TVS Motor Company has said it is developing a high-power, four-stroke racing bike, claiming it to be be India's first indigenously produced motorcycle for racing.

A senior company official said on Friday the 18 to 20 hp bike, with four valves, is being developed with a specially designed suspension system.

"It would be between 150 cc and 175 cc," Vice-President of the company's R&D, Vinay Harne, said.

He said price tag would depend on the number of units to be produced. The bike would hit the road in two years time.

Meanwhile, TVS Racing, the company's racing division, has decided to participate in the forthcoming motocross events in Sri Lanka, China, Thailand and Malaysia, he said.
 

The country's largest utility vehicle maker, Mahindra & Mahindra, will launch in the next three months two variants of its premium Bolero model, targeted at customers in new segments, a company official has said.

A jump in its utility vehicle sales, spurred by the launch of a new model, partly contributed to the company's return to profit in the October-December quarter after two loss-making quarters.

"There will be the Camper in mid-March, which is a double-cab pick-up with the Bolero look...and the petrol variant of the Bolero in May," Rajesh Jejurikar, vice-president of marketing at Mahindra & Mahindra, said on the phone from Mumbai.

The company, also India's largest tractor maker, has a 47 per cent share of the six-player utility vehicle market, but has been trying to fend off competition from Japan's Toyota, which launched its Qualis utility vehicle in 2000.

In just two years, Toyota has become the second-largest player in the industry, with a 23 per cent market share.

By targeting new customer segments with fresh models, Mahindra hopes to increase its market share in an increasingly competitive industry.

Bolero variant
The first Bolero variant, the stylish and sporty Camper, is aimed at the rural and semi-urban market, where it could also be used as a cargo carrier, Jejurikar said.

The Camper will be priced at around Rs lakh and the company aims to sell 200 to 300 of these a month. It will have a 2,523 cc engine and can carry a payload of more than a tonne.

The petrol variant will use a 1,817 cc Isuzu engine and is targeted at a segment that is expected to grow after India lifts controls on diesel and petrol prices from April 1.

Diesel in India is far cheaper than petrol so that nearly all of the about 125,000 utility vehicles sold every year use diesel engines. The difference is expected to narrow after April 1.

Return to profit
Mahindra returned to profit in October-December after two loss-making quarters, helped, in part, by a 9.7 percent rise in its utility vehicle sales in a flat industry.

It said its market share in utility vehicles improved to 51.3 in October-December from 47.3 percent in the same year-ago period largely due to the introduction of a new model MAXX.

The MAXX, a fuel-efficient model launched in October, with space to match its main competitors, the Toyota Qualis and the Tata Sumo, is designed for rugged rural applications.

Jejurikar said another recent launch, the Marshal Royale, with improved interiors from its basic version and which hit the market in mid-January, had also done well.

A soft-top version of the MAXX was also being considered for a launch later this year, he added.

Sales of Indian utility vehicles increased just 2.31 percent in April-January, the first 10 months of the fiscal year, to 100,347 units. But growth is expected to pick up with a string of new model launches planned by several companies over the next two years.

Hindustan Motors, which makes Mitsubishi products under license, plans to launch the Pajero this quarter, Ford is considering the Escape or the Splash, while Hyundai will launch its Terracan sports utility vehicle in the middle of the year.

Mahindra itself is poised to launch later in the year the Scorpio, a new premium utility vehicle that it is developing by itself.
 

Tata has emerged the top Indian-owned brand in A&M magazine’s Top Brands survey. It is ahead of other homegrown brands such as Nirma, HMT, Godrej, Fevicol, Dabur, Amul, Hero, SBI and Bisleri.

But among Indian and foreign-owned brands in India, Tata ranks third behind Colgate, the leader, and Dettol. The fourth and fifth spots have been bagged by Hindustan Lever soap brands, Lux and Lifebuoy, respectively.

Interestingly, in the last Top Brands survey carried out by the magazine in 1999, Tata occupied the 22nd spot. Since then, it has leapfrogged into the top bracket.

Tata’s gain has been Amul’s loss -- the latter has slipped from second place in the 1999 survey to 42nd in the latest Top Brands survey.

The survey says Tata has been able to improve its position largely due to the recent success of Tata Indica.

“The only major change since 1999 has been the extra salience the brand (and its recognised logo) has got on the back of Tata Engineering’s small car, Tata Indica,” the survey says. Apart from Tata Indica, Tata Tea is the other well-known brand from the Tata stables.

Through the Tata Salt brand, Tata also has a marked presence in Indian kitchens. Tata has topped in the north, ahead of Colgate and Dettol. In the east, it has been ranked third.

However, in the west and south, the brand does not even feature among the top ten. Of the metro brands, it has been placed at number three, while among urban as well as rural brands, it has been rated number four.

For the first time, Tata has been rated among the top 10 rural brands. Among housewives and young men, it has bagged the fifth spot.

The other homegrown brands making it to the list of the top 60 brands are Bisleri, Maruti, LIC and Kissan. Prestige, T-Series, Tortoise, Topaz and MRF have not found a spot in the latest survey.

The survey was conducted in all the geographical zones. The interviewees were housewives, chief wage earners of families and young adults from various income groups.

The sample size of the survey was 2,499, of which 931 were housewives and 887 chief wage earners. The survey was conducted by A&M in association with TNS-Mode.
 

Bajaj Allianz General Insurance Company will be ending the year with a premium earning of over Rs 90 crore. But if the company manages to cross the Rs 100-crore mark, it will emerge as the number one player among the new private non-life insurance companies, Rahul Bajaj, chairman Bajaj Allianz said.

About 40 per cent of the policies are motor vehicle insurance policies of which 80 per cent are four-wheelers and 20 per cent are two-wheelers, predominantly Bajaj Auto Ltd’s customers, Bajaj said. On the claims side the company is favourably below the market levels. “Unlike in the life insurance business, new business in general insurance will be slower to come by,” Mr Bajaj said. At the moment almost 60 per cent of the business is being taken from the public sector players. But the insurance market size has increased with the public sector players being the biggest beneficiaries, he said.

Bajaj Allianz is a JV between Allianz AG and Bajaj Auto with a paid up capital of Rs 110 crore, The general insurance business has completed eight months operation and crossed one lakh policy sales. The bankassurance business with Standard Chartered too has taken off with sale of policies from end of January 2002. “We are open to more such alliances,” Mr Bajaj said.

But with other players getting their act together is the general-insurance business getting overcrowded, Heinz Dollberg, executive vice-president, Asia-Pacific, Allianz and director of Bajaj Allianz does not think so. “We are used to operating in a competitive market like Germany, where there are 500 insurance companies selling policies to 80 million people. So India is hardly a crowded market for us,” Dollberg said. Bajaj Allianz has put in place a network of 20 branches. The Pune Regional office was launched on Thursday, February 21. “Pune is a strategic and important region for us and our focus here is on the engineering and manufacturing sector, as these are industries that offer growth potential in terms of new business,’ Bajaj said. The company is targeting a premium of Rs 150 to Rs 160 crore in the first full year of operation.
 

Two-wheeler sector has stood tall amongst the ruins seen in smokestack companies hit by the slowdown purely on the the basis of strong fundamentals and robust growth. The sector has outperformed in the first two months of 2002 and is among fund managers favourites.

The inclination of fund managers towards two-wheelers is clearly witnessed by the sharp surge in stock-prices of two-wheeler makers — Hero Honda, TVS Motor Company and Bajaj Auto — have all hit a 52-week in the last one month. Compared to its 52-week low, Hero Honda has gained 214 per cent till date, TVS Motor Company has gained 450 per cent while Bajaj Auto has gained 114 per cent.

On Friday, the two-paid up stocks of Hero Honda hit a all-time of Rs 367 on BSE. However, profit-booking trimmed gains and the stock finally closed up Rs 18.30 at Rs 363.60 rupees, TVS Motor Company closed up Rs 19.15 at Rs 357.60, the stock in its intraday movement hit a 52-week high of Rs 362 while Bajaj Auto closed up Rs 2.95 at Rs 445.30, Bajaj Auto Stock had hit a 52-week high of Rs 472.50 on January 21, 2002.

Said Sunidhi Consultancy Services Ltd’s auto analyst, Richard D’Souza: “The prices of motorcycle stocks are backed by performance. When the economy was not doing well, this sector was witnessing a lot of demand so the inclination towards this sector by fund managers is not surprising”.

“Hero Honda shares were undervalued and are getting corrected”, dealers said. Hero Honda has a different story altogether in a slowing economy. It has increased motor cycle sales number for the financial year and has raised numbers to 1.3 million from 1.2 million motorcycle sales.

Said Mr D’Souza: “Bajaj Auto is a different story. If the strategies planned by the companys goes off smoothly, the stock would be an outperformer in one year”. Mr D’Souza added that TVS Motor’s price-surge s a difficult call to make as success of one model doesn’t mean a complete success for the company”.

Pranav Securities’ auto analyst, Gautam Bhasin said, “Basically, all these stocks are front running ahead of Budget. There are lot of expectations in Budget like rural funds, in the form of lowering of excise duty for tractors. Rural funds means higher disposable income for farmers which means more demand for two-wheeler especially the motorcycle segment”.

“Fundamentals, robust sales are perculating to higher demand for this sector and with agriculture much better compared to earlier years the expectations in this sector is seen higher,” said an auto analyst at an American brokerage house.
 

Maruti Udyog will cut down the number of customer information centres (Anytime Maruti) across the country and centralise the operation at Delhi/Gurgaon. The company has decided to close down the centres in Mumbai, Bangalore, Chennai and Hyderabad.

Company sourses said, "With lower STD tariffs, it has become more cost effective for us to divert calls originating in any of these cities to our centre in Gurgaon." The savings from this consolidation exercise will offer the car maker an opportunity to scale up this service and touch other parts of the country. Industry insiders pointed out that it normally costs any company around Rs 40,000 per month to support one person in a call centre.

"In addition, we will also gain by way of providing uniform quality of response as customers calling in from other cities would get connected directly to our call centre in Delhi/Gurgaon," the sources added. Further, availability of centralised database at Delhi/Gurgaon would reduce the response time for the customers as also result in better monitoring and control, uniform infrastructure, training, and standards for service delivery across the country.

 

Tata Engineering and Locomotive Company (Telco) on Thursday said that it would set aside Rs 1,180 crore ($242 million) against reserves this year, a move analysts said would accelerate its return to profit.

India's largest truck maker said in a statement that it had Rs 1,702 crore in its "share premium account," the portion of reserves against which it will set this amount off - mostly for product development expenses.

"This will have a positive impact on net profit and reduce the size of the balance sheet, which is a good thing," said Kalpesh Parekh, an analyst at Mumbai-based Sushil Finance.

Telco, which also makes cars and utility vehicles, has posted losses for the past seven quarters.

The company, part of the Tata group, one of India's most powerful conglomerates, spent more than Rs 1,700 crore to develop and begin making the Indica, the first car developed entirely in India, but has struggled to find buyers since its launch in 1999.

But sales of the Indica have risen sharply since Telco rolled out an improved model early last year, up 41 per cent in the past 10 months over a year ago, and it now holds a 22 per cent share of the competitive premium hatchback category.

In the past quarter to December, Telco posted a loss of Rs 55.54 crore, of which 75 per cent was due to write-offs for expenses incurred in previous periods on product development and schemes to encourage employees to quit.

The newly announced set-off against reserves, however, will not dent the company's profit and loss account.

"The results (of the restructuring) will show in the fourth quarter (to March)," Praveen Kadle, Telco's executive director for finance and corporate affairs, said, adding it could take until June to receive all the necessary approvals.

The initiative is part of a restructuring plan involving cutting costs by reducing employees and working capital, and getting out of non-core businesses and financial investments.

Over the past 21 months, TELCO has slashed its operating costs by Rs 450 crore.

"Telco would have shown a profit in any case in the fourth quarter but the write-off will help it maintain this consistently in the periods ahead," said Satish Jain, an analyst at brokerage ASK Raymond James.

Since October 1, Telco's shares have doubled in value amid signs the company is on course to return to the black due to aggressive cost cutting and a big upturn in sales.

Telco expects to return to profit in the financial year beginning in April, helped also by a turnaround in truck sales.

Its sales of buses and medium and heavy trucks have risen 10 per cent year-on-year in the April-January period.
 

The beleaguered Daewoo Motor India has worked out an “unofficial arrangement with Indian banks” defer payment of interest and principle till the General Motors deal is worked out in Korea,” said a company official.

At the launch of the Daewoo-Fuchs Titan Formula DW engine oil for Daewoo cars, D W Kim, deputy managing director, DMIL, said, “Indian banks are supporting us on our working capital needs by not pushing for loan and interest payment while the negotiations are on in Korea.

We are also discussing the financial restructuring programme with financial institutions.” DMIL’s consortium of debtors includes banks like ICICI and HDFC and some FIs as well. DMIL expects the GM deal to go through by end April.

The company currently has kits to last another “two or three months after which we will import new models,” Kim said. “Korea is committed to supplying kits for India and we are preparing some model changes as well.” The changes would include an upgrade of the company’s B-segment model, Matiz.

“We will first introduce style changes and later an engine upgrade,” Mr Kim said. As for the much-delayed Kalos, Mr Kim said the company desperately needed a new model but a decision would be taken after the finalisation of the Korean situation. DMIL was also working on a business restructuring plan, he said, which would involve redundancies but refused define targets. The company, he said, is currently producing 600 units a month.

Earlier at the press conference, Mr Kersi Hilloo, managing director, Fuchs Lubricants (India), said his company was talking to several automobile companies for partnerships like the one inked with Daewoo.

Under the Daewoo partnership, Fuchs will offer tailor-made engine oils in three-litre and one-litre packs at a tag of Rs 350 and Rs 120 respectively. Partnering with key consumers is a critical business strategy that Fuchs follows worldwide.
 

Mahindra and Mahindra has decided to come out with a slew of new bus models. The Mahindra Tourister, a 2.5 litre minibus will be the first to be rolled out on the 26th of this month and will be available for sale from March 10. Although the debut variant would be a diesel model, a CNG variant will be launched by May. The new bus will be priced at Rs 4 lakh which is Rs 1.25 lakh cheaper than competition Bajaj Tempo Traveler.

The Tourister will be fitted with the Mahindra DI diesel engine (which is currently used in the Maxx) and will be available in 11+1 and 14+1 seating options. The company is also planning to launch minibuses in the 25 and 32 seater category in six to eight months time to further expand its LCV portfolio.

Fitted with an aluminium body the Tourister will boast metal bumpers and offer plenty of luggage room at the rear. The company hopes to sell around 450-500 units of the Tourister in a month. Mr Alan Durante, executive director and president, M&M, said "We are in the process of appointing 40 new dealers for the LCV and 3-wheeler range this year."
 

The road connecting Delhi with Gurgaon will be converted into an eight-lane toll expressway work on which will begin in August and be completed in three years.

When the expressway is complete it will take about 25 minutes to reach most parts of Gurgaon from Delhi. It takes 45 minutes at present.

Reaching the Indira Gandhi International Airport may also become much easier. Lt Governor Vijai Kapoor said on Thursday the National Highways Authority of India (NHAI) will construct nine flyovers, loops, underpasses and build service roads on a 28 km stretch of the highway between Delhi and Gurgaon to facilitate smooth driving.

Vehicles going to the IGI airport will be charged Rs 10 for using the toll road while those going to Gurgaon will have to pay Rs 15. The charges for heavier vehicles are still be to decided. Two-wheelers will not be allowed on the expressway. Those who do not wish to pay toll charges can use service roads, which will be constructed on either side of the expressway.

The project will be done on a build operate and transfer (BOT) basis and the contract has been given to Jai Prakash Industries and DS Construction of UK. The company will construct the expressway by December 2003 and maintain it for the next 17 years, during which it will collect a toll tax.

‘‘There has been large scale urban development in Gurgaon and traffic between the two cities has increased considerably in the recent past. Also, the link between the city and the airport is not very satisfactory. The project will be completed by December 2003. This project will also strengthen the concept of the NCR,’’ Kapoor said.

He said the expressway will have eight lanes at most places but could be restricted to six lanes at some stretches because of lack of space. Of the 28-km stretch, 18 km will be in Gurgaon and 10 km in Delhi.

NHAI chairman Deepak Dasgupta, who was present along with the LG said the expressway will have the modern eight toll booths on each side. ‘‘Vehicles will need to stop for just 12 seconds for their payments and entry,’’ he said. He said over 1,40,000 passenger cars units pass the IGI airport crossing every 24 hours. The number comes down to 1,00,000 PCUs at the Delhi-Gurgaon border and goes down to 90,000 PCUs in Gurgaon.