Chennai, Sept. 7 Electronics manufacturing services (EMS) provider Nestronics India Pvt Ltd plans to invest about Rs 85 crore in setting up 12 assembly lines at its Chennai facility.

The expansion plan, extending over three years, also involves an addition of about 80,000 sq ft of manufacturing area to the company’s existing 20,000 sq ft, and ramping up headcount to 450 from the present 120.

Domestic operations

The company, a wholly owned subsidiary of Singapore-based Nestronics Ltd, assembles printed circuit boards and currently operates two lines, each capable of assembling about 80,000 components an hour.

A third line is expected to be operational in a few months. The facility makes products for the telecom tower equipment industry and has recently commenced pilot testing of medical equipment assembly.

“We plan to have 15 assembly lines in India by 2010 and will add 1-2 lines every quarter to reach this target,” said Mr P.N. Mathur, General Manager, Nestronics India. The expansion will be funded through external commercial borrowings and internal accruals.

Eventually, all manufacturing activity would be moved out of Nestronics’ Singapore facility (currently operating four lines) into India, including lines catering to biotechnology and oil and gas industries, he said.

“Manufacturing in India is about 40 per cent cheaper than in Singapore. In future, our Singapore facility will only be involved in prototype designing and testing,” he added. The global EMS market is valued at over $1 trillion (about Rs 40,00,000 crore) and is growing at 25-30 per cent annually, he said. “We also plan to offer box assembly services where complete products can be manufactured and sold to clients,” he said.