In a significant development for the rail manufacturing sector, Titagarh Rail Systems (TRSL) and Amber Group have announced a strategic alliance, forming a Joint Venture (JV) or Special Purpose Vehicle (SPV) in both India and France. This collaboration underscores the commitment of Indian rolling stock firms to elevate their manufacturing capabilities.
As part of this venture, both Titagarh Rail Systems and Amber Group, through its wholly owned subsidiary Sidwal Refrigeration Industries Pvt Limited, will make substantial investments of approximately Rs 120 crores each, securing around 50% ownership in the SPV. These investments are earmarked for establishing a new railway component business and injecting fresh equity into Italy's Firema, a subsidiary of the Titagarh Group, with the aim of expanding operations into European markets.
The primary focus of the partnership involves setting up a rail vehicle manufacturing facility in India dedicated to producing critical railway components and subsystems essential for the manufacturing of Railway and Metro coaches. Additionally, the collaboration involves making new equity investments in Titagarh Firema SpA, Italy, an affiliate of the Titagarh Group.
Jasbir Singh of Amber expressed enthusiasm about the deal, stating, "This will be a game changer for Amber as not only will it give us a very strong foothold to make a customer base global, but it will also give us preferred access to the demands of one of the strongest and fast-emerging rolling stock manufacturers in the country." Singh highlighted the potential of the SPV to offer comprehensive integrated solutions to rolling stock manufacturers for railway subsystems both in India and overseas, substantially contributing to the Bill of Materials (BOM) of passenger coaches.
The alliance is poised to significantly expand the total addressable market for both Sidwal and the SPV. Singh emphasized leveraging this alliance for market and technology access to Europe and the global stage, marking the Amber Group's inaugural overseas venture into manufacturing and gaining valuable knowledge and experience to propel the company onto the global stage.
Moreover, the two groups are currently engaged in advanced discussions to secure technology for these components from global leaders, particularly those based in Europe. Although the specific components will be disclosed by the JVC-SPV in due course, they encompass critical elements such as coach interiors, coach toilets, kitchens, seats, and other important railway subsystems.
The joint venture aspires to capture a significant market share, aiming for at least 20% value or INR 150-200 lacs per passenger coach. The development of innovative components and subsystems fitted onto these coaches is expected to drive the achievement of this ambitious goal. The collaboration signifies a leap forward in enhancing India's capabilities in the rail manufacturing sector, establishing a robust foundation for future growth and global competitiveness.