Bajaj May sales flat; entry-level segment sees traction

Below is the transcript of S Ravikumar’s interview with Reema Tendulkar & Sonia Shenoy on CNBC-TV18.

Sonia: Take us through how the month went not so much in terms of the numbers itself which we have but more in terms of the trend? Have you seen the trend improving both in domestic as well as in exports?

A: First, I should give you the details platform wise of this 3.45 lakh that you mentioned. The Platina platform for us domestic plus exports did 1.80 lakh units. Discover Platform did 38,000 units. The Pulsar KTM Platform did 83,000 units and three-wheelers did 44,000 units. That adds upto this 345 thousand. Now let me just get into more details about domestic, export etc.

First talking about domestic motorcycles, like you said it is similar to last year, 171 versus 176 we have just played it out even. Industry in motorcycles has been slightly negative within that we have just held on to our 170 plus type of numbers. That has been good as far as comparison to last year is concerned. Now let us look at the segment wise progression. The entry segment where we have played out our Platina and CT recently in the first quarter that is getting from strength to strength, this has accounted for almost about 90,000 units in the month of May, that is 58 percent better than last May 2014 when it reported a 57,000.

That is as you said less significant the trend is more important, the sequential growth is more important. So, in March in this segment we did 45,000 units. In April we did 80,000 and that time we said we are on going towards 100,000 units. In May we did 90,000 units so the market share which is around 24-25 percent came to 40 percent in the month of April and it is likely to get better in the month of May. Segment wise market share numbers are getting complied.

Sonia: What is the overall market share in the domestic motorcycle segment and how much has it gone up by?

A: In the overall market share we are at about 18 percent the details will be coming soon. We are holding on to this 18 percent from 15 we moved up to 18-18.50. However this is at a billing level and as you know in retail we have been very strict and disciplined. Retail our sense is that this may be about 100 basis points more than what I my telling you just now. Let me get back to the story of the entry segment which is where things have played out very nicely for us right from the month of, mid of February till now in this the CT has sold over 155 thousand units so entry segment we are as per plan.

Let us look at the S segment that is a sport segment, premium segment. In this we have launched the Pulsar RS and more recently AS200 and the AS150. Here we have done just in the month of May alone; these three variants added 11,000 units so my guess is that certainly the market share of ours which used to be always 43-44 percent should have certainly improved. Average per month in Q4 was 55,000 in this segment this has gone to about 59,000 units in domestic in this segment. So domestic top end and bottom end doing quite okay as we predicted in April also.

Sonia: You told us that the Platina has sold 1.8 lakh units. Is that correct?

A: Platina platform domestic plus exports – I was giving breakup of 3.45 lakh when I started first.

Sonia: Last month, if I am not wrong the Platina and CT – you had said that 80,000 units per month was your run rate?

A: That is domestic alone.

Sonia: So Platina plus CT domestic -- what was it this month?

A: 90,000 and it is going towards 1,00,000.

Reema: While your commercial vehicle sales have gone up nearly 13 percent on year-on-year basis, they have come down on a month on month basis. It had a run rate of about 50,000 units in April. It has come down to 43,500 units in the month of May. Can you walk us through the outlook as well as the run rate that you see in the CV segment?

A: Let me go through this in two parts because the number you see there is a combination of exports and domestic. Domestic, we are happy to say that we are continuing to maintain 55 percent market share in that and it is only a question of some permits opening up and how things pan out there in fact in petrol, compressed natural gas (CNG), liquefied petroleum gas (LPG) segment we have improved our market share and the total market share for passenger commercial vehicles, three-wheelers is at healthy 55 percent for April and May.

The export is a simple question of getting the LCs in place and things moving out but here also compared to last May we have improved our exports from 19,000 to 28,000; there is 48 percent growth.

Now let me talk about the export story. Last time when we talked I told you that in April we did 162 and May we should be doing another 160 plus and June we should be doing another 160 plus, so we are exactly there at about 159k in the month of May and we should be doing 160 plus in June. So from 355,000 Q4 we are well on our way to about half million in Q1 in exports in this quarter. So that is doing very well for us. Exports, all the markets are doing okay and by and large Nigeria, Egypt and everything is doing fine and Latin America has picked on very well to Pulsar 200NS and that is doing great there, so the story is unfolding as planned in exports.