New Delhi: India’s leading car maker Maruti Suzuki and Gujarat government has finalised the deal to set up the automobile major’s latest manufacturing plant at Becharaji in Mehsana district, North Gujarat with investment of Rs 4,000 crore in the initial phase.
For the preceding few months, consultations have been held between the Gujarat government and Maruti officials. The deal, subsequently, was approved by the Maruti Suzuki board of directors on Saturday.
Suzuki Motor Corporation chairman Osamu Suzuki and Maruti chairman RC Bhargava met chief minister Narendra Modi previous month to discuss the proposed plant and then, officials of the state government and the auto firm worked out the details of the deal.
“The plant will come up near Becharaji in 500 acre plot, which the state industries department has earmarked for the auto firm,” a top official from the state industries said.
He added that Becharaji is strategically located and is a part of the ambitious Delhi-Mumbai industrial corridor (DMIC).
India’s auto industry body this month slashed its growth forecast to 2-4 percent for this fiscal year that ends in March 2012, down from 12-14 percent estimated previously.
The company said that its operating margin in the quarter was at 3 percent compared to 8.1 percent in the year ago period, hit by lower sales volume and adverse foreign exchange rates.
Shares in Maruti, which has a market value of $6.6 billion, have fallen almost 21 percent this year, in line with a fall in rival Tata Motors shares but over 13 percent drop in the Mumbai market.