EMS (Electronics Manufacturing Services) is currently part of the company’s Customer Support Services division (CCS).
CCS currently accounts for about 30% of TVS’s revenues and balance 70% is contributed by Products and Solutions division (PAS).
- EMS currently is a very small contributor to TVS’s business (details not provided).
- Company wants to grow EMS as big as the PAS division.
- Strategy is to look at mid-volume, high complexity products that will provide high margins. Such products will cater to auto manufacturing, industrial engineering, telecom, pharma and green energy sectors.
- To help grow the EMS business, the Company will invest Rs 50-75 cr in expanding it’s single surface mount technology (SMT) lines. The SMT line is engaged in printed circuit board assembly (PCBA).
- EMS will help in increasing the margins and the ROCE
- EBIT is targeted to double from the current levels of 2-3%
- ROCE is targeted at 15% compared with 1% currently
Given Company’s history so far it’s difficult to predict how this will unfold and over what period.