JTEKT India Ltd

JTEKT India Ltd. (formerly known Sona Koya Steering Systems Ltd), is the largest manufacturer of Steering gears in India and a leading supplier of Hydraulic Power Steering Systems, Manual Rack & Pinion Steering Systems, Collapsible, Tilt and Rigid Steering Columns for Passenger Vans and MUVs. The Company is presently engaged in the business of manufacturing steering systems & other auto components for the passenger car and utility vehicle manufacturers in the automobile sector. The company has technical Collaboration from Koyo Seiko Company, Japan and Mando Machinery Corp of Korea. Koyo Seiko Company hold 20.47% Equity Stake of the company. It has plants located in Chengalpattu, Tamilnadu and Gurgaon, Harayana. JTEKT India Ltd, incorporated in June, 1984, commenced business in September 1985 as a key supplier to Maruti Udyog ltd. The company commenced commercial production on 1st October 1987 after completion of project for manufacture of Rack & Pinion Steering Gears and Steering columns with a capacity of 125000 Nos. Sona Koya is the Market Leader in the Indian Steering systems category in volume terms with over 50% share and in value terms it is second largest player with over 30% share. This imbalance is mainly due to sona's product mix, still the low value manufacturing steering systems contributes more to sales than power steering systems. In February 1988, the company came out with a 2-3 crore public issue to part finance its Rs.11.62 crore project to manufacture 1.25 lacs steering gear assemblies p.a. In August 1991, it came out with a rights issue of PCDs to finance the capacity expansion from 1.25 lac pa to 1.75 lac pa and for diversification to manufacture 50000 axles assemblies. The company signed an MoU with oberland Marigold, Germany to manufacture metallic Catalytic convertors which are smaller, more efficient and cost-effective. With environmental protection devices having been made compulsory, there is a huge market for convertors. SSSL has tied up with Mahindra and Mahindra to form a new firm, Mahindra Sona. The Company was accredited with the ISO-9002 certitication by RWTUV. In 1990-91 the Rear Axles Assemblies project was completed with a capacity to manufacture 50000 Nos. In 1992-93, the capacity of Steering Gear Assembly was expanded from 125000 Nos to 315000 Nos. In 1997-98 the company implemented the power steering project at a total cost of Rs.11 crores. The trail production began in March 1998. In 1998-99 the company setup a new plant at Chennai with a total investment of Rs.724.30 Lacs for steering requirements of Hyundai and has commenced production in December, 1998. The capacity of Steering Gear Assembly including components were expanded from 315000 Nos to 550000 Nos, Axle Assemblies from 50000 Nos to 92000 Nos and Propeller Shaft with capacity of 146000 was created during the year. The company received preferential capital of Rs.10 crores from its collaborators M/s Koyo Seiko Co, Ltd, Japan in 1999-2000, with this the name of the company was changed from sona steering systems to sona koya steering systems ltd. The company was awarded Maruti's 'Best Vendor Award' in the category of steering and suspension components. In 2002-2003 the company set up an R & D Division, where engineers developed a new, lighter weight collapsible steering column. In October 2004, the company bought 21% stake in Fuji Autotech France S.A.S (FAF). The company also entered into Joint Venture with Fuji Kiko Co Ltd Japan (associated company of Koyo Seiko Ltd Japan) in France. In 2004-2005 the company had set up a machining lines at the companies units in Gurgaon and Chennai and also set up a 100 percent EOU near Chennai to execute Manual gear order from a North American automaker. The companies capacity in 2004-2005 stood at 847000 Nos for Steering Gear Assembly including components,153000 Nos for Axle Assemblies, 396000 Nos for Case Differential Assembly, 132000 Nos for Propeller shaft, 120000 Nos for Rack & Pinion Assy and 200000 Nos for Column & UJ Assy. During 2006-07, the Company added capacity for manufacturing 300,000 units of C-EPS at its Gurgaon plant. It established two new manufacturing plants at Uttarkhand and Singur, in addition to the existing plants at Gurgaon, Chennai and the newly developed facility at Dharuhera. Operations commenced at its Dharuhera plant with shipments of Column type Electronic Power Steering (C-EPS) in Jul' 07. During the year 2007-08, the Company got into Joint Venture Agreements with JTEKT Corporation, Japan; Fuji Kiko Co. Ltd., Japan and Arjan Auto Private Limited, India. Consequent upon these Joint Venture Agreements, the Company created three new subsidiary companies, JTEKT Sona Automotive India Limited (JSAI), Sona Fuji Kiko Automotive Limited (SFAL) and Arjan Stampings Limited (ASL). It also got into a Joint Venture Agreement with AAM International Holdings Inc., USA, whereby a Joint Venture Company in the name of AAM Sona Axle Private Limited was established. During 2008-09, the Company started commercial production of Pinion Valve Assembly & Tubular Shafts from its newly developed facility at Dharuhera. Construction was completed at the plant for light axles under the JV with American Axle & Manufacturing Holdings Inc. (AAM) at Pantnagar, Uttrakhand. The Company's key subsidiaries JTEKT SONA Automotive India Ltd. (JSAI) and Sona Fuji Kiko Automotive Ltd(SFAL) went into commercial production in 2009-10. The Company commenced commercial operations with effect from 1st February, 2010 with the manufacturing of Reduction Gear Assembly and later started mass production of Column Type Electric Power Steering System (C-EPS). It set up a satellite plant for post assembly operations at Chenna and Bangaluru for supplies to Nisssan and Toyota respectively. Commercial production of the Jacket Assembly for Tilt and Non-tilt models for supply to domestic customers started in March, 2010. As Company moved forward to meet new targets, operations across all three locations - Gurgaon, Dharuhera and Chennai - expanded and grew significantly. New lines were added and customer inspections were undertaken. In keeping with the profitability objectives, improved machinery maintenance, drives to reduce down time, improved tooling systems, manufacture of carbide cutting tools, in-house repairing of tools, low cost plating on drills and hobs and multi- skiling of the shop floor workers was undertaken. The Company used lean manufacturing concepts like Value Stream Mapping, Kan-ban etc. on the production shopfloor, which enabled it to reduce its WIP (Work in Progress) and helped in synchronized manufacturing targeting at meeting the customer requirement which continued to show an upward trend. The Dharuhera plant started supplies of parts and sub-assemblies to its Joint Venture Companies namely Sona Fuji Kiko Automotive Ltd and JTEKT SONA Automotive India Ltd. at Bawal (Haryana). During the year 2013, the Company has acquired 30.08% of the Equity Capital from Arjan Auto Private Limited held by it in SSL and resultant SSL became a wholly owned subsidiary of the Company. The Board of Directors of the Company on 1st June, 2013, approved of a Scheme of Amalgamation between Sona Stampings Limited (SSL) and Company and accordingly, SSL stood merged with Company with effect from the appointed date i.e. 1st April, 2013. In FY'17, the Company invested in acquiring new technology for manufacturing Intermediate Shafts (IMS). On February 01, 2017 Sona Autocomp Holding Limited (SAHL), one of the Promoters of the Company, entered into a Share Purchase Agreement with JTEKT Corporation, Japan, a Technical and Financial Collaborator of the Company and a member of the Promoter Group. In terms of the said Share Purchase Agreement, on May 18, 2017, JTEKT acquired from SAHL 25.12% of the equity shares of the Company on a fully diluted basis. Consequent to said transaction, JTEKT's shareholding in the Company stands increased from 20.10% to 45.22%. Accordingly, JTEKT made an Open Offer' to all the public shareholders of the Company, to acquire up to 51,672,877 fully paid-up Equity Shares of Face Value of Re 1/- each of the Company, constituting 26% of the Equity Share Capital of the Company. The said Open Offer' is being made at Rs 84/- per Equity Share. During the year 2017-18, JTEKT Corporation, Japan, one of the Promoters of Company, acquired complete stake of 25.12% held by Sona Autocomp Holding Limited, the Company's Indian Promoter. Post conclusion of the said Open Offer, the shareholding of JTEKT Corporation, Japan increased to a level of 70.45% and along with Maruti Suzuki India Limited, the total Promoter Group shareholding was increased to 77.39%. In order to bring public shareholding to the minimum threshold level of 25%, JTEKT Corporation, Japan sold excess Promoters' shareholding of 2.39%, by way of Offer for Sale' (OFS). After the aforesaid transaction the Company became subsidiary of JTEKT Corporation, Japan and consequently became a member of The 'JTEKT Group' and the resultant, the name of Company was changed from Sona Koyo Steering Systems Limited' to JTEKT India Limited' effective from 7th April, 2018. The Hon'ble National Company Law Tribunal, New Delhi (NCLT) vide its Order dated 7 March 2019, approved Scheme of Amalgamation' between JTEKT Sona Automotive India Limited (JSAI), a subsidiary of JTEKT India Limited and the Company (JIN) and their respective shareholders and creditors, which became operative from the Appointed Date' i.e. 1 April 2018. As a result, JSAI was amalgamated with the Company, which stood dissolved without winding up. Read More