Summary
Indian Two-Wheeler Industry: Rural India to be in the driver's seat
The Indian two-wheeler industry has come long way since its humble beginning in 1948 when Bajaj Auto started importing and selling Vespa Scooters in India. Since then, the customer preferences have changed in favour of motorcycles and gearless scooterettes that score higher on technology, fuel economy and aesthetic appeal, at the expense of metal-bodied geared scooters and mopeds. These changes in customer preferences have had an impact on fortunes of the players. The erstwhile leaders have either perished or have significantly lost market share, whereas new leaders have emerged.
Rising income levels, reducing excise duties, higher loan tenure and loan-to-value offered by the financing companies have all fuelled the growth of two-wheeler sales in the country. Besides, mounting traffic chaos and limited parking space has also increased the demand for two-wheelers from households that can afford or actually do own a car. Furthermore, with increasing women working population, changing social philosophy and broad-mindedness, the penetration of two-wheelers that is currently at abysmally low level is expected to increase significantly going forward.
We have developed a statistical model that attempts to forecast the domestic two wheeler sales on the basis of ownership cost and the target population that includes young populace that can afford but do not own a two wheeler. Other qualitative factors like macro-economic outlook, consumer confidence, willingness of vehicle financers to finance TWs, etc. have also been quantitatively built in demand forecasting model.
We foresee the growth of two-wheeler sales to be healthy during the period FY09-14, albeit with some short-term hiccups. Rural India would drive the growth, whereas the opportunity in urban India, especially bigger cities, is limited.
Abundant and low cost labour coupled with local availability of raw materials like steel, aluminium and natural rubber has placed India amongst the low cost producing centres of two-wheelers. Consequently, we anticipate buoyant growth in two-wheeler exports as well.
Table of Contents
I. INDUSTRY SECTION
1.INTRODUCTION
1.1 Classification
1.2 Industry Players
1.3 Evolution of the industry
2.INDUSTRY OVERVIEW
2.1 Characteristics
2.1.1 Consolidated Industry
2.1.2 Short product life cycle
2.1.3 Strong backward linkage
2.1.4 Strong forward linkages
2.1.5 Technology Intensive
2.1.6 Rain dependent demand from rural India
2.1.7 Finance dependent
2.1.8 Duty Structure
2.2 Demand Drivers
2.2.1 Growing consumer class
2.2.2 Demographic transition
2.2.3 Rising proportion of female income earners
2.2.4 Increasing rural focus
2.2.5 TW financing
2.2.6 Wide product portfolio
2.2.7 New Model Launches
2.2.8 Strong Brand Influence
2.2.9 Competition
2.2.10 Product Features
3.TWO-WHEELER MARKET
3.1 Trend of domestic sales of two-wheelers (TW) in last decade
3.2 Segment-wise market share
4.DOMESTIC MARKET
4.1 Segmental Growth Trend
4.2 Motorcycles Sales Growth Trend
4.3 Scooter/Scooterettes (SS) Sales Growth Trend
4.4 Moped Sales Growth Trend
4.5 Electric Two wheelers Sales Growth Trend
4.6 Market share of players in domestic sales
4.7 Players & Products
5.EXPORT MARKET
5.1 Trend of TW Exports
5.2 Player-wise details for FY09
5.3 Segment-wise TW Exports(FY09)
6.COST ANALYSIS
6.1 RM expenses
6.2 Employee expense
6.3 Selling expense
6.4 Operating Margins
II. OUTLOOK SECTION
7.INDUSTRY OUTLOOK
7.1 Domestic Market
7.2 Exports
7.3 Outlook on profitability
III. COMPANY SECTION
8.COMPANY PROFILE
8.1 Hero Honda Motors Ltd. (HHML)
8.2 Bajaj Auto Ltd. (BAL)
8.3 TVS Motor Co. Ltd. (TVS)
8.4 Latest news
IV. ANNEXURE
1. Company wise Motor cycles / step throughs
2. Company wise Scooters/Scooterettes/ Mopeds
3. Segment-Wise Domestic sales-based on engine capacities
4. Segment-Wise Exports-based on engine capacities
5. Company wise Scooter/Scooterettes Domestic Sales
6. Company-Wise Scooter/Scooterettes Exports
7. Company wise Motor cycles/Step Throughs Domestic Sales
8. Company-Wise Motor cycles/Step Throughs Exports
9. Company wise Mopeds/ Electric Two Wheelers Domestic Sales
10. Company-Wise Mopeds and electric TW Exports
LIST OF FIGURES
A. TW Sales Trend (FY04-09)
B. Domestic TW Sales Forecast (FY09-14)
C. Target population, PCI and TW penetration in different regions in India
D. TW penetration in some countries across time periods
1.1 Segment-wise Domestic Sales of TW
1.2 Domestic market share of TW players
2.1 Domestic market share of TW players
2.2 Proportion of female working population in India
2.3 Share of female working in organised industrial activities
3.1 TW unit sales trend
3.2 Segment-wise domestic market share(FY09)
3.3 Segment-wise domestic market share(FY96)
3.4 Category-wise Domestic Market position
4.1 Y-o-Y growth of TW unit sales
4.2 Percentage composition of TW unit sales (FY08)
4.3 Percentage composition of TW unit sales
4.4 TW unit sales distribution in FY09
4.5 TW unit sales distribution in FY04
4.6 Y-o-Y growth of Motorcycles
4.7 Composition of motorcycle unit sales
4.8 Y-o-Y growth of Scooters
4.9 Composition of scooter unit sales
4.10 Y-o-Y growth of Mopeds
4.11 Market share of players in domestic TW sales (FY04)
4.12 Market share of players in domestic TW sales (FY09)
4.13 Market share of players in domestic motorcycle sales (FY04)
4.14 Market share of players in domestic motorcycle sales (FY09)
4.15 Market share of players in domestic scooter sales (FY04)
4.16 Market share of players in domestic scooter sales (FY09)
4.17 Market share of players in domestic moped sales (FY04)
4.18 Market share of players in domestic moped sales (FY09)
5.1 Y-o-Y growth of TW export
5.2 Exports as a % of Total TW sales
5.3 Market Share of Players in TW Exports
5.4 Y-o-Y growth of Motorcycles Exports
5.5 Y-o-Y growth of Scooters Exports
5.6 Y-o-Y growth of Mopeds Exports
6.1 Domestic Steel Prices
6.2 Steel Prices in China
6.3 Aluminium Price Trend
6.4 Natural Rubber Price Trend
7.1 Penetration of TW
7.2 TW Penetration and income levels by regions
7.3 TW Penetration and income levels in top 20 cities
8.1 Share Price Trend of Hero Honda
8.2 Segment-wise sales distribution of Hero Honda
8.3 Share Price Trend of Bajaj Auto
8.4 Segment-wise sales distribution of Bajaj Auto
8.5 Share Price Trend of TVS Motor
8.6 Segment-wise sales distribution of TVS
LIST OF TABLES
A. Segment-wise Domestic TW Sales Forecast
B. Outlook on TW exports
1.1 Production and sales trend for the last 5 years
2.1 Indigenous raw material & components (RMC) as a % of total RMC cost
2.2 Duty structure
2.3 Income Distribution of the Households
2.4 Selling expense as a % of total sales
4.1 Growth in domestic sales for FY09 for each vehicle segment
4.2 Segment-wise growth in domestic motorcycle sales in FY09
4.3 Segment-wise growth in domestic scooter sales in FY09
4.4 Y-o-y growth% of TW sub-segments (FY09)
4.5 Top players in different segments in FY 09 (based on domestic sales)
4.6 Launches in FY09
5.1 Major export destinations (FY08)
5.2 Trend of TW exports (FY04-09)
5.3 Domestic-Export Sales Distribution (FY09)Top players in different segments in FY09 (based on exports sales)
6.1 RM expense as a % of total sales
6.2 Employee expense as a % of total sales
6.3 Selling expense as a % of total sales
6.4 PBDILT margins (%)
6.5 Un-audited results for the period April-December 2008 (9 months)
7.1 Domestic TW sales forecast
7.2 TW exports forecast
8.1 Profile of HHML
8.2 Two-wheeler Product Range
8.3 Profile of BAL
8.4 Two-wheeler Product Range
8.5 Profile of TVS
8.6 Two-wheeler Product Range
LIST OF BOXES
A. Demand Forecasting Model for Domestic TW Sales
B. Corporate action of Hero Honda
C. Strengths and Weaknesses of Hero Honda
D. Corporate action of Bajaj Auto
E. Strengths and Weaknesses of Bajaj Auto
F. Corporate action of TVS Motors
G. Strengths and Weaknesses of TVS Motors
