Cummins aims to more than triple India investment

* To raise investments in India to $500 mln from $150 mln

* To add 5 business segments new to India operations

* Sees India contributing 15 pct to global business by 2015

* May invest $75 million in Africa over five years

By Kaustubh Kulkarni

PUNE, India, Jan 15 (BestGrowthStock) – U.S. engine maker Cummins
Inc (CMI.N: ) aims to more than triple its investment in India to
$500 million by 2015 as it introduces at least five new business
segments, a top official told reporters.

The company, which manufactures truck engines, power
generation equipment and other vehicle components, plans to
increase its investment in India from a total of $150 million
allocated so far, Chief Executive Tim Solso said late on Friday.

The new projects could include manufacturing of
high-pressure fuel systems, 2.8-3.8 litre diesel engines for
commercial vehicles and emission solutions, Solso added.

The Columbus, Indiana-based group, which runs about 10
entities including Cummins India (CUMM.BO: ), said it had so far
spent 5 billion rupees ($110.2 million) of the allocated amount
for its manufacturing site in Phaltan near Pune.

The site includes manufacturing units for diesel and gas
engines, power generators and redevelopment of existing engines,
it said.

“Historically, we have been spending $40 million a year (in
India) but we are well above $100 million this year,” Solso
said. “That gives you some idea about the company’s expansion.”

Cummins, which currently gets about half of its domestic
revenue from supplying the power generation industry, has also
started a project in China to build 2.8-3.8 litre diesel engines
meant for trucks and vans.

Solso said the company would take “less than a year” to
evaluate whether these engines can be made in India.

By 2015, the group sees India’s contribution to its global
business rising to 15 percent from the current 10 percent and
exports from India rising to 40 percent from 30 percent, he
added.

“With the domestic market growing so fast, we haven’t been
able to export much. With the increased capacity, India will
become a much larger exports market for us,” Solso said.

EYES EXPANSION IN AFRICA

Cummins group, which has operations in Nigeria and South
Africa, also is exploring opportunities to invest about $75
million in Africa over five years to build engines used in
sectors such as mining, power generation and oil and gas, Solso
said.

“The possible countries where we might invest further are
Egypt, Angola, Nigeria, Morocco and South Africa,” he said.

Last year, the group spent about $620 million on capacity
expansion globally. Solso expects the investment to boost its
sales in the current year, he said.

“We had a turnover of $13 billion last year globally and it
would rise by 15-20 percent,” he added.

Shares of the company, which the market values at $22.33
billion, closed at $112.56 Friday on the New York Stock
Exchange. The stock has more than doubled in value in the past
year.

Shares of Cummins India closed down 2.53 percent at 719.70
rupees on BSE.

($1=45.38 rupees)

(Reporting by Kaustubh Kulkarni, Editing by Jane Baird)