The Hindu : Business : Bajaj Auto plans to launch 3 scooters

Online edition of India's National Newspaper
Thursday, May 12, 2005

Business

Business

Bajaj Auto plans to launch 3 scooters

Staff Correspondent

Net profit at Rs. 767 crs.; pays 250 p.c. dividend

— Photo: Vivek Bendre

Rajiv Bajaj

MUMBAI: Bajaj Auto is keen to regain some of its market share. "We are virtually a non-entity in scooters now. Because motorcycles are doing so well, scooters must stand for a sharp position to outweigh the benefits of a motorcycle," said Rajiv Bajaj, Managing Director, while announcing the company's annual results here on Wednesday. "We have conceived three such scooters and the first of these will be launched early next year. We will launch all three of them over 12-18 month period."

The company reported a net profit of Rs. 766.80 crores for 2004-05 against Rs. 731.50 crores in the previous year on a turnover of Rs. 6,335.20 crores (Rs. 5,270.30 crores). The board of directors has recommended an unchanged dividend of Rs. 25 per share (250 per cent).

The three motorcycle brands — CT 100, Discover and Pulsar upgrades — enabled the company to outperform the industry. The new ungeared scooter, Wave, was launched in March this year in Pune and will be rolled out nationally in the second quarter of this year. The premium-end 180cc Avenger will be launched in the second quarter this year.

The company has opened a representative office in Jakarta, Indonesia, to explore the market for its two and three wheelers. "That is a 7-8 million two-wheeler per annum market and we are looking to go over there in 18-24 months and build a presence," said Sanjiv Bajaj, Executive Director.

On the relationship with Kawasaki Mr. Bajaj said, "While their focus is the higher end, we are in the mass market. They have a presence in the ASEAN region and so saved us time and money. Bajaj products could be relevant to Kawasaki in any market. The theme is our product appeal and potential and their presence. The details will be worked out over time."

Bajaj is now working on developing a bigger motorcycle and according to the MD, "when we already make a good small motorcycle, it is quite easy to make a large one.

The company is also developing a four-wheeler in the goods carriage segment, although the time to market could be three years. The company is increasing the capacity at its Chakan plant from 1,600 units to 2,400 units a day at an incremental cost of only Rs. 40 crores. "Pulsar sells 26,000 units a month and Avenger is being introduced. The increase in capacity will cater to incremental demand for these bikes in future."

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