Domestic demand puts Peenya units on recovery path

Domestic demand puts Peenya units on recovery path

Most sectors are working more shifts than a year ago

Sources said this is true only to industries mainly dependant on the domestic market.

These include automobile components, engineering, power, footware manufacturers (for domestic market), infrastructure and aerospace with their capacity utilisation going up by 15-20 per cent on an average.

However, export-oriented garment and textile sectors are still struggling — working only one or two days a week.

According to Peenya Industrial Association (PIA), automobile components and engineering goods manufacturing sectors are currently realising close to 50-60 per cent of their production capacities, as against 10-15 per cent during September 2008-June 2009 period.

While power sector has bounced back with utilising 60-80 per cent of its production capacity compared to 50-60 per cent in the last few quarters.

“In automobile components sector, industries dependent on car and two-wheeler market are doing better than those depending on bus and truck market,” Cosmos Engineering Limited owner, Savyasachi Biswas told Deccan Herald.

“However, with Centre’s Jawaharlal Nehru Yojna Scheme that saw a purchase order of 15,000 trucks (7,500 from Tata Motors and 7,5000 from Ashok Leyland), our firm is back to working all shifts as we supply components to Ashok Leyland,” he added.

Besides aerospace industries, which are few in number, consumer goods manufacturers, infrastructure and packaging industries are utilising at least 20 per cent more of their capacity than they did in last few quarters. Leo Footware Private Limited Managing Director Srikanta Datta who supplies canvas shoes to Paragon said “we were down during August 2008-May2009 period, however, we have now increased our shift and hired additional manpower to meet the demand,” adding that they manufacture 3,000 units of shoes per day and they need to do at least 4,500 to meet the demand.

Stiff competition
In the textile and garments sectors, players with a brand image are doing well, while smaller players are facing a drought of orders due to recession in the US and UK markets
Moreover, they are unable to cope with the competition from Bangladesh. “Bangladesh has emerged as a strong player with its export value double than India’s making it worse for us,” sources said.

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