Subros Bets On Diversification Amid Auto Slowdown
Air conditioners for trucks are getting higher than expected demand, says Subros.
Subros Ltd.‘s home and railway air conditioning segments have offset the lower capacity utilisation levels due to the slowdown in the auto sector, according to its Vice President Pramod Duggal.
“We are now at 75-80 percent, a fall of 10-15 percent from the levels clocked before the industry downturn,” Duggal told BloombergQuint. “But there is no substantial impact as the company is insulated with growth from its other segments.”
Auto sales have been falling since the Diwali festival season due to higher upfront insurance costs and an increase in vehicle prices. Inventory pile up at dealerships has prompted production cuts.
Maruti Suzuki, one of the key clients of Subros, said its production fell as much as 18 percent year-on-year to about 1,51,188 units, according to its exchange filing. The company said it made 18.88 percent fewer passenger vehicles—comprising Alto, Swift and Dzire—over the last year, at 1,48,095 units.
Air conditioners for trucks are getting higher than expected demand, Duggal said, adding that there may be a notification by 2022 making the component compulsory for commercial vehicles. The company will be launching air conditioners for railway coaches in the next one and a half years, he said. “We expect the railways business to reach Rs 100 crore in the next two to three years.”
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