TVS lines up Rs 350 cr capex in 2017-18; looks to make most of BMW tie-up

Two-wheeler auto-major TVS Motor said it would close financial year 2017 with a 14.3 per cent market share, close to its target of 15 per cent. The company also said it would be launching one new bike and scooter and that it had plans to invest Rs 350 crore in financial year 2018.

K N Radhakrishnan, CEO, TVS Motor, said that during the third quarter, the company's market share was 15 per cent. But from November to February, due to demonetisation, poor monsoon and other factors, the industry slowed down and so did the company's growth.

"We hope to exit at 14.2-14.3 per cent market share in the current financial year. While the objective is to achieve 18 per cent market share over the next two years," said Radhakrishnan.

The company's current market share in scooters was close to 17 per cent in the third quarter of 2016-17 and it had around eight per cent market share in the motorcycle segment in the third quarter of 2016-17.

Meanwhile, for 2017-18, the company has lined up capital expenditure of Rs 350 crore for new products and capacity expansion.

"We will further our portfolio with new launches and upgrades of existing products," said Radhakrishnan.

Radhakrishnan said that the industry was poised to grow at 8-10 per cent and the company hoped to grow faster than the industry.

The company also expected rural demand to be better than last year with a healthy monsoon and higher budgetary allocation towards rural development.

Further, the company cited economic development, good monsoon, construction of reservoirs, good agricultural output, and investment in infrastructure as reasons which would lead to a revival in rural demand.

On TVS' tie-up with German automobile giant BMW, he said that the company would be focusing on premium bikes and the high-end segment.

"The BMW tie-up would lead to a 310cc platform. The TVS version on the BMW platform (Akula) would be rolled out during 2017-18," said Radhakrishnan.

Recently, TVS started exporting products for BMW to Germany. These products are manufactured at TVS' Hosur facility, near Chennai.

On the Indonesian subsidiary, he said that the Indonesian arm was expected to break-even by next year. He noted that, already, the loss had been brought down by 50 per cent in 2016-17.

TVS Motor Company