Indian automotive manufacturing company and global automotive component supplier Motherson Sumi Systems (MSSL) has announced plans to expand business in four key non-automotive areas: aerospace, logistics, technology, industrial solutions, and health and medical with a revenue generation accounting for 25% by 2025, the company said.
The company has recently received a nod from the NCLT for the group's restructuring.
According to the company statement, the restructuring, which started in July 2020 and has led to the creation of two companies, is done to simplify group structure as well as align itself for 'Vision 2025' which targets revenues of US$ 36 billion with 40% return on capital employed (ROCE).
Laksh Vamaan Sehgal, Group vice-chairman, MSSL, said that the diversification to non-auto segments will help the company leverage the existing business strength of global presence, product design, and development expertise.
"We spent the past five years thinking about areas of strength and where we can make maximum impact. We found that strength is in manufacturing and supply chain. These are the segments where we can use expertise that we have developed in the automotive side," he said.
Motherson had also recently announced that it has acquired a majority stake in the Bengaluru-based CIM Tools, a leading supplier in the aerospace supply chain.
"We reached out to Boeing and Airbus and showed what we have done on the automotive side and with their blessings we took over CIM tools as they want their suppliers to grow in this region. We want to grow that business and use that as a launching pad to grow operations globally for these customers," Sehgal said.
"We already had IT design software company which has done very well for us. Now we want to open that up for external customers as well and grow it. It's promising because we have seen a lot of customers wanting the same solution that we have built for internal purpose like ERP, product lifecycle management systems. We have organic orders already and customers are enthused to see us go into the new areas," he said.
In the logistics space, the company has a joint venture with a Japanese premium car carrier, the company statement added.
According to the plan, the domestic wiring harness (DWH) has been demerged from MSSL and is now in the process of being listed. Samvardhana Motherson international (SAMIL) will hold 33.4% of the DWH company, it said.