Calcutta, Jan. 25: Exide Industries, the car battery maker, expects its insurance venture ' which till recently had Dutch major ING as partner ' to turn around by the end of the current fiscal.
"ING Vysya Life's performance has improved. We are expecting the insurance business to break even this year," said T.V. Ramanathan, managing director of Exide Industries.
ING Vysya Life registered a loss of Rs 16.9 crore from April to September 2012 against a loss of Rs 43 crore over the same period a year ago.
Exide, which has a 50 per cent stake worth Rs 744.4 crore in ING Vysya Life Insurance, recently announced its plans to acquire the entire business from the ING Group and two other private finance firms for Rs 550 crore.
The company expects clearance from the Insurance Regulatory and Development Authority within 3-4 months following which it would look for a new ally.
Though insurance is not related to Exide's core business of manufacturing lead acid batteries, according to Ramanathan, it can offer growth opportunities to the company.
"The life insurance business is still evolving and there is scope for growth in a country where many are still either under-insured or not insured at all. The focus of the central government on this sector gives considerable growth opportunities," Ramanathan said.
"Till the time we can find a suitable partner, the insurance business will continue under the ING brand," he added.
The company is also ready to invest in the insurance venture till it finds a new partner.
"If they (insurance business) require more money, we would support them," Ramanathan said.
According to industry observers, the new partner will infuse fresh equity for future expansion. But the need to make further investments in insurance till a new partner is found can be a drag on the cash flow of Exide.
Ramanathan gave no indication on when a new partner would join and said money would not be a problem.
Exide has around Rs 3,000 crore of reserves and surplus as on March 31, 2012.