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Motorcycle biz may grow by 40% in 2nd half of FY17: Bajaj Auto

In an interview with CNBC-TV18, S Ravikumar of Bajaj Auto said that the company is growing at double the industry rate in the domestic segment and expects 40 percent growth in motorcycle segment in the second half of this fiscal.

August 02, 2016 / 13:52 IST
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Bajaj Auto reported a dip in its July sales where total sales were down 0.1 percent to 3.29 lakh units year-on-year (YoY) and exports fell 20 percent to 1.31 lakh units (YoY).

In an interview with CNBC-TV18, S Ravikumar of Bajaj Auto said that the company is growing at double the industry rate in the domestic segment and expects 40 percent growth in motorcycle segment in the second half of this fiscal.

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He said that Bajaj has a market share of 20 percent in the domestic motorcycle segment and sees a monthly run rate of 2.2 lakh units for the same.Below is the verbatim transcript of S Ravikumar’s interview to Sonia Shenoy and Latha Venkatesh on CNBC-TV18.Latha: The year on year (YoY) is showing weakness, but month on month (MoM) are you spotting better trends in the domestic and export markets?A: Let us talk about those three major segments, the domestic motorcycles, the commercial vehicle (CV) domestic and then the exports. Domestic motorcycles we have posted a very strong growth of 21 percent in this month while the industry growth rate is at about half of that. So, already we are at a 20 percent type of a market share based on the current portfolio. What I want to take you to is the plan for the year especially in the months to come.In all the three segments in the sports, the mid segment and the entry segment, we are already at 20 percent on the strength of the current product portfolio. Very strong action is planned in each of these segments coming forward.Now we already told you that in this quarter itself in the sport segment, we are going to launch the Pulsar 400, which is all new fantastic Pulsar. It is going to be a very strong growth engine for us. We also talked last time just after the annual general meeting (AGM) about the second model from the successful V-platform that is going to hit the market in Q3. So, the mid segment is going to have the benefit of the second model from this platform.We are planning another strong launch in the entry segment also coming in Q3. So, there is going to be solid action in the next months in all the three segments. So, in H2 apart from the existing strong platform already -- with these three launches we are going to be firing on all cylinders.Last year, in H2 we averaged about 155,000 units a month. Currently, we are looking at something like 40 percent growth. That is about 215,000-220,000 units in H2 based on all the actions that I have explained to you.Now, let me come to domestic CV. In CV, basically two parts, petrol and alternate fuel, always 90 percent growth, there is nothing much to talk about there. That is going on as usual. Now, in the diesel segment while the industry year-to-date (YTD) in this four months has grown by five percent we have posted a 35 percent growth and we have come very close to the market leader, we are at about 35 percent market share in the diesel and that is also going on quite well.Let us come to exports. In exports, in April it was about 103,000 units. In the last three months we did 400,000 units.Sonia: Just wanted to come back to the important numbers in the domestic motorcycle market because you did mention that you have a couple of new launches lined up and also a new launch in the entry segment. For the past six months your domestic motorcycle runrate per month has been between 1.9 to 2.3 lakh units at best. Over the next six months what will the average monthly run rate be?A: That is what I already told you. For example I made a comparison between the half year last year and half year going to be in the H2 in the current fiscal. Last half year we did a run rate of about 155,000 units per month domestic motorcycles. We are looking at something like 220,000 units, that is about 40 percent growth.Sonia: In the export market what does the trend look like because this time you have done better than what you did last month?A: Exactly and in the second half of last year we did about 740,000 units in the full six months. That is already a 10 percent growth. That should take us to the guidance that we have given. But we hope to do better than that.So, in all we are looking at a very solid H2. In domestic we are looking at motorcycle, we are looking at 40 percent growth. In petrol and diesel we are doing very well. Cargo has already reached four digit figure and in exports we are going to be much better than the comparable H2 anyway and we are looking at better numbers there.

first published: Aug 2, 2016 10:59 am

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