Hyosung Chairman Hyun Joon Cho on Feb. 18 held talks with Indian Prime Minister Narendra Modi, just 10 days after a meeting with Vietnamese Prime Minister Nguyen Xuan Phuc.
In his talks with Prime Minister Modi, Chairman Cho agreed to build his company’s first spandex plant in India, specifically in the state of Maharashtra, by 2019. This facility is expected to serve as the company’s cornerstone in the Indian market.
Hyosung is expected to use India as a strategic base for its so-called plan “100 Years of Hyosung” along with Vietnam to expand the company’s global reach. Hyosung Vietnam will emerge as a global outpost for the production of core products such as spandex and tire cords in the European and Asian markets. And Hyosung India is aiming to grow into a leading player in the Indian market through continuous expansion.
|Chairman Hyun Joon Cho of Hyosung group|
Chairman Cho: “Expect mutual growth with the Indian economy”
In his meeting with Indian P.M. Modi, Cho said, "Hyosung since 2012 run a trading corporation in New Delhi, having started doing business in New Delhi in 2007. From 2016, the company expanded its business by setting up a plant for ultra-high voltage breakers in Pune (the Indian state’s second-largest city) and achieving sales of over USD 300 million a year.”
"India is one of the world’s largest textile markets and we expect remarkable growth in the Indian consumer market. With the Indian government's full support for our new plant, I sincerely hope that Hyosung and the Indian economy will grow together.”
Modi replied, "Korea is playing a key role in the 'Make in India' policy, which is driving India's high economic growth. Hyosung's investment will strengthen India's future competitiveness and industrial base. We will provide a good environment for companies to continue investing in India."
Initial investment of USD 100 million, expand Hyosung’s share of India’s spandex market to 70%
Hyosung will make an initial investment of USD 100 million to build the spandex plant in Maharashtra. The site will cover around 40 hectares in the Auric Industrial Complex near the industrial city of Aurangabad. Completion of the facility is slated for 2019. Hyosung will continue raising its investment in India based on market demand and growth prospects.
With a population of 1.35 billion, India boasts one of the world’s largest domestic market in addition to excellent IT technology and skilled human resources. This emerging economy also sees annual growth exceeding seven percent, and is expected to become the world's third-largest economy in 2030 trailing the U.S. and China.
The Indian textile market is also expanding rapidly. Specifically, the Indian market for spandex grew at a compound annual growth rate (CAGR) of over 16 percent from 2012 to 2017; growth is expected to reach 12 percent in 2020. Maharashtra, where Hyosung will build its Indian plant, is a key region for textile production in India.
Hyosung’s spandex brand Creora has a market share of around 60 percent in India. The company focuses on sales of spandex for Muslim wear like the hijab, lingerie, sportswear, denim and diapers. By 2020, Hyosung will eventually expand production for the high value-added premium market after its new plants begin operating at full capacity. In addition, the company aims to achieve higher profit by raising its share of the Indian spandex market to 70%.
The Indian spandex market has been an oligarchy dominated by a few Indian companies. Based on its unique functions and high-end technology as proven in the global market, Hyosung expects to secure profits quickly under a marketing strategy that fully caters to Indian customers.
The company’s plant in Maharashtra will create jobs and boost the regional economy, as well as spur the development of businesses in the state such as weaving, knitting, salt processing and sewing.
Hyosung Chairman Cho also discussed the expansion of the company’s business lines including industrial textiles, heavy industry and automation equipment for finance. Given the expected difficulties expected for new business lines such as carbon fiber and aramid, he also requested the Indian government’s support including deregulation.
The CEO also expressed his company’s willingness to participate in the bidding for the Power Grid Corporation of India, Ltd. (PGCIL) in the heavy industry sector. Hyosung also plans to expand its “Make-in India” policy in eco-friendly transmission systems such as ESS and STATCOM.
Participate in Magnetic Maharashtra Convergence 2018 Exhibition with Lamborghini and Tata Group
Hyosung Chairman Cho and Indian P.M. Mori attended the inaugural Magnetic Maharashtra Convergence 2018 Exhibition. This event presents the direction of India's economic development and seeks to attract foreign investment in fields such as manufacturing, export-oriented industries, infrastructure development, smart city and IT. Cho, Tata Group Chairman Ratan Tata and Reliance Group Chairman Mukesh Ambani attended the opening session as well as Indian and global business leaders.
In his opening speech, Cho said, "The full support of the Indian government has helped Hyosung build a spandex plant in India, a longstanding hope of our company. The Pune-based manufacturer of high-voltage circuit breakers is also playing a strong role in building India’s power infrastructure. Hyosung looks forward to the future in India, where it' is taking the lead among global companies, and will grow into a corporation beloved by Indians."
In June last year, Hyosung participated in India’s first textile exhibition, Textile India, and set up the event’s single largest booth. There, Cho introduced Hyosung’s major textile products such as spandex, carpeting for cars, carbon fiber and aramid. Indian P.M. Modi also visited Hyosung’s booth, attracting keen attention.
Kim Su-a firstname.lastname@example.org
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