tammina avinash
TRANSCRIPT
-
8/8/2019 TAMMINA AVINASH.....
1/12
By:
TAMMINA AVINASH
MBA 09MO45
-
8/8/2019 TAMMINA AVINASH.....
2/12
-
8/8/2019 TAMMINA AVINASH.....
3/12
` Hero Cycles manufactured Over 16000 Bicycles aday.
` They Sold about86 million bicycles in aggregate as
of 2002.` They had nurtured an excellentnetwork of dealersto serve Indias expansive markets.
` Over the years Hero Group had entered multiple
business areas.
What Was Hero Before JV ?
-
8/8/2019 TAMMINA AVINASH.....
4/12
` HMC initial plans called for both two-wheelermarketand the electric generator market.
` HMC firstchose Kinetic Engineering Ltd. Andformed KineticHondaMotors Ltd. Butthis JVwould work in field of ScootersManufacturing.
` HMC came toHero Group as the Lastcompromise
choice for its motorcycle venture.
Some Facts About Honda
-
8/8/2019 TAMMINA AVINASH.....
5/12
` Its engineering capability
` Relevance and salience ofHERO brand.
` Distribution network.
` Commitmentto Quality.` Know-how and experience in handling large volume
production and distribution.
` Tightfocus on financial and raw material processes.
` Cordial Industrial Relations.
Honda selected the Hero Group for avariety of reasons, which included:
-
8/8/2019 TAMMINA AVINASH.....
6/12
` Honda agreed to provide tech. know-how to HHMand setting up manufacturing facilities. Thisincluded the future R & D efforts.
` H
onda agreed for a lump sum fee of $500,000 & 4%royalty on SP.
` Both Partners held 26% ofthe equity with other26% sold to the public and the restheld to financialinstitutions.
-
8/8/2019 TAMMINA AVINASH.....
7/12
` HHM had grown consistently, earning the title ofthe worlds largestmotorcycle manufacturer afterhaving churned out1.3 million vehicles in 2001.
`
Worlds largesttwo-wheeler manufacturer withannual sales volume of over 2 millionmotorcycles.
` Owns worlds biggestselling motorcycle brand HeroHonda Splendor.
` Over 9 million motorcycles on Indian roads.
` Deep marketpenetration with 5000 outlets.
-
8/8/2019 TAMMINA AVINASH.....
8/12
-
8/8/2019 TAMMINA AVINASH.....
9/12
` The deep penetration network of hero largelybenefited the sales.
` Absence of major competitors in initial years.
` Sound and proven technical capabilities ofHondaand the reliability ofHero.
` Increased marketfor motorcycles: Better Fuel efficiency.
Change in peoples perception.
Decrease in price difference with scooters.
-
8/8/2019 TAMMINA AVINASH.....
10/12
` In August1999, HMC announcedHondaMotorcycle & Scooter India (HMSI) to initiallymake scooters and later, motorcycles as well.HHMs stock plummeted by30% on the day oftheannouncement.
` Possible hike in royalty.
` Competition hotting Up.
` Recovery in the Scooter segment
-
8/8/2019 TAMMINA AVINASH.....
11/12
Thank You
-
8/8/2019 TAMMINA AVINASH.....
12/12
Presented by :
Tammina Avinash