The revival of rural spending has turned out to be a bright spot for the domestic two-wheeler industry, which has lined up models across EV and ICEV categories during this fiscal. A senior official of TVS Motor Company affirmed that a sizeable chunk of its scooter sales will be on the back of exceptional growth in the rural markets.
“India is poised for growth in both urban and rural markets. If you refer to the Vahan data, which is the real indices of what is happening in the customer buying pattern, the (two-wheeler) industry grew 13.5 percent," TVS Motor CEO K.N. Radhakrishnan told reporters. He also stated that rural markets contribute 50 percent of its total scooter sales across ICE and EV segments.
He noted that the share of the scooter segment is witnessing growth in both urban and rural regions. Citing the Vahan data, he stated that the proportion of two-wheelers in the rural markets is becoming better. “Growth in the rural is around 14.5 percent, while urban is only 12 percent,” he noted.
"We are seeing the rural markets picking up. The rural proportion of the two wheelers is becoming better as it is almost 52 percent rural and 48 percent urban sales mix. Thanks to the government's thrust on infrastructure investments and roads getting better, everybody wants to look at a two wheeler. So there is a huge opportunity. I always believe that you will see a CAGR of minimum 10 percent (growth) in the two wheeler space," added Radhakrishnan.
The Chennai-based two-wheeler maker introduced the new Jupiter 110 a starting price of Rs 73,700 (ex-showroom, Delhi). The second-generation Jupiter by TVS Motor will be pitted against other 110cc ICE scooters such as Honda Activa and Hero Pleasure Plus. The company is also working on a 125cc version of this model apart from a slew of e-scooters.
Referring to the new launch, he said, “We are confident that this product will further build our position in the two-wheeler market The most important thing is that aspiration wise, this product will delight every customer in India, whether it is rural, urban, or semi urban.”
Meanwhile, the company expects the scooter segment to grow further and account for around 40 per cent of its overall two-wheeler sales.
“Our share is currently around 32 percent. I am a firm believer that the scooter segment will substantially expand, it may even go to 40 per cent and above, that's my expectation," added Radhakrishnan. He revealed that the company has outpaced the industry in scooter sales with a compound annual growth rate (CAGR) of 12 per cent compared with the industry's 8 per cent."
When asked about the sales outlook for the festive season, Radhakrishnan said, "Currently, the momentum is very good. Currently, we are having around 12.5 percent of growth (and) we are optimistic that this season it is going to be much better than the 12.5 percent mark."
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