Sogefi ups expectation from non-European markets like India
In 2013, these markets contributed 35 per cent while Europe added 65 per cent to the total sales. The revenue contribution from non-European markets was 30 per cent in 2012.
“I expect to see Europe going flat. There are some reports suggesting Europe is growing, but this is because of a lower base. If you see, 2013 was the worst year for Europe since 1975,” said Guglielmo Fiocchi, CEO, Sogefi in an interview with ETAuto.com. The 1.3 billion Euro firm has taken the strategic decision to leverage the new markets to maintain its high growth aspiration.
Sogefi expects to cut 50per cent revenue from the new markets in next three to four years, and Asia is going to play a major role. “We have grown in double digit around 25 per cent in North America last year while in Asia (India & China) we grew over 30 per cent. Europe was almost flat and in the coming year also it doesn’t expect more than four per cent growth in its home region.” Fiocchi added.
Elaborating on the company’s strategy, Fiocchi said “We are moving our business on three main pillars – Technology, Building relationship with Big OEMs and Grow out side Europe.”
Merging Indian Subsidiaries Firming up its strength, recently, the company merged its Indian Joint Venture with MNR- Sogefi MNR Filtration India with the Indian subsidiary of recently acquired Systems Moteurs India. “The merger will help us in increasing our business. We will have opportunity to cross promote business among the customers of the both the companies,” said Fiocchi.
The new company formed after merger, named Sogefi-MNR Engine Systems India, will have as its partner the Indian group MNR, which has been Sogefi’s partner in India since it made its first investment in that country in 2008. The aim is to capitalize on the success obtained in the filtration sector by the alliance between Sogefi and MNR, replicating it in the air & cooling segment too. In the new company, MNR will have 30 per cent stake while 70 per cent will be owned by Sogefi.
Sogefi India can bank on a local production presence structured over four factories (two in Bangalore, and one each in Pune and Delhi) with more than 500 employees.
The main products marketed by the Sogefi group in the sector of engine systems for two, three and four wheeled vehicles in India are air and diesel filters, air intake systems, and water pumps. In India the company’s joint revenue stood at Rs 150 crore in 2013. Going forward the company is looking opportunity in ASEAN countries to export from India in near future.