In July 2013, the private equity unit of Citigroup Inc, Citi Venture Capital International bought a 'substantial stake' in the Bangalore-based manufacturer of precision engineered components, Sansera Engineering Pvt Ltd. The deal, worth Rs 340 cr, is aimed at primarily growing the company three-fold over the next four years, and also to partly buy shares of promoters.
In a recent interaction, FR Singhvi, Joint Managing Director, Sansera Engineering Pvt Ltd said the company is looking at manufacturing certain other critical auto parts, as also investing in growing its newly-started Aerospace division for machining of aerospace parts. About 96 % of Sansera's business is from the automotive sector. Singhvi said the company would also explore acquisitions, if found suitable.
As a company, Sansera produces world-class quality at Indian prices. And automation has been a key enabler in that regard. Bulk of the R&D resources at Sansera is used in automating processes at its various facilities. A number of processes have already been automated, including the machining of connecting rods as well as the process of forging. The fully-automated forging machine at Sansera is one of a very small number present in the country, Singhvi said.
The producer of engine components such as crank shaft assemblies, rocker arms, connecting rods, gear shifter forks and fuel injection parts, among others, Sansera has recently begun manufacturing of gear shifters for Honda Cars India. Interestingly, these gear shifters are now made by the process of forging and machining, instead of earlier product made from sheet metal. Singhvi said this product is now being used in about 13 of Honda's engines, including some export models.
More recently, Sansera has been supplying sintered sprockets to a large OEM that had a product recall a few months ago due to the failure of its sprockets in its turbo-charged engines. The OEM was already being supplied rocker arms and connecting rods by Sansera. This sprocket is now being manufactured by forging, and is being supplied on a daily basis for the past few months in five or six different countries.
The company is also entering into the production of parts like common-rail injector body and fuel injectors for fuel injection systems. This is in conjunction with supplying these parts to Bosch, which is a new business that the company has entered into. Bosch is the first Tier-I supplier that Sansera has begun manufacturing products for. Another product that Sansera is looking at exploring is that of single-piece crankshafts for two-wheelers.
To begin with, having to manufacture class leading products for the global market with Indian machines, and at Indian prices, was a challenge. Imported machines provided the required quality, but would not justify the prices. This led the company to manufacture its own machines two decades back, or add parts to existing machines in order to make parts to its specifications. "Machines developed in-house can be designed to be focussed more to the components that are being produced," said Singhvi adding these machines can be made more efficient, by way of power consumption and space, and thereby reducing production cost.
A machine is also made in-house when there is a need to combine operations or processes within a very short time. Designing of new machinery does not involve too much R&D, noted Singhvi, but rather comes from needs that are practical and commercial in nature. Developing machines not only help Sansera from the production cost point of view, but also enables the company to manufacture components to precise specifications.
There, however, are no immediate plans to market these machines, Singhvi said, but could consider that later.
In addition to its own R&D requirements, Sansera Engineering also undertakes R&D of products on behalf of i development, and provides designing, modelling and testing capabilities to them. Virtual testing, in fact, is a key capability at Sansera. Sansera invests roughly around one per cent to 1.5 % of its revenue into R&D.
Text: Naveen Arul