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To partner with Chinese co Jian Yin

Bangalore , Oct. 26

Suprajit Engineering, automotive and meters manufacturing company, proposes to set up a cables production facility in China under a joint venture with Jian Yin Yuan Feng Communications Equipments Company Ltd.

Suprajit will have the majority stake of 70 per cent in the new venture planned to serve as a delivery facility for Suprajit's global customers.

The details of the equity and the capacity are expected to be finalised in the next two to three months and the project likely to be implemented in the next one year.

Suprajit, which had a 50:50 joint venture with the UK based Carclo, eventually bought over the subsidiary, CTP Gills Cables.

The former English company's customer profile includes the European and American automotive majors such as Ford Jaguar General Motors and Toyota.

Mr Ajit Kumar Rai, Managing Director, told Business Line that with China said to emerge as the third largest automotive market, global car makers were vying to have a share.

With their plans to have ready to access to component facility for competitive pricing of their products, Suprajit Surpajit decided to foray into China. Mr Rai said apart from catering to the captive customers, the China joint venture could be a sourcing platform for exports to other countries.

Profit down

Suprajit also announced its financial results for the quarter ended September 2006. The company reported a dip in its profit by about 14 per cent to Rs 2.78 crore from Rs 3.16 crore, albeit on a marginally higher income of Rs 38.31 crore (Rs 33.7 crore).

A company spokesman said the lower profit was largely due to higher staff cost and increased interest outgo.

The increased staff cost of Rs 3.51 crore was due to an old payment commitment, said the spokesman adding that the company's higher interest cost of Rs 1.13 crore (Rs 31.48 lakh) was to meet the short-term loan, to meet the cost of acquiring CPT Gills Cables.

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