sales through 3 branches Customers already getting a flavor of World class – Manufacturer provided ‘After sales service & warranty’
Experience so far Extremely positive Most government agencies very cooperative & welcoming Tremendous desire to support anyone who can do good for Bangladesh economy Speed of getting things done is very good. Permissions & licenses get done if you follow guidelines & prepare documentation well Work culture and ability to learn is very good Business & economy move despite the socio-political turmoil
THANK YOU