Leading tyre maker MRF is embarking on a major expansion plan involving an investment of Rs 3,000 crore to set up greenfield factories and planning to ramp up capacity at its existing plants to maintain market share. The com-pany also indicated that

it is aggressively pursu-

ing inorganic growth opportunities.

Of the proposed inves­tments, about two-thirds will be spent on greenfield factories in Tiruchi (Tamil Nadu) and Medak (Andhra Pradesh). “We are expan­ding radial tyre capacity across our plants. While we have commenced civil works at Tiruchi, a greenfield factory is being established at our existing manufacturing complex at Medak,” K M Mammen, chairman and managing director of the company, said at the company’s 49th annual general meeting in Chennai.

The Rs 900-crore Tiruchi plant, likely to be one of the largest manufacturing facilities of MRF, will commence production next year. The plant is being set up to make passenger car radials to meet growing demand. “Most of our expansion plans are funded through internal accruals,” added Mammen.

MRF’s upcoming greenfield factory, near the company’s existing Medak operations, will make tyre for cars and two-wheelers. “We are putting up two lines, one for passenger car radials and another one for two-wheelers. This expan

sion will see increase in our capacity by 20-25 per cent in those two segments,” Koshy Verghese, MRF’s executive vice-president of marketing, said.

“We have established a greenfield factory in Sri Lanka through a subsidiary MRF Lanka. The factory, in which we have so far invested about Rs 9 crore, at present exports a major part of is production to China. Our margins there are very low due to low volumes. It reported losses of about Rs 2.3 crore on a turnover of Rs 7.5 crore. We hope to turn it around by expanding the export basket because there will be a peaceful envir­onment in the future,” he added.

Mammen said the rising price of natural rubber, the basic raw material, is a worrying factor.