TVS Motor 100cc bikes sales fall

Chennai-based TVS Motor Company (TVSMC), is facing falling sales of its 100cc offerings in the market. In the April 2004 to February 2005 period the company sold 4.85 lakh units of its 100cc bikes as against 5.69 lakh sold in the same period the previous year despite the launch of four-stroke TVS Star, the entry level 100cc-model.

Launched in phases throughout India, the TVS Star' is targetted at rural and small town consumers and expected to bring in high volumes as it was positioned at the entry level (Rs30,000) large selling bikes like the Bajaj Boxer and Honda CD-Dawn.

However, TVS Motor's sales are stagnating. The February 2005 sales in the 100cc-segment (including Centra and Victor GX), stood at 43,863 units, lower than 52,363 sold in February 2004.

Industry analysts say the TVS Centra, developed indigenously by the company's R&D wing, which incorporated the fuel-saving patented VTi technology, may be eating up TVS Star's sales. Centra has also, to an extent, been cannibalizing the 110cc Victor GLX.

Company sources say TVS Star would show volumes from April, when it is launched in Maharashtra.

TVS Motor Company recorded a turnover of Rs.815.23 crore in the third quarter ended December 2004 against Rs681.93 crore in the corresponding period last year, a growth of 20 per cent. Profit before tax (PBT) for the third quarter was at Rs.42.18 crore compared to Rs.42.70 crore in the year ago period while profit after tax (PAT) stood at Rs28.23 crore compared to Rs.27.50 crore achieved during the same period last year.