Case Overview:

In 2007 Bajaj Auto Limited acquired 14.5% stake in KTM Power Sports AG an Austrian automobile
company specialized in sports motorcycles in Europe. The merger happened to expand the presence
of Bajaj Auto Limited in South Asian Countries and technology transfer of specialized water cooled
four stroke 125cc and 250cc engines designed by KTM. Bajaj Auto has currently more than 47% stake
in KTM Power Sports AG.

In India, Bajaj Auto launched the KTM Duke 200 in January 2012, although the motorcycles units sold
was just 0.1% more than previous year, Bajaj Auto decided to launch the new product in super sport
category – KTM Duke 200 which is being retailed through exclusive KTM showrooms. With a new 4-
stroke single-cylinder fuel injection and water-cooled engine, 6-speed transmission and good fuel
efficiency consumption, the KTM Duke 200 gives youth an alternative from Pulsar and Karizma to
choose from and

Has the management took the right decision by launching KTM Duke 200 despite low growth in
motorcycle sales in India in FY 2012-13.

Expected Learning Outcomes:

a) Use of BCG and ANSOFF Matrix to analyse the new product launch by the company. SWOT
and Porter’s five forces analysis to find the industry trends and company’s competitive
advantage.
b) Market segmentation to target the youth customers and new market development
c) Identify operating fixed cost and operating variable cost of the company.
d) Use of financial statements to find P/V ratio, breakeven sales, gross profit margin and
analyse them to new product launch, their significance and relationship.