LML India yesterday announced that a new management team would look after the business. A K Chadha is the new Chief Operating Officer, said Deepak Singhania, MD, LML, adding that the company is still scouting for a new CEO. Chadha joins LML from ICI paints, leading international decorative paint manufacturer.
Asked with the professional team in place if the promoter family will take a back seat, Singhania said, "We have a lot of work to be done in a very short time span. Most family-owned companies are coming to terms that human resources is a very essential asset. In terms of ownership and promotion we have a role to play and our professional team too has a significant job to handle."
Singhania said that the company is being de-layered to meet the desired growth plan.
On the sidelines of a press conference, Singhania said, the company has become free from financial constraints this year. With the financial restructuring completing just a few weeks ago, he said, "the most critical chapter in the company's history has been closed."
The company was carrying old debts close to Rs 310 crore, which has been settled as follows - Rs 118 crore by way of issues of non-convertible preference capital to lendors, Rs 8 crore by equity share, Rs 108 crore by reshedulement, Rs 12 crore by payouts and Rs 6 crore by write off.
The company is now backed with fresh funding of Rs 228 crore and is looking at a four-pronged growth strategy. "We are expanding the presence across all segments with a new product launch in the entry level segment in 2005. Also, we are enhancing the focus on customer service, strengthening dealer and service network, looking at production capacity expansion and value-engineering programme to generate further cost efficiencies. An increasing push on the export markets will further boost the growth," he said.
On the new product launch, he said, the entry-level two-wheeler will be a 100 cc bike and will be launched in August. The company is looking at grabbing 10 per cent market in motorcycle segment and retaining its 20 per cent market share in the scooter segment.
He said that the company has initiated an expansion programme to double its four-stroke motor cycle production capacity from the existing 2,00,000 units per annum to 4,00,000 units per annum by October 2005. The company aims to complete this programme by March 2007 and the capacity is projected to increase to 7,20,000 motorcycles and new generation four-stroke scooters per annum.
Singhania said that the company has specific plans to increase its export levels. "The company is targeting exports at 10 per cent of its business by 2007-08."