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  • 8/4/2019 Automobile Industry Outlook

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    Automobile Industry:

    Industry Overview:

    Automobile Overview:

    The Indian auto industry, worth US$ 34 billion in 2006, has grown at a CAGR of 14 per cent over the lastfive years with total sales of vehicles reaching around 9 million vehicles in 2005-06. That number islikely to see a significant boost, given that the first half of 2006-07 has already witnessed a staggeringgrowth rate of 17.12 per cent. Domestic car sales for the April-September 2006 period stood at animpressive 4.86 million vehicles, including cars, two-wheelers and commercial vehicles. According toindustry experts, if this trend continues, sales could touch 10 million by March 2007, clocking an annualgrowth rate of 20 per cent. In addition, the Governments announcement to cut excise duty on small carswill soon see India emerging as the world's largest manufacturing hub for small or compact cars.

    Destination India:

    India is on every major global automobile players roadmap, and it isnt hard to see why:

    India is the second largest two-wheeler market in the world. Fourth largest commercial vehicle market in the world.

    11th largest passenger car market in the world.

    Expected to be the seventh largest by 2016.

    Robust production

    Indias car production capacity is in for a US$ 2 billion boost. Auto majors have announced massiveinvestment plans which will push the countrys car production past the psychological 2 million mark by theend of fiscal 2006-07, up 70 per cent from 1.4 million units now. Even at 2 million, India, which stood atNo.11 among global car producing nations, will move two steps ahead, past UK (1.6 million) and Canada(1.35 million). It will be neck and neck with Brazils 2-million capacities at No.8.

    The automobile industry witnessed a growth of 19.35 percent in April-July 2006 when compared to April-July 2005, as is evident from this years production trends.

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    Automobile Production Trends

    Category 2004-05 2005-06 (In no.s)

    M&HCVs 214807 219297

    LCVs 138896 171781

    Total CVs 353703 391078

    Passenger Cars 960487 1045881

    Utility Vehicles 182018 196371

    MPVs 67371 66661

    Total Passenger vehicles 1209876 1308913

    Scooters 987498 1020013

    Motorcycles 5193894 6201214

    Mopeds 348437 379574

    Total Two Wheelers 6529829 7600801

    Three Wheelers 374445 434424

    Grand Total 8467853 9735216

    Source: Society of Indian Automobile Manufacturers (SIAM)

    Domestic Sales:

    Increased affluence, wider selection and the ready availability of car loans is driving the Indian car marketthrough the roof. During the last five years (2000-05), the production of passenger cars in India increasedby more than 100 per cent. India achieved the sales of 1.11 million vehicles last year (2005).

    Domestic sales have been growing at a clipping pace:

    Passenger car sales rose by 22.84 per cent during April-September 2006, compared to the

    corresponding period last year. The cumulative growth of overall sales of passenger vehicles during April-September of 2006-07

    was 20.73 percent. Utility Vehicle (UVs) sales grew at 12.85 per cent during the same period. Overall, the two wheeler market grew by 15.49 per cent during the April-September period

    of financial year 2006-07, over the same period last year.

    Motorcycles grew by 18.53 per cent, scooters at 0.12 percent and mopeds at about 6.53percent over April-September 2005.

    Three wheeler sales grew at 19.90 per cent. Goods carriers grew by 26.16 per cent andpassenger carriers grew at 15.78 per cent during the April-September 2006 period, over the sameperiod last year.

    Overall, the commercial vehicles segment grew at 36.96 per cent. Growth of Medium and HeavyCommercial Vehicles was 39.92 per cent. Light Commercial Vehicles also performed well with a

    growth of 32.86 percent.

    Automobile Domestic Sales Trend

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    Category 2004-05 2005-06 (In Nos.)

    M&HCVs 198506 207446

    LCVs 119924 143237

    Total CVs 318430 350683

    Passenger Cars 820179 882094

    Utility Vehicles 176360 194577

    MPVs 65033 66366

    Total Passenger Vehicles 1061572 1143037

    Scooters 922428 908159

    Motorcycles 4964753 5815417

    Mopeds 322584 332741

    Total Two Wheelers 6209765 7056317

    Three Wheelers 307862 360187

    Grand Total 7897629 8910224

    Source: Society of Indian Automobile Manufacturers (SIAM)

    Exports:

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    Overall automobile Exports registered 28.13 percent growth rate in April-August 2006 over the sameperiod last year. Passenger Vehicles Exports grew at 14 percent. Two Wheelers Exports grew by28.80 percent and Commercial Vehicles by 28.36 percent.

    Automobile Export Trends:

    Category 2004-05 2005-06 (In Nos.)

    M&HCVs 13474 14096

    LCVs 16466 26485

    Total CVs 29940 40581

    Passenger Cars 160670 170193

    Utility Vehicles 4505 4486

    MPVs 1227 1093

    166402 175772

    Scooters 60699 83873

    Motorcycles 277123 386202Mopeds 28585 43181

    Total Two Wheelers 366407 513256

    Three Wheelers 66795 76885

    Grand Total 629544 806494

    Investments:

    The Indian automobile sector has witnessed a slew of investments in the first half of 2006, dominated byplans for new plants and ramped up capacities. Here are some of the vehicle manufacturers dominatingthe headlines with their impressive plans:

    Punjab-based International Cars and Motors (ICML) will invest US$ 223.7 million in HimachalPradesh to set up a plant to manufacture diesel-operated multi utility vehicles (MUVs).

    Nissan is set to establish its manufacturing base in Gujarat. The company, along with Suzuki, isplanning to invest upto US$ 671.2 million for a 600,000 cars per annum plant.

    Toyota Kirloskar Motors is likely to set up its second plant near its existing facility in Bidadi,Karnataka.

    Hyundai Motor is set to invest an additional US$ 700 million into its Indian operations based inTamil Nadu, to expand the companys passenger car capacity to 600,000 units per annum fromthe present 300,000, as well as in a new engine and transmission unit.

    The Government is planning to set up three dedicated corridors for automobile companies exporting to

    the rest of the world. Dedicated rail corridors are proposed between Gurgaon and Mumbai port, Pune and

    Mumbai including JNPT and Jamshedpur and Kolkata. A dedicated highway for automobile movement is

    also being considered between Gurgaon and Delhi. The proposal also includes creating the last-mile,

    road-port connectivity at all the four ports.

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    Investment Opportunity:

    Establishing Research and Development Centres

    Establishing Engineering Centres

    Passenger Car Segment

    Two Wheeler Segment

    Heavy truck Segment

    Foreign players in India:

    Calendar 2006 has seen the entry of many high-end brands into the country. The Indian automobilemarket will see at least 30 new launches, spanning everything from affordable hatchbacks to mid-sizemodels to super luxury high-end cars and SUVs.

    Mercedes, BMW, Porsche, Audi, Bentley and Rolls Royce are already here. Now, the Italian

    marquee Lamborghini is also planning to enter the country. The Italian marquee plans to launchthe Gallardo.

    German luxury car maker Audi AG is preparing to drive into India a range of sporty, lifestyle carslike S8 and RS4 early next year. The year 2007 will also mark Audi's entry into merchandising inIndian car bazaar.

    General Motors launched Aveo this year. GM plans to bring in a sporty variant of the Chevy Optrato add to its existing line-up.

    Advantage India:

    India holds huge potential in the automobile sector including the automobile component sector owingto its technological, cost and manpower advantage. Further, India has a well-developed, globallycompetitive Auto Ancillary Industry and established automobile testing and R&D centres. The country

    enjoys natural advantage and is among the lowest cost producers of steel in the world. The Indianautomobile industry today boasts of being the Second largest two Wheelers manufacturers in theworld, World largest Motorcycle manufacturer is in India, Second Largest tractor manufacturer in theworld, Fifth largest commercial vehicle manufacturer in the world and Fourth largest Car market inAsia.

    TWO WEELER INDUSTRIES:

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    Riding on TopGear is what our two-wheeler update said for the first half of FY05,wherein the industry volumes had grown over 12% on back of good monsoons. Ifthat was anything to be happy about, the second half of FY05 has given the industryreasons to celebrate, with strong volume rise of nearly 16% (Apr-Feb) inmotorcycles, largely aided by faster growth in the entry level 100 cc segment.

    Though competition has been on the rise in the past year, with new models and

    variants being launched every alternate day, the overall market has been growingfast enough to accommodate all of these models.

    The most striking feature of the year gone by was the growing volumes in favour ofthe entry-level segment. Industry leaders Hero Honda and Bajaj Auto have onceagain kept the other players at bay, and increased their market share during theyear. Infact, Bajaj Auto has been outperforming the industry by a good margin forthe last few months, courtesy its new launches CT100 and the Discover. TVS Motoron the other hand has been reeling under pressure since the time its Max 100 salesstarted dipping at the end of FY04 while the new models are yet to taste success inthe market. Apart from the big three, the talk of the town in the past year was theentry of Honda Motors into the Indian motorcycle segment through its Unicorn.

    Launched in the premium 150 cc category, the bike received spectacular responseinitially with a waiting period of almost 6 weeks.

    Despite the strong volume growth witnessed by the industry, profits have grown ata slower rate or even de-grown in some cases due to the cost pressures and highersales of economy bikes. Due to growing competition, manufacturers resistedpassing on price hikes and instead took a hit on their profits. However, recently thecompanies have raised prices on most of their models by around 1-3%.

    Hero Honda

    The leader has created another landmark by crossing 2.5 million bikes for the yearand in the process improving its market share in motorcycles to 50% from 48% inlast year. For FY05, Hero Hondas sales stood at 2.6 million, a rise of over 27% overthe last years 2.1 million. Domestic sales were up 26%, while export sales, whichforms a miniscule part of the overall sales were up 63%. Sales continued to beheavily stacked in favour of the Splendor Plus and Passion Plus models,accounting for over 70% of total volumes.

    Vehicle Sales Q4FY05 Q4FY04 % Chg FY05 FY04 % ChgTotalMotorcycles 685419 592718 15.6% 2626070 2070154 26.9%Domestic 664845 578477 14.9% 2562003 2030899 26.2%Exports 20574 11492 79.0% 64067 39255 63.2%

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    The company would have done a lot more had it not been for the capacityconstraints they were facing for the second half of the year. What was even moreheartening was the fact that just once in the twelve months did the sales droppedbelow 2-lakh mark. For the second half of FY05, the companys sales hoveredaround 2.3 lakh a month with no spare capacity to cater to the additional demand.

    One prime reason for the strong sales by Hero Honda during the second half werethe promotion schemes and discounts on most of the models. The company offereda discount of Rs 1000 per bike for most part of the second half, while during Diwalithe customer was given a Reliance mobile handset free along with the bike, whichhelped to create excitement and boosted the sales. Further, prices of models likeKarizma and Ambition were reduced to generate additional demand.

    Towards the end of the fiscal, Hero Honda unveiled its new offering Super

    Splendor in the growing 125 cc class, and costing around Rs 2000-3000 more thanthe Splendor plus model. The model has nothing new to offer as far as externalfeatures are concerned; however considering the strong growth opportunities of125 cc segment and Hero Hondas strong brand equity, the model is expected toclock decent numbers.

    Going forward, for the year FY06, Hero Honda is expected to continue performingwell and improve sales through de-bottlenecking of its plants, which will increasethe capacity by over two-lakh units. The new Super splendor is hopeful of clockingsales of nearly 30,000 units, largely cannibalizing the sales of previous splendor andpassion models, due to its powerful engine and good fuel economy.

    Bajaj Auto:

    Strong growth in the motorcycle segment saved the day for Bajaj Auto, while theother segments de-grew during the year. The company sold a total of 1.8 millionvehicles (incl. 3-wheelers), higher by 20% as compared to last year. Motorcyclessales grew 42% to 1.45 million, outperforming the industry hands down and in theprocess increasing its market share to 28.8% as against last years 24.5%.

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    FY04VehicleSales

    Q4FY05 Q4FY04 % Chg FY05 % Chg

    Scooters(G) 20418 49523 -58.8% 102762 178070 -42.3%Scooters (UG) 4818 12039 -60.0% 30931 54709 -43.5%Step thru's 4391 8487 -48.3% 19195 32502 -40.9%Motorcycles 396107 262992 50.6% 1449677 1023650 41.6%Total 2wheelers 425734 333070 27.8% 1602565 1288960 24.3%3 Wheelers 53725 60409 -11.1% 221987 229154 -3.1%Grand Total 479459 393479 21.9% 1824552 1518114 20.2%

    Motorcycle growth was led by the new CT100 model in the entry segment, whichclocked sales of almost lakh units a month in just a few months from its launch.Launched in May last year, the bike was an instant hit with the commuters due to itslow price, high fuel efficiency and smart looks for an entry level bike. The bikesucceeded in acquiring the leadership position in the entry segment from HeroHondas CD Dawn and even posed a challenge to the might of Splendor.

    Later in the year, Bajaj launched the much-awaited Discover in the 125 cc executivesegment. The bike received great reviews due to its superior technology and suavelooks and is contemplated to be the biggest contender to Splendors title in comingyears. The Discover model is clocking around 25,000 units per month currently andcommands nearly 40% of the 125 cc segment sales. Apart from these newlaunches, Bajaj continued its dominance in the premium segment, courtesy thePulsar twins, and firmly stood its ground against the Hondas new entrant Unicorn,

    which was expected to affect Pulsar sales. The unexpectedly strong salesperformance has forced the company to increase capacities of motorcycles from 1.8million to 2.4 million for the year.

    Step-thru and scooter sales (both geared and ungeared) continued to witness aslump in sales, down by over 40% for the year, with continued shift in preferencetowards the motorcycles. Three wheeler volumes too have been lower by 3% overlast year due to growing competition in the segment from domestic as well as

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    international players. Though three-wheeler sales were down just about 3% for theentire year, the major brunt was borne during the second half, wherein the salesslipped by 17%.

    2WEALTHS

    In the coming year, Bajaj is contemplating launching of two new bike models byJune, one each in entry and premium segments. In the premium segment, themarket is anticipating Pulsar 200 cc model while the entry-level bike is likely to be astripped down version of CT100, with a price tag of less than Rs 30,000. Meanwhile,Discover, due to its superior features should attract greater number of buyers. Also,the newly launched scooter Bajaj Wave is banking on niche segments and thecompany has great expectations from this model. The company will continue tofollow an aggressive pricing policy in search of market share.

    TVS Motors:

    TVS Motors has been a laggard as regards FY05 was concerned and hasdisappointed a great deal of its supporters. Overall sales for the year grew justunder 2% to 1.16 million, while the motorcycle sales ended the year 4% lower to 6.8lakh bikes.

    VehicleSales

    Q4FY05 Q4FY04 % Chg FY05 FY04 % Chg

    Motorcycles 176921 181420 -2.5% 679536 706558 -3.8%Scooters 48759 44471 9.6% 224621 189238 18.7%Mopeds 71025 69358 2.4% 263393 251065 4.9%Total Sales 296705 295249 0.5% 1167550 1146861 1.8%

    Second half of FY05 was however much better, assisted by the launch of Star 100cc. Scooter sales were up 19% for the year, aided by strong growth in sales ofScooty model and managed to control some on the damage done by faltering bike

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    sales. For the year, the companys market share in the two wheelers has fallen bynearly 270 bps to 18.7%.

    In the motorcycle division, TVS has lost significant market share due to sharp fall insales of entry-level bike Max 100, with no other model from the TVS stable filling inthe gap until the launch of Star in mid November. The company launched the 125cc Victor GLX in Sept to capitalize on the immense growth prospects of thissegment. The bike has met with moderate success due to heightened competitionin the segment and sells close to 15,000 units.

    TVS has lined up big-ticket expansion of over Rs 400 crore in the next few yearswhich includes a two wheeler plant in Indonesia to strengthen its international

    presence. The Indonesian plant will have an initial annual capacity of 1.2 lakh units,while another two wheeler plant will be setup in India to enhance the localpresence.

    In the coming year, TVS plans to introduce three new models to provide the much-needed spurt to the volumes, apart from relying on consistently performing Victorand Star models. Scooty Pep 100 cc version will be launched in second or third

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    quarter of FY06, while the new Fiero premium model is also expected sometime inthe early 2006 to replace the current Fiero model.

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    HERO HONDA:

    Hero Honda Motors Limited was established in 1984, as a joint venturebetween India's Hero Group (world's largest bicycle manufacturers) andJapan's Honda Motor Company. In 1985 production began with the launch

    of its first motorcycle, the CD100, which gave 80 km to the liter. In 1987the engine plant was started and in 1989 the Company produced its3,00,000th motorcycle. In 2001 Hero Honda manufactured its50,00,000th motorbike. Hero Honda has a reputation of being the mostfuel-efficient and the world's single largest two wheeler Company. ShriBrijmohan Lall Munjal is the chairman and managing director of thisCompany. Both the manufacturing plants are located in Haryana, one atDharuhera (district Rewari) and the other in Gurgaon.

    In a little over two decades, the world's largest manufacturer of bicycles and the global leader inmotorcycles have created not only the world's single largest motorcycle company but alsothe most endearing and successful joint venture for Honda Motor Company worldwide. Thecompany has sold over 15 million motorcycles and has consistently grown at double digits sinceits inception and today, every second motorcycle sold in the country is a Hero Honda.

    The Gurgaon plant is situated on the Delhi-Jaipur Highway, in Sector 33.The Dharuhera plant, set up in 1987 in the Dharuhera Industrial Area, isspread over an area of 140 acres. The Dharuhera plant manufacturesCD100, CD100ss and CD Dawn motorcycles while the Gurgaon plantmanufactures the other models. Splendor is manufactured at both theplants. With both these plants running at full capacity, Hero Honda arelooking for a suitable location to set up their third manufacturing unit.

    In this period, Hero Honda has set up over 2400 customer touch points, comprising a mix of dealers,

    service centres and stockists across rural and urban India. Today, Hero Honda is an amalgam of

    winning networks and relationships with internal and external stakeholders, including Investors,

    Dealers, Vendors and Employees. These relationships have helped the company hold on to the mantle

    of World No.1 for years in succession.

    What makes Hero Honda well, Hero Honda, is synergy. The two partners, leaders in their respective

    domains, have been able to consistently draw on each other's strengths. The Hero Group's deep

    domain knowledge of the Indian market and its supplier network has meshed with Honda's mastery

    over four-stroke engine technology to create modern and fuel-efficient machines at affordable pricesfor India 's 250-300 million strong middle class.

    Hero Honda was also one of India 's first automotive companies to get close to the customer. Over the

    years, feedback has flowed back and forth seamlessly through a unique CRM program - the Hero

    Honda Passport Program which now has over 2.5 million members on its roster. The program has

    not only helped Hero Honda understand its customers and deliver value at different price points, but

    has also created a loyal community of brand ambassadors.

    http://www.haryana-online.com/http://www.haryana-online.com/Districts/rewari.htmhttp://www.haryana-online.com/Districts/gurgaon.htmhttp://www.haryana-online.com/delhi.htmhttp://www.haryana-online.com/http://www.haryana-online.com/Districts/rewari.htmhttp://www.haryana-online.com/Districts/gurgaon.htmhttp://www.haryana-online.com/delhi.htm
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    It isn't surprising that the company is in no mood to take its hand off the throttle. As Brijmohan Lall

    Munjal, the Chairman, Hero Honda Motors succinctly puts it, "We pioneered India's motorcycle

    industry, and it's our responsibility now to take the industry to the next level. We'll do all it

    takes to reach there.''

    HERO HONDA'S MISSIONHero Hondas mission is to strive for synergy between technology,

    systems and human resources, to produce products and services

    that meet the quality, performance and price aspirations of its

    customers. At the same time maintain the highest standards of

    ethics and social responsibilities.

    This mission is what drives Hero Honda to new heights in

    excellence and helps the organization forge a unique and

    mutually beneficial relationship with all its stake holders.

    KEY POLICIESAN ENVIRONMENTALLY AND SOCIALLY, AWARE COMPANYAt Hero Honda, our goal is not only to sell you a bike, but also to help you every step of

    the way in making your world a better place to live in. Besides its will to provide a high-

    quality service to all of its customers, Hero Honda takes a stand as a socially responsible

    enterprise respectful of its environment and respectful of the important issues.

    Hero Honda has been strongly committed not only to environmental conservation

    programmes but also expresses the increasingly inseparable balance between the

    economic concerns and the environmental and social issues faced by a business. A

    business must not grow at the expense of mankind and man's future but rather must

    serve mankind.

    "We must do something for the community from whose land we generate our wealth."

    A famous quote from our Worth Chairman Mr.Brijmohan Lall Munjal.

    Environment PolicyWe at Hero Honda are committed to demonstrate excellence in our environmental

    performance on a continual basis, as an intrinsic element of our corporate philosophy.

    To achieve this we commit ourselves to:

    Integrate environmental attributes and cleaner production in all our business

    processes and practices with specific consideration to substitution of hazardous

    chemicals, where viable and strengthen the greening of supply chain.

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    Continue product innovations to improve environmental compatibility.

    Comply with all applicable environmental legislation and also controlling our

    environmental discharges through the principles of "alara" (as low as reasonably

    achievable).

    Institutionalise resource conservation, in particular, in the areas of oil, water,

    electrical energy, paints and chemicals.

    Enhance environmental awareness of our employees and dealers / vendors, while

    promoting their involvement in ensuring sound environmental management.

    Quality PolicyExcellence in quality is the core value of Hero Honda's philosophy.

    We are committed at all levels to achieve high quality in whatever we do, particularly in

    our products and services which will meet and exceed customer's growing aspirations

    through:

    Innovation in products, processes and services.

    Continuous improvement in our total quality management systems.

    Teamwork and responsibility.

    Safety PolicyHero Honda is committed to safety and health of its employees and other persons who

    may be affected by its operations. We believe that the safe work practices lead to betterbusiness performance, motivated workforce and higher productivity.

    We shall create a safety culture in the organization by:

    Integrating safety and health matters in all our activities.

    Ensuring compliance with all applicable legislative requirements.

    Empowering employees to ensure safety in their respective work places.

    Promoting safety and health awareness amongst employees, suppliers and

    contractors.

    Continuous improvements in safety performance through precautions besides

    participation and training of employees.

    Prize Tag for Hero Honda Bikes:

    (MAKE CHART)

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    Pleasure - Scooter with 102 cc air-cooled four-stroke engine Price: Rs36,240 Delhi ex-showroom Karizma - Motorbike with 223 cc four-stroke air-cooled engine Price:Rs 79,000 Delhi ex-showroom Super Splendor - Motorcycle with 125 cc four-stroke air cooled

    engine Splendor + - Motorbike with 97 cc four stroke air cooled engine Price:Rs 40,579 Delhi ex-showroom Glamour - Motorbike with 125 cc (9 bhp) "quantum core" engine Passion + - Motorbike with 97 cc four stroke air-cooled engine Price:Rs 41,885 Delhi ex-showroom CD Deluxe - Motorbike with 97 cc four-stroke air cooled engine Price:Rs 53,779 Delhi ex-showroom CD 100 SS - Motorbike with 97 cc four-stroke air-cooled engine PriceRs 38,821 Delhi ex-showroom CD Dawn - Motorcycle with 97 cc four-stroke air-cooled engine Price:

    Rs 31,899 Delhi ex-showroom Achiever - Motorcycle with 149 cc four-stroke air-cooled engine Price:Rs 48,200 Delhi ex-showroom

    BOARD OF DIRECTORS :

    No

    .

    Name of the Directors Designation

    1 Mr. Brijmohan Lall Munjal Chairman & Whole-time Director

    2 Mr. Pawan Munjal Managing Director

    3 Mr. Toshiaki Nakagawa Jt. Managing Director

    4 Mr. Takao Eguchi Whole-time Director

    5 Mr. Satyanand Munjal Non-executive Director

    6 Mr. Om Prakash Munjal Non-executive Director

    7 Mr. Tatsuhiro Oyama Non-executive Director

    8 Mr. Masahiro Takedagawa Non-executive Director

    9 Mr. Narinder Nath Vohra Non-executive & Independent Director

    10 Mr. Pradeep Dinodia Non-executive & Independent Director

    http://www.herohonda.com/co_board_directors.htm#1http://www.herohonda.com/co_board_directors.htm#2http://www.herohonda.com/co_board_directors.htm#3http://www.herohonda.com/co_board_directors.htm#4http://www.herohonda.com/co_board_directors.htm#5http://www.herohonda.com/co_board_directors.htm#6http://www.herohonda.com/co_board_directors.htm#7http://www.herohonda.com/co_board_directors.htm#8http://www.herohonda.com/co_board_directors.htm#9http://www.herohonda.com/co_board_directors.htm#10http://www.herohonda.com/co_board_directors.htm#1http://www.herohonda.com/co_board_directors.htm#2http://www.herohonda.com/co_board_directors.htm#3http://www.herohonda.com/co_board_directors.htm#4http://www.herohonda.com/co_board_directors.htm#5http://www.herohonda.com/co_board_directors.htm#6http://www.herohonda.com/co_board_directors.htm#7http://www.herohonda.com/co_board_directors.htm#8http://www.herohonda.com/co_board_directors.htm#9http://www.herohonda.com/co_board_directors.htm#10
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    11 Gen.(Retd.) Ved Prakash Malik Non-executive & Independent Director

    12 Mr. Analjit Singh Non-executive & Independent Director

    13 Dr. Pritam Singh Non-executive & Independent Director

    14 Ms. Shobhana Bhartia Non-executive & Independent Director

    15 Dr. Vijay Laxman Kelkar Non-executive & Independent Director

    16 Mr. Sunil Bharti Mittal Non-executive & Independent Director

    COMPANY PERFORMANCEHero Honda maintained its grip in the motorcycle segment with a lead ofmore than one million motorcycles over its competitor and a market share of

    48 per cent. Overall, your Company accounted for 40 per cent of the Indiantwo-wheeler market.

    Total sales grew by 17.4 per cent to Rs. 8,714 crores in 2005-06. Similarly,

    operating profits rose by 16.2 per cent to Rs 1,256 crores while post-tax profit grew

    by 19.8 per cent to Rs. 971 crores. Your Company in aggregate sold a little over 3

    million units in 2005-06 compared to 2.62 million units in the previous year, a

    growth of 14.5 per cent. The best-selling Splendor family doubled sales from

    600,000 to 1.2 million

    PRODUCT LAUNCHESFor more than two decades, Hero Honda created brand equity for itself byputting together best-in-class portfolios and new technologies. YourCompany also launched new engine platforms in 125cc and 150cccategories, and is planning several new launches in the forthcoming year.We've already introduced cutting-edge Fuel Injection technology in one ofour products, Glamour FI, making Hero Honda the first two-wheeler Companyin India to do so. Over time, we expect to cascade this technology acrossother models.

    Apart from successfully launching of 4 new models during the year in review,

    your Company made its debut in the scooter market with the 100cc offeringcalled Pleasure targeting women commuters and home makers. Theproducts, which are mostly sold through a chain of unique all-women retailoutlets, were received well by the market, and we hope to gain critical massover the next few years.

    http://www.herohonda.com/co_board_directors.htm#11http://www.herohonda.com/co_board_directors.htm#12http://www.herohonda.com/co_board_directors.htm#13http://www.herohonda.com/co_board_directors.htm#14http://www.herohonda.com/co_board_directors.htm#15http://www.herohonda.com/co_board_directors.htm#16http://www.herohonda.com/co_board_directors.htm#11http://www.herohonda.com/co_board_directors.htm#12http://www.herohonda.com/co_board_directors.htm#13http://www.herohonda.com/co_board_directors.htm#14http://www.herohonda.com/co_board_directors.htm#15http://www.herohonda.com/co_board_directors.htm#16
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    THIRD PLANTHero Honda has been regularly augmenting capacities to keep pace withgrowing market demand. During the year substantive expansion have takenplace in both the plants raising the capacity to manufacture close to fourmillion units per year. We have now started work on a Greenfield plant near

    the holy city of Haridwar in the state of Uttranchal. Through this globallydesigned plant, we will set new manufacturing practices in terms of cost andsupply chain management. We would also benefit from a slew of fiscalincentives offered to us by the Central and State Government.

    We expect these initiatives and incentives to yield tangible benefits in thecoming few years, and provide important growth and efficiency lessons forthe future.

    Financial at a Glance:

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    EXTRA BY HERO HONDA:

    CAMPUS ROCK IDOLS

    Tour of 2005Finale in Goa - "Rasmus" Concerts in Bangalore and Mumbai

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    In December campuses around 11 cities were scorching with the variousrounds of the Hero Honda and Pepsi Campus Rock Idols underway at thedifferent centres. The amateur college bands took up the challenge and wereprovided the stage and technical support to perform their best.

    Hero Honda Glamour, Achiever, and Karizma were typically on display at thecompetition venues. The idea was to unleash the aspirations of the youthand herald the emergence of new Idols, and the Scandinavian band "TheRasmus" who associated with this year's Campus Rock Idols - Tour of 2005epitomised the concept quite well.

    HERO HONDA SA RE GA MA PA :

    Hero Honda Sa re Ga Ma Pa Challenge 2005 is a reality show that promisesto go beyond just the participants. It is a contest between the four Mentorsthemselves! The epitomes of the music industry and the four mentors -Adesh Shrivastav, Jatin-Lalit, Himesh Reshammiya and Ismail Darbar willcome together only to battle against one another in a bid to make their teamwin the title of the Hero Honda Sa Re Ga Ma Pa Challenge 2005.

    HERO HONDA STAR SCREEN AWARD

    Screen Award was instituted in 1994 by Screen Weekly. The Screen Awardsare different from other "popularity" awards; the entire nomination andselection for the Screen Awards is done by a panel of distinguishedprofessionals from the industry itself, in a manner similar to that of theOscars. And the criterion for winning is professional excellence, not justpopular view. A Screen Award is thus considered the toughest award to winand is therefore most coveted award in the industry.

    The Awards for Hindi/Marathi films and TV and Non-film Music are presentedannually at a glittering function in January each year, at the Andheri Sports

    Complex, Mumbai. Seven editions of the awards have thus far beenpresented.

    Nominations for the 12th Star Screen Awards have been announced. The awards,

    scheduled for 11 January, will rank the best of Bollywood in 26 categories,

    telecasted on Star Plus on 15 January

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    HERO HONDA INDIAN TELEVISION ACADEMY AWARDS

    TV Stars set the stage on fire at the 5th HHITA Awards 2005

    The TV industry has indeed mushroomed giving the viewers a wider choice offare. Perhaps the fact they have been able to hold their audiences is best

    borne out by the rise in popularity of Plasma and Super-Flat TV sets, ashomes try to make the best of their viewing experience.

    Soaps, Comedies, Telefilms, Documentaries, Musicals, News & CurrentAffairs, Lifestyle-shows, you name it, it was represented in the fifth HeroHonda Indian Television Academy (HHITA) Awards 2005 held onMonday, 7th November 2005 at Bhavan's Ground, Andheri, Mumbai. Thiswell-publicised recognition of quality on the small screen serves as avaluable benchmark for the respective category of programming in the TVindustry.

    As many as 46 channels were in the fray for the coveted HHITA awards this

    year. 2017 nominations were received from 340 TV shows, thus representingthe entire spectrum of Indian television. Little surprise then that thetelevision industry's luminaries and the film industry's noted dignitariesattended the event.

    The stars of the television industry set the stage on fire with a wide range ofthunderous performances for the live audience. There was a dance numberperformed by Rohit & Ronit Roy along with Shweta Tiwari on the hit song"Kajra Re" from Bunty aur Babli. This was followed by mujra numbers fromfilms like Mughal-e-Azam, Devdas, Muqaddar Ka Sikandar performed bysizzling actresses Urvashi Dholakia, Nausheen Ali Sardar and ShamaSikander. The on-screen magic of Hussain and Juhi Parmar was showcased as

    they swayed to romantic duets, after which star pairs including Iqbal Khan-Neha Bamb, Vikas Bhalla-Mona Singh, Ajay Gehi-Mona Vasu performed to acollection of rain dance numbers.