Company Overview
Founded in 1990 in Aurangabad by Tarang Jain, Varroc Engineering started as a polymer business and has organically and through acquisitions positioned itself as a leading global Tier-1 supplier of automotive components. Varroc’s international footprint increased as the company extended its offerings into lighting systems, electronics, and metallic products and acquired companies in Europe, Turkey, and most recently in Brazil. Varroc now has a strong global presence with 35 manufacturing sites, 11 engineering hubs in ten countries, and over 13,800 employees generating a revenue of $1.8 billion.
Key Challenges
The rapid expansion of Varroc although can be impacted by the following challenges to sustainable growth:
- Continuing declining profits and declining book value over the last two years.
- Stock performance has poor general performance, which raises concerns from investors.
- Increased costs incurred to adopt new technologies and upgrade the company supply chain.
- High risk of compensation in a product category that has excess global and local competition.
- Difficulty with compliance and regulations with operating in numerous countries.
Strategic Responses
Varroc provided a successful response to the challenges noted utilizing strategic action the following:
- Geographical partnerships and global acquisitions to expand its technological capability and enlarge its scale.
- Diversified product offering to limit dependence on a single market or segment.
- We have made substantial investments in R&D, with over 1,500 engineers focusing on innovation across electronics, lighting, and other mobility solutions.
- We have built our recognition and trust on a long track record of quality and have won awards from industry-leading OEMs.
- Electrics & vacancy lighting systems are some of the emerging opportunities we are targeting to maintain pace with the changing mobility landscape.
Results & Outlook
These initiatives have positioned Varroc as a viable contender in the global market today. The value of having a strong portfolio, a solid global supply chain, and a well-established innovation facilitates the business’s protection against competitive pressures and evolving regulatory requirements. Although profitability remains an opportunity for improvement, Varroc has created a foundation to capitalize on electric mobility as well as more advanced automotive systems based on its technology, quality, and trust.
Gireesh Sharma
Director, Manufacturing Industry