In an intriguing advancement aimed at consolidating its foothold in the emerging aluminium component manufacturing landscape, Craftsman Automation recently announced its acquisition of the residual 24% stake in DR Axion India (DRAIPL). This acquisition, following Craftsman's previous purchase of the 76% stake in DRAIPL in February 2023, marks a significant milestone in the company's expansion journey.
DR Axion India, with its specialisation in manufacturing aluminium cylinder heads, cylinder blocks, and auto components for passenger vehicles, presents a lucrative opportunity for Craftsman Automation to bolster its presence in the passenger vehicle segment. The acquisition is poised to unlock synergistic benefits, offering enhanced process efficiencies and access to DRAIPL's esteemed customer base.
The Chairman and Managing Director of Craftsman Automation, Srinivasan Ravi, announced that after acquiring a 76% stake in DRAIPL in February 2023, the company is now consolidating its shareholding by acquiring the remaining 24% stake in DRAIPL.
"While DR Axion Co, Korea, ceases to be an ultimate shareholder in the DRAIPL, it will continue to provide a technological collaboration for new product and technology development," he asserted.
Venturing into e-Mobility solutions
Craftsman's foray into the e-mobility solutions market for passenger vehicles underscores its commitment to innovation and sustainability. By capitalising on DRAIPL's expertise and market positioning, Craftsman aims to carve a niche in the rapidly evolving landscape of electric vehicle technology.
Financial implications and future outlook
The acquisition, valued at INR 250 crore, is slated for completion by June 30, 2024. With Craftsman Automation reporting a 12.74% year-on-year rise in consolidated operating revenue during the fourth quarter of fiscal year 2024, the company's strategic acquisitions and operational inquests bode well for its future growth trajectory. If you wish to learn more about the international aluminium market in more detail, please have a look at AL Circle's special report, Global Aluminium Industry Key Trends to 2030.
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