The leading Tier 1 Supplier of Automotive Components UNO MINDA Group’s flagship company Minda Industries announced its interest in buying a 51% stake UZ Chasys in Uzbekistan; the deal is nearly INR 58 crore.
As per the World Bank, the economic conditions in Uzbekistan deterred due to the COVID-19 crisis in 2020 will speed up the recovery process in 2021. The country’s liberalization phase to reform land, labor, capital markets, and state-owned enterprises will ensure stability and growth. The reform will lead to acceleration for inclusivity addressing the legacy state-led model. Therefore divesting stakes in the government-led entities represent economic growth and diversity. The auction of stakes by UzChasys, which specializes in manufacturing automobile headlights and lamps, is a part of the economic reformation. The company is a dominant supplier of original equipment manufacturers (OEMs) in Uzbekistan with higher exports.
The Uzbekistan automotive market dropped in 2020 by 8.6% yet is expected to have growth with measures to reform the auto industry in 2021. In January the Uzbek President Shavkat Mirziyoyev ordered the government to plan automotive industry reforms to bring a competitive edge and high production. The country agrees to attract direct investments in the industrial assembly of cars and production of nearly 60,000 budget cars and electric vehicles every year to facilitate increased production.
Minda Industries recorded a net profit that increased 971.15% to Rs 140.32 crore in the quarter ended March 2021 compared to the same period in 2020. The sales rose 49.44% to Rs 2238.27 crore in the quarter ended March 2021. The company operates in 71 manufacturing plants worldwide. The company planned to expand four-wheel lighting, and alloy wheel businesses in March, leading to shares jump 3.39% to Rs 560. Since the demand increased, the company planned to grow the business profile and tap international markets to export business from the new manufacturing plant.
The previous year was damp for all the businesses, and the Indian auto industry reeled through the covid impact. The total automobile sales fell year on year by 13.05 percent to 41,289,28 units. The $118 billion Indian automobile industry has an optimistic forecast of reaching $300 billion by 2026. The production in FY20 was 26.36 million vehicles on an annual basis. A study by McKinsey & Company says the global automotive market is estimated to grow to $3,800 billion by 2030 at a compound annual growth rate (CAGR) of 3 percent.