Ajanta eyes China firm for Rs 1lakh electric car

The $325 million (Rs 1,500-crore) company, which also makes electric bikes, vitrified tiles and CFL lamps, has made a layout of Rs 100 crore to acquire an existing assembly unit of an undisclosed carmaker, which can roll out 5,000 units a year. The deal is likely to be inked within this year as valuations are currently low.

An executive in the company, who did not want to be named, also said that the group would come out with its own brand ‘Oreva’ for the cars and indigenise the design so that it suits the urban population that it intends to target. Oreva, derived from the names of Ajanta’s founder OR Patel and his wife Revaben, is an existing brand for its tiles.

Ajanta group director Jaysukh Patel refused to comment on his plans on the acquisition. He, however, said, “We have not yet decided on it but are seeking government support so that we can develop cheaper vehicles for the Indian market.” VAT and excise duty put together make almost a fourth of the total manufacturing costs of the vehicle. “If the costs are lowered, we are capable of manufacturing batterypowered cars at Rs 1 lakh or less,” he said. The acquisition will help the company acquire technologies for moulding, designs and battery production among others. Also, it would help in creating and establishing a new market for electric cars in India.

Two years ago, the group ventured into two-wheeler electric vehicles two years back with an investment of around Rs 300 crore. It manufactures close to 10,000 bikes every year at its Kutch facility.
Mr Patel, who along with his father and uncle Manubhai Patel (who now runs the Samay group), had launched Ajanta clocks in the early 1980s and stunned the market with sub-Rs 100 clocks, has already designed a prototype of the vehicle and is personally driving it around on his 400-acres manufacturing facility near Morbi, near Rajkot. The prototype runs 120 kms per charge of 7 units of electricity, costing nearly Rs 35 per charge.

“We have designed more than 10 battery powered cars of 4-seater and 6-seater capacity and are testing them now,” Mr Patel said. He also claimed that the 6-seater would cost nearly Rs 1.5 lakh while 4-seater can be available at Rs 1 lakh. Ajanta was planning to set up a battery production unit near Morbi so that it can bring down costs further, but it dropped such plans owing to raw material issues. The group has a strong distribution network already with a diversified product portfolio and claims it can modify some distribution centres across the country into charging-cum-maintenance stations.

Manoj