Top management of the Chennai-headquartered TVS Motor Company on Wednesday told shareholders that premium products coupled with increased focus on international markets are the key strategies that would drive the company into further growth and profitability. As part of the long-term strategy, the company will be looking at consolidating the African and Latin American markets and utilising its Indonesian subsidiary PT TVS Motor Company Indonesia (PT TVSM) for increased exports to other countries, apart from exploring ways for venturing into other overseas geographies. The company believes that many products in its new BS-VI line up have first-in-class and best-in-class features to attract young customers. TVS Apache, TVS Ntorq and the electric TVS iQube will all help the company to revive demand in the near future.
Addressing the shareholders through a virtual AGM, Venu Srinivasan, chairman, TVS Motor, said that the company has a 23% market in premium segment motorcycles and going forward he does see premiumisation as one of the way to improve the profitability margins both in domestic and international markets. “TVS NTORQ, the premium scooter by us which we are producing 25,000 units a month had grown by 24% while the scooter segment in India had declined by 17%,” he said.
On the long-term vision of the company on the export front, Sudarshan Venu, joint MD, TVS Motor, said that the focus would be on consolidating the market presence in African and Latin American countries as well as to improve presence in some other countries where we have scope for it. “We are also focusing on increasing exports from our Indonesian unit where we make unique products to other countries. We will also consolidate our products which will add to our existing portfolio. I would say in another three to five years, we will be consolidating the international side of our business, increasing market share and entering newer countries,” Sudarshan said.
TVS Motor’s Indonesian plant has made big strides by selling 53,000 two-wheelers in FY20 as against 40,700 units in FY19, registering a growth of over 30%. Under a strategic partnership with BMW Motorrad formed a few years ago, the company had produced over 72,000 units of BMW 310cc motorcycle till date. Similarly, its recent acquisition of UK-based Norton will enhance the company’s global portfolio, bringing in complementary product segments, markets and capabilities. The company also believes that Norton Motorcycles can leverage its additional geographical network reach and global supply chain capabilities to expand to new markets and audiences with existing and upcoming products.
Replying to a shareholder’s query on the rationale behind the company’s investments in a slew of technology start-ups through its Singapore arm, Sudarshan Venu said that the idea was to invest in companies which have related technologies to the company’s automotive business and its subsidiary TVS Credit, a fin-tech company and build intellectual property (IP) in those start-ups as well as in the operating companies of the group. In the second phase, the company will also look to commercialise some of the IPs that have been generated to broader customers and build a business through that.” So, that is the idea, and we are focusing on IoT (internet of things), fin-tech in terms of credit underwritings analytics and couple of other things specifically relating to predictive maintenance within the broader IoT network.
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