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TVS Motor Company to expand its operations in Eastern India Print E-mail
Written by Satish   
Tuesday, 08 November 2011
Kolkata: The Commerce and Industry Minister, Government of West Bengal, Mr. Partha Chaterjee, handed over to TVS Motor Company and Mahabharat Motors Manufacturing Company, the in-principle permission granted by the West Bengal Industrial Development Corporation Limited for the demerger of the two wheeler business of Mahabharat Motors Manufacturing Company, into a separate company through the court process of demerger.

TVS Motor Company will retain the existing staff and workers of Mahabharat Motors Manufacturing Company and it expects to manufacture initially around 1000 motorcycles per month. TVS Motor Company will also use this facility as a hub to service West Bengal and North East markets.

After the demerger, TVS Motor Company will invest in this new venture subject to approval that may be required by law and Government Regulations.

TVS Motor Company, which had entered into a Memorandum of Understanding with Mahabharat Motors Manufacturing Company, West Bengal in 2008, will thereby take a larger role in the demerged company and facilitate stronger presence in the eastern region of the Indian market.

It may be recalled that as per the MOU, which was signed in 2008, TVS Motor Company was to provide technical support for the manufacturing facility. In addition, TVS Motor Company was to train personnel as per the quality procedures and standards followed at its other assembly plants. The manufacturing facility was created in accordance with the MOU and commercial production commenced in September 2010.

TVS Motor Company currently has three world class manufacturing facilities within India in Tamilnadu, Karnataka and Himachal Pradesh to manufacture two and three wheelers.

TVS Motor Company Q2 Revenue Grows 23%

TVS Motor Company recorded the highest ever retail sales of 2,50,000 vehicles for the Pooja and Diwali season of 2011. This is 20% higher than the same festival season last year. The company witnessed high retail growth during the season which has resulted in significant liquidation of stocks, both at the company and dealer end. Therefore, sales projection for the months of November and December is expected to be above the 200,000 mark per month. The seven day annual maintenance shutdown of the company took place in the month of October 2011, coinciding with Diwali.

The company sold 1,83,718 units in October 2011 against 1,95,271 units in October 2010. Cumulative sales for the period April to October 2011 grew by 12% with sales of 1,324,077 units against 1,184,065 units recorded in the previous comparable period. The company is confident of achieving a 15% plus growth for the current year.

Second Quarter Results

Consistent contributions from a complete product portfolio has enabled TVS Motor Company to record 23% growth in revenue in the second quarter of the current financial year The company's revenues grew to Rs.1992 crore in the quarter ended September 2011 from Rs.1616 crore in the corresponding quarter of the previous financial year.

Profit before tax during the quarter under review grew 49% at Rs.101 crore compared to Rs.68 crore recorded in the comparable period of the previous year. Profit after tax in the current quarter grew at 40% to Rs.77 crore from Rs.55 crore in the previous comparable quarter.

Total two-wheeler sales of the company grew at 16 % in the second quarter of the current fiscal at 5.97 lakh units compared with 5.16 lakh units in the corresponding period of the previous year. Motorcycles sales grew at 15% to 2.41 lakh units in the reporting quarter from 2.10 lakh units in the quarter ended September 2010. Scooters grew at 27% to 1.59 lakh units in the current quarter from 1.25 lakh units during the corresponding quarter of the previous year.

Two wheeler exports registered 31% growth with sales increasing to 0.76 lakh units in the current quarter from 0.58 lakh units in the quarter ended September 2010.

Three wheeler sales during the quarter grew by 19% to 11699 units in the quarter ended September 2011 from 9826 units in the quarter ended September 2010.

During the quarter, PT TVS Motor Company Indonesia registered total two wheeler sales of about 7837 units in comparison with 5315 units recorded in the same period of the previous year.

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