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Honda Motorcycles and Scooters India Ltd
May 15, 2013
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Honda Motorcycles and Scooters India Ltd.
Key Indicators
Major models
The company's models that constitute more than 10 per cent of its domestic or export volumes are:
Domestic market: Activa, Shine, Dream Yuga
Export market:CB Twister, Dio, Unicorn
Background
Honda Motorcycles and Scooters India (HMSI), established in 1999, is a wholly owned subsidiary of Honda Motor Company, Japan.
The company manufactures motorcycles and scooters in India. The company currently has two facilities at Manesar and Tapukara in
Rajasthan with annual output of 16 lakh units and 12 lakh units respectively. HMSI is the market leader in the scooters segment
which enabled it to improve its market share in domestic two-wheeler market from 13.7 per cent in 2008-09 to 18.9 per cent in
2012-13.
As of 2012-13, HMSI is the second largest two-wheeler company in India, which overtook the homegrown rival Bajaj Auto and
pushed it to the third position. HMSI registered a phenomenal growth of 31 per cent for FY 2012-13 (y-o-y) against the subdued
two-wheeler industry growth of 2.8 per cent during the same period.
As per the industry sources, the company has been undertaking an aggressive strategy to increase its market share in the
two-wheeler segment in India and challenge the number one position of erstwhile partner Hero with plans to produce 10 million units
by 2019-20 t hat may ent ai l t he company havi ng up t o ei ght pl ant s i n I ndi a.

Market position
HMSI's market share declines in scooters segment, but continues to be leader
HMSI - Segment-wise market share
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Source:CRISIL Research, SIAM
Scooters:
HMSI continues to dominate the scooters market, with 49 per cent market share, but lost around 9 per cent share in last 5 years.
Supply constraints and intensifying competition from TVS Scooters, Hero MotoCorp and Suzuki Motorcycles caused the decline in
market share of HMSI.
For 2012-13, HMSI's domestic scooter sales improved by 16 per cent, mainly on the back of new launches during the year. (Dio,
Activa and Aviator).
Motorcycles:
For 2012-13, HMSI registered a stout growth of 53.8 per cent in the motorcycle segment which was fuelled by its newly launched
model Dream Yuga.However, CB Twister (110 cc executive segment model) is yet to gain substantial market share in motorcycles
segment. HMSI is making efforts to ramp-up its distribution network of above 2,000 touch points to achieve better presence in rural
a n d s e m i - u r b a n a r e a s .

Player action
Model launches
HMSI launched the new variant of Dio with a larger 110 cc (8 BHP) engine priced at Rs 42,362 in February 2012. The a new
variant will come with improved front design and tail light arrangement. It will also feature tubeless tyres, wider seats and a
combi brake system (activates both brakes from a single press). The Dio was originally launched in 2002 with a 102 cc petrol
engine.
HMSI also launched the new sporty tri-colour motorcycle in the high performance CBR 250R. The newly launched
motorcycle is in addition to the two existing dual-tone colour options in CBR 250R - Candy Ruby Red(with Accurate Silver
Metallic) and Asteroid Black Metallic(with Accurate Silver Metallic).
In March 2012, the company launched another motorcycle in the premium category - CBR 150R priced at Rs 1,16,385
(ex-showroom, Delhi) for the standard variant and Rs. 1,17,385 (ex-showroom, Delhi) for the deluxe variant. The CBR 150R
is powered by a 150 cc, four-stroke, single-cylinder engine and a six-speed gearbox.
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HMSI launched its cheapest ever motorcycle Dream Yuga, in May 2012, priced at Rs. 44, 642 (Ex-showroom Delhi), with
110cc engine along with three variants.
Future model launches
HMSI is planning to launch a 125 cc scooter codenamed K24A - based on Aviator platform - and an executive segment
motorcycle (125-135cc) codenamed K23A which will compete with Bajaj Auto's Pulsar 135 LS.
The company unveiled its fourth 150cc bike model, the CB Trigger, in March 2013. The new model features a fully digital
instrument panel, Led backlight and the first combi-brake in the segment where both brakes are operated by a single lever.
The company claims the model has a fuel economy of 60 kmpl.The new model is expected to give competition to Bajaj
Auto's Pulsar - 150 cc.
In April 2013, the company unveiled its second Dream series mass motorcycle in 110 cc segment Dream NEO. The new
motorcycle is expected to be fuel efficient at 74kmpl with high power and revolutionary Honda Eco Technology.

Capital expenditure
In 2012-13, HMSI is investing Rs 1,500 crore in setting up of its third plant in Karnataka, which is expected to be operational by the
end of first quarter of this fiscal, taking the company's total production capacity to 40 lakh units annually. The Company is also
seeking a location to set up its fourth manufacturing plant in India.
Global plans
HMSI exports motorcycles and scooters to Europe and Nepal from its Haryana factory. The company has also entered markets like
Middle East, South-east Asia, Bangladesh, Latin America, West Asia and Sri Lanka. It exports models like Unicorn, Shine and CBF
Stunner. However, HMC management has indicated that the domestic market would be the main focus for Indian operations and
thus, exports are expected to remain relatively stagnant over the medium-term.

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