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Company Perspectives:
Key Dates:
Company History:
1
Bajaj Auto Limited is India's largest manufacturer of scooters and
motorcycles. The company generally has lagged behind its Japanese rivals in
technology, but has invested heavily to catch up. Its strong suit is high-
volume production; it is the lowest-cost scooter maker in the world.
Although publicly owned, the company has been controlled by the Bajaj
family since its founding.
Origins
The Bajaj Group was formed in the first days of India's independence from
Britain. Its founder, Jamnalal Bajaj, had been a follower of Mahatma
Gandhi, who reportedly referred to him as a fifth son. 'Whenever I spoke of
wealthy men becoming the trustees of their wealth for the common good I
always had this merchant prince principally in mind,' said the Mahatma after
Jamnalal's death.
The precursor to Bajaj Auto had been formed on November 29, 1945 as M/s
Bachraj Trading Ltd. It began selling imported two- and three-wheeled
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vehicles in 1948 and obtained a manufacturing license from the government
11 years later. The next year, 1960, Bajaj Auto became a public limited
company.
Rahul Bajaj reportedly adored the famous Vespa scooters made by Piaggio
of Italy. In 1960, at the age of 22, he became the Indian licensee for the
make; Bajaj Auto began producing its first two-wheelers the next year.
Rahul Bajaj became the group's chief executive officer in 1968 after first
picking up an MBA at Harvard. He lived next to the factory in Pune, an
industrial city three hours' drive from Bombay. The company had an annual
turnover of Rs 72 million at the time. By 1970, the company had produced
100,000 vehicles. The oil crisis soon drove cars off the roads in favor of
two-wheelers, much cheaper to buy and many times more fuel-efficient.
A number of new models were introduced in the 1970s, including the three-
wheeler goods carrier and Bajaj Chetak early in the decade and the Bajaj
Super and three-wheeled, rear engine Autorickshaw in 1976 and 1977. Bajaj
Auto produced 100,000 vehicles in the 1976-77 fiscal year alone.
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infringement suits to block Bajaj scooter sales in the United States, United
Kingdom, West Germany, and Hong Kong. Bajaj's scooter exports
plummeted from Rs 133.2 million in 1980-81 to Rs 52 million ($5.4 million)
in 1981-82, although total revenues rose five percent to Rs 1.16 billion.
Pretax profits were cut in half, to Rs 63 million.
Japanese and Italian scooter companies began entering the Indian market in
the early 1980s. Although some boasted superior technology and flashier
brands, Bajaj Auto had built up several advantages in the previous decades.
Its customers liked the durability of the product and the ready availability of
maintenance; the company's distributors permeated the country.
The Bajaj M-50 debuted in 1981. The new fuel-efficient, 50cc motorcycle
was immediately successful, and the company aimed to be able to make
60,000 of them a year by 1985. Capacity was the most important constraint
for the Indian motorcycle industry. Although the country's total production
rose from 262,000 vehicles in 1976 to 600,000 in 1982, companies like rival
Lohia Machines had difficulty meeting demand. Bajaj Auto's advance orders
for one of its new mini-motorcycles amounted to $57 million. Work on a
new plant at Waluj, Aurangabad commenced in January 1984.
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The 1986-87 fiscal year saw the introduction of the Bajaj M-80 and the
Kawasaki Bajaj KB100 motorcycles. The company was making 500,000
vehicles a year at this point.
Although Rahul Bajaj credited much of his company's success with its focus
on one type of product, he did attempt to diversify into tractor-trailers. In
1987 his attempt to buy control of Ahsok Leyland failed.
The Bajaj Sunny was launched in 1990; the Kawasaki Bajaj 4S Champion
followed a year later. About this time, the Indian government was initiating
a program of market liberalization, doing away with the old 'license raj'
system, which limited the amount of investment any one company could
make in a particular industry.
A possible joint venture with Piaggio was discussed in 1993 but aborted.
Rahul Bajaj told the Financial Times that his company was too large to be
considered a potential collaborator by Japanese firms. It was hoping to
increase its exports, which then amounted to just five percent of sales. The
company began by shipping a few thousand vehicles a year to neighboring
Sri Lanka and Bangladesh, but soon was reaching markets in Europe, Latin
America, Africa, and West Asia. Its domestic market share, barely less than
50 percent, was slowly slipping.
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By 1994, Bajaj also was contemplating high-volume, low-cost car
manufacture. Several of Bajaj's rivals were looking at this market as well,
which was being rapidly liberalized by the Indian government.
Bajaj Auto produced one million vehicles in the 1994-95 fiscal year. The
company was the world's fourth largest manufacturer of two-wheelers,
behind Japan's Honda, Suzuki, and Kawasaki. New models included the
Bajaj Classic and the Bajaj Super Excel. Bajaj also signed development
agreements with two Japanese engineering firms, Kubota and Tokyo R & D.
Bajaj's most popular models cost about Rs 20,000. 'You just can't beat a
Bajaj,' stated the company's marketing slogan.
The Kawasaki Bajaj Boxer and the RE diesel Autorickshaw were introduced
in 1997. The next year saw the debut of the Kawasaki Bajaj Caliber, the
Spirit, and the Legend, India's first four-stroke scooter. The Caliber sold
100,000 units in its first 12 months. Bajaj was planning to build its third
plant at a cost of Rs 4 billion ($111.6 million) to produce two new models,
one to be developed in collaboration with Cagiva of Italy.
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New Tools in the 1990s
Still, intense competition was beginning to hurt sales at home and abroad
during the calendar year 1997. Bajaj's low-tech, low-cost cycles were not
faring as well as its rivals' higher-end offerings, particularly in high-powered
motorcycles, since poorer consumers were withstanding the worst of the
recession. The company invested in its new Pune plant in order to introduce
new models more quickly. The company spent Rs 7.5 billion ($185 million)
on advanced, computer-controlled machine tools. It would need new models
to comply with the more stringent emissions standards slated for 2000. Bajaj
began installing Rs 800 catalytic converters to its two-stroke scooter models
beginning in 1999.
Although its domestic market share continued to slip, falling to 40.5 percent,
Bajaj Auto's profits increased slightly at the end of the 1997-98 fiscal year.
In fact, Rahul Bajaj was able to boast, 'My competitors are doing well, but
my net profit is still more than the next four biggest companies combined.'
Hero Honda was perhaps Bajaj's most serious local threat; in fact, in the fall
of 1998, Honda Motor of Japan announced that it was withdrawing from this
joint venture.
Bajaj Auto had quadrupled its product design staff to 500. It also acquired
technology from its foreign partners, such as Kawasaki (motorcycles),
Kubota (diesel engines), and Cagiva (scooters). 'Honda's annual spend on R
& D is more than my turnover,' noted Ruhal Bajaj. His son, Sangiv Bajaj,
was working to improve the company's supply chain management. A
marketing executive was lured from TVS Suzuki to help push the new
cycles.
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Several new designs and a dozen upgrades of existing scooters came out in
1998 and 1999. These, and a surge in consumer confidence, propelled Bajaj
to sales records, and it began to regain market share in the fast-growing
motorcycle segment. Sales of three-wheelers fell as some states, citing
traffic and pollution concerns, limited the number of permits issued for
them.
In late 1999, Rahul Bajaj made a bid to acquire ten percent of Piaggio for
$65 million. The Italian firm had exited a relationship with entrepreneur
Deepak Singhania and was looking to reenter the Indian market, possibly
through acquisition. Piaggio itself had been mostly bought out by a German
investment bank, Deutsche Morgan Grenfell (DMG), which was looking to
sell some shares after turning the company around. Bajaj attached several
conditions to his purchase of a minority share, including a seat on the board
and an exclusive Piaggio distributorship in India.
8
Employment fell from about 23,000 in 1995-96 (the year Bajaj suffered a
two-month strike at its Waluj factory) to 17,000 in 1999-2000. The company
planned to lay off another 2,000 workers in the short term and another 3,000
in the following three to four years.
Principal Subsidiaries: Bajaj Auto Finance Ltd.; Bajaj Auto Holdings Ltd.;
Bajaj Electricals Ltd.; Bajaj Hindustan Ltd.; Maharashtra Scooters Ltd.;
Mukand Ltd.
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COMPANY PROFILE
Bajaj Auto Ltd. is the largest exporter of two and three wheelers. With
Kawasaki Heavy Industries of Japan, Bajaj manufactures state-of-the-art
range of two-wheelers. The brand, Pulsar is continually dominating the
Indian motorcycle market in the premium segment. Its Discover DTSi is also
a successful bike on Indian roads.
Quick Facts
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• Bajaj Nagar, Waluj Aurangabad 431136
Products Brands
Motorcycles 4S 4S Champion Bajaj Avenger
Bajaj CT 100 Bajaj Discover Bajaj Platina
Bajaj Pulsar Bajaj Pulsar DTSi Bajaj Sonic
Bajaj Wind 125 Bajaj XCD 125 Boxer
Caliber Caliber115 Kawasaki Bajaj Eliminator
KB RTZ KB100 KB125
Scooters Bajaj Chetak Bajaj Kristal Dtsi Bajaj Wave
Since 1986, there is a technical tie-up of Bajaj Auto Ltd. with Kawasaki
Heavy Industries of Japan to manufacture state-of-art range of latest two-
wheelers in India. The JV has already given the Indian market the KB series,
4S and 4S Champion, Boxer, the Caliber series, and Wind125.
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than hundred years. The technologies of KHI have redefined space systems,
aircrafts, jet engines, ships, locomotive, energy plants, automation system,
construction machinery, and of course high reliability two-wheelers.
KHI has given the world its legendary series of 600-1200cc Ninja and 1600
Vulcan bikes. Straight from its design boards, the Kawasaki Bajaj
Eliminator, India's first real cruiser bike, redefines the pleasure of "biking"
in looks as well as performance.
The group’s flagship company, Bajaj Auto, is ranked as the world’s fourth
largest two- and three- wheeler manufacturer and the Bajaj brand is well-
known in over a dozen countries in Europe, Latin America, the US and Asia.
His son, Kamalnayan Bajaj, then 27, took over the reins of business in
1942. He too was close to Gandhiji and it was only after
Independence in 1947, that he was able to give his full attention
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to the business. Kamalnayan Bajaj not only consolidated the
group, but also diversified into various manufacturing activities.
The present Chairman of the group, Rahul Bajaj, took charge of the
business in 1965. Under his leadership, the turnover of the Bajaj Auto
the flagship company has gone up from Rs.72 million to Rs.100.76
billion (USD 2.3 billion), its product portfolio has expanded from one to
and the brand has found a global market. He is one of
India’s most distinguished business leaders and internationally
respected for his business acumen and entrepreneurial spirit.
.
COMPANY FLASHBACK
Bajaj Auto Ltd. sales have increased by approximately 21 per cent in the
year 2004-05, which exceeds Rs 65.4 billion, a record in the history of the
company. The gross operating profit stands at Rs. 9.3 billion, again a record.
The profits after tax of the BAL are close to Rs. 7.7 billion, and the pre-tax
return on operating capital is at an impressive 80 per cent.
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Bajaj Auto is a major Indian automobile manufacturer. It is India's largest
and the world's 4th largest two- and three-wheeler maker. It is based in
Pune, Maharashtra, with plants in Akurdi and Chakan (near Pune),Waluj
(near Aurangabad) and Pantnagar in Uttaranchal. Bajaj Auto makes and
exports motorscooters, motorcycles and the auto rickshaw.
The Forbes Global 2000 list for the year 2005 ranked Bajaj Auto at 1946
Over the last decade, the company has successfully changed its image from a
scooter manufacturer to a two wheeler manufacturer. Its product range
encompasses Scooterettes, Scooters and Motorcycles. Its real growth in
numbers has come in the last four years after successful introduction of a
few models in the motorcycle segment.
The company is headed by Rahul Bajaj who is worth more than US$1.5
billion
OBJECTIVES
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o TO STUDY COMPANY PROFILE
AUTOMOBILES
RESEARCH METHODOLOGY
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methodology is a jumbled mess. Different methodologies define distinct
schools which wage religious wars against each other.
Methods are tools. Use them; don't let them use you. Don't fall for slogans
that raise one above the others: ``AI research needs to be put on firm
foundations;'' ``Philosophers just talk. AI is about hacking;'' ``You have to
know what's computed before you ask how.'' To succeed at AI, you have to
be good at technical methods and you have to be suspicious of them. For
instance, you should be able to prove theorems and you should harbor
doubts about whether theorems prove anything.
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Some work is like science. You look at how people learn arithmetic, how the
brain works, how kangaroos hop, and try to figure it out and make a testable
theory. Some work is like engineering: you try to build a better problem
solver or shape-from algorithm. Some work is like mathematics: you play
with formalisms, try to understand their properties, hone them, prove things
about them. Some work is example-driven, trying to explain specific
phenomena. The best work combines all these and more.
Methodologies are social. Read how other people attacked similar problems,
and talk to people about how they proceeded in specific cases. Research
Methodology can be done by two methods
1. Primary Data
2. Secondary Data
DATA COLLECTION
Products
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Two-wheelers
Ungeared - 100 cc
Motorcycles - 100 to 200 cc
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Bikes
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21
22
Scooters
Three wheelers
1. Goods carriers
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2. Passenger Carriers
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25
Policies
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27
Group Companies
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Bajaj Auto is the flagship of the Bajaj group of companies. The group
comprises of 35 companies and was founded in the year 1926. The
companies in the group are:
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Sanraj Nayan Investments Pvt.
P T Bajaj Auto Indonesia (PTBAI)
Ltd.
Bajaj Auto International Holdings
-
BV, Netherlands (BAIBHV).
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SEGMENT-WISE REVENUE, RESULTS AND CAPITAL EMPLOYED
(Rs. In Lakhs)
QUARTER QUARTER HALF YEAR HALF YEAR YEAR
ENDED ENDED ENDED ENDED ENDED
30.09.2008 30.09.2007 30.09.2008 30.09.2007 31.03.2008
(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Audited)
Segment
Revenue
Automotive 254843 236182 485919 447047 904617
Investment 2210 2595 5088 5928 12267
Total 257073 238777 491007 452975 916884
Segment Profit/
(Loss) before
Tax and Interest
Automotive 24968 33351 48293 57425 101722
Investment 2210 2595 5088 5928 12267
Total 27178 35946 53381 63353 113989
Less: Interest 587 136 679 142 516
Total Profit 26591 35810 52702 63211 113473
Before Tax
Capital
Employed
Automotive 140014 148759 140014 148759 136867
Investment 171039 164960 171039 164960 190020
Unallocable (2842) (4965) (2842) (4965) (33596)
Total 308211 308754 308211 308754 293291
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Sales in number for the year 2008
1st October 2008
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Sales in numbers for the month of October 2008
1st November 2008
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S.W.O.T ANALYSIS OF BAJAJ
Strengths:
Our members value the professional designation.
We have a lower course fee structure than similar programs.
We provide good customer service.
Our instructors are highly-regarded in the profession.
We have a small staff and low overhead.
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Weaknesses:
We are slow to make decisions and adapt to changes that affect the
profession.
The professional designation is rarely included as a condition of
employment.
We are overly dependent on key volunteers who developed and teach our
certification courses.
We do not have the resources to research the market and promote the
designation.
Opportunities:
Our local council wants to encourage local businesses with work where
possible
Threats:
A small change in focus of a large competitor might wipe out any market
position we achieve
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INFRASTRUCTURE OF BAJAJ
Plants
Bajaj Auto's three plants at Akurdi, Waluj and Chakan in Maharashtra and one plant at pant
Nagar in Uttranchal, western India, produced 1,814,799 vehicles in 2004-05.
Akurdi Geared scooters, ungeared scooters, CT100 and Discover
Waluj Bajaj - Kawasaki range of motorcycles and three-wheelers
Chakan Bajaj motorcycles - Pulsar and Discover
Pant
Bajaj motorcycles – Platina
Nagar
Plant Locations
Bajaj Auto plants are located at:
Mumbai - Pune Road, Akurdi, Pune 411 035
Bajaj Nagar, Waluj, Aurangabad 431 136
MIDC, Plot No A1, Mahalunge Village, Chakan 410 501 Dist. Pune
Plot No. 2, Sectoe 10 Phase -II - E, Pant Nagar, Sidcul, Rudrapur Dist.
Udhamsingh Nagar Uttranchal
MANAGEMENT PROFILE
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Madhur Bajaj Vice Chairman
Rajiv Bajaj Managing Director
Sanjiv Bajaj Executive Director
HR BAJAJ
Recruitment Policy
A large number of our recruits are fresh engineers and MBAs. Natural
attrition is usually taken care of by promotions and horizontal movements
37
within the organisation to provide career opportunities for our employees.
Occasionally, specific skill-sets may warrant lateral recruitment.
Work Culture
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Our work culture supports and enhances our brand. The Bajaj brand signifies
excitement. Bajaj strives to inspire confidence through excitement
engineering. The culture is built on core values of learning, innovation,
perfection, speed and transparency. Facilitative leadership style helps in
developing leaders at all levels and establishes accountability.
Perfection
Speed
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Competency Building
Bajaj Auto has a very flat organisation structure with three management
levels. Each level represents a specific role and hence needs relevant
competencies. Competency building at Bajaj Auto is a combination of
development for current and future roles.
Compensation Philosophy
We strive to be amongst the top quartile in our compensation structure.
Competence and performance are the key drivers of our compensation
policy. A significant part of the compensation is in the form of variable pay
linked to the individual’s and the organisation’s performance.
FINDINGS
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Motorcycles: Domestic
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The somewhat greater fall of the Company’s motorcycle sales vis-à-vis the
industry needs explaining.
SUGGESTIONS
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Cheaper products (Motorcycles) should be introduced by the
company so that it can reach the middle class public.
Company should launch bikes with less cost & best average.
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Company should offer more products to the customer in
CONCLUSION
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BAL is committed to prevention of pollution, continual improvement of
environment performance and compliance with all environmental legislation
and regulations. They always believe in providing the customer 'value for
money' and keeps an special eye upon quality, safety, productivity, cost and
delivery. It incorporates a high degree of power with fuel efficiency of a 100
cc motorcycle.
In this project primary data is being used. The questionnaire is being filled
up by 25 persons & according to them bajaj is a good automobile industry &
should add more features in their products & increase their production so
that the company can satisfy their needs successfully.
45
BIBLIOGRAPHY
Books:-
Magazines:-
Auto magazine
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Over drive magazine
Business today
Websites:-
www.bajajauto.com
www.google.com
www.msn.com
Newspapers:-
Times of India
The Indian Express
ANNEXURE
Questionnaire
Please put tick mark in the brackets or put number where ever is
necessary.
Name…………………………………………………….
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Address ………………………………………………….
………………………………………………….
Age ………………………………….
………………………………………………………
………………………………………………………..
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Below 50000 ( ) 50000-2 lakh ( )
…………………………………………………………
…………………………………………………………….
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4. Do you like our vehicles
Yes ( ) No ( )
Yes ( ) No ( )
Yes ( ) No ( )
50
8. Are you satisfy with the average in the vehicles?
Yes ( ) No ( )
51