Indian Auto Industry Update October 27, 2009

automobile energy metal & minerals infrastructure insurance & MF banking
HEADLINES Tuesday October 27, 2009
INDUSTRY Tata Motors profit doubles to Rs 729 cr Tata Motors: dont forget the balance sheet and JLR Douses Nano fire reports Green Reva is red rag for some Americans Reva to rope in franchises for production abroad Bangalore to host auto fair in Nov INTERVIEWS/FEATURES Maruti Suzuki: On a roll Tata Motors: With Manza to steer COMPONENTS Bosch posts 23% rise in profits Sona Koyo Steering Q2 net profit at Rs 3.71 cr Sundaram Clayton Sept quarter net at Rs 4.97 cr Motherson Sumi arm bags Rs 1,400-cr order from European cos Rico staff resume protest, amid vigil ALLIED INDUSTRIES FINANCE & INSURANCE OIL, LUBRICANTS & ALTERNATIVE FUELS Marginal hike in petrol, diesel prices Castrol net profit rises 60% Oil falls to below $80 on recovery concerns	CARS, SUVs, MUVs SX4 relaunched with VVT engine technology Bollywood stars drive Audi sales in India Mahindra first choice wheels COMMERCIAL VEHICLES Toyota's Hino Motors to launch luxury buses in India by Dec Another 1,000 low-floor buses CONSTRUCTION & AGRI MACHINERY 2/3 WHEELERS Bajaj Auto all geared up to go global, says advisor INTERNATIONAL NEWS Honda to boost motorcycle output in Indonesia: report ECONOMY & FINANCE Rupee ends down on month-end dollar demand Sensex ends 70 pts down ahead of RBI policy meet RBI survey lowers growth outlook to 6%
INDUSTRY TATA MOTORS PROFIT DOUBLES TO RS 729 CR The Economic Times (Web & Print Edition) Mumbai: Tata Motors, the worlds cheapest carmaker, doubled its quarterly net profit as it sold more vehicles on improved loan availability and lower tax rates. But, the high level of profitability may not last long as commodity prices are rising, analysts say. The company, which manufactures the Nano cars priced just above a lakh of rupees, said net profit rose 110% to Rs 729 crore for the second quarter, aided by a 17.4% growth in vehicle sales to 1.58 lakh units. Sales of vehicles are picking up again in India and we see recovery in all segments in the coming months, Ravi Kant, vice-chairman of the company said. Automobile sales for most companies, including Maruti Suzuki and Hero Honda Motors, are surging in the nation after the Reserve Bank of India cut interest rate and the Manmohan Singh government cut taxes on products to revive economic growth after the credit markets collapsed last year. These companies were also aided by the slump in the prices of commodities, such as steel and aluminium. The operating profit margin improved by 580 basis points to 13.2% in the quarter, due to lower input costs. The margin is not going to be sustainable ahead because it is on rare occasions that Tata Motors has exceeded a 13% EBITDA margin in the past decade, said M Sabarad, senior analyst of Centrum Broking. There is also an increasing cost risk emanating from a rise in commodity prices. The governments stimulus package is also having an unintended consequence of pushing up commodity prices such as crude, which is about at a year high and steel prices are also rising. Investors are keeping their fingers crossed on whether central bankers, including the Reserve Bank of India governor D Subbarao, will raise cost of funds to fight a potentially high inflation. The RBI will take a decision on interest rates Tuesday. Tata Motors shares rose 1.9% to end at Rs 539 on the Bombay Stock Exchange. Its revenues from operations for the September quarter rose 12.7% to Rs 7,979 crore, even as the excise duty it paid to the government fell 30% to Rs 614.5 crore, from Rs 880.4 crore a year earlier. Marketshare in commercial vehicles rose to 65% from 62% a year earlier. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved" http://economictimes.indiatimes.com/articleshow/5166116.cms Tata Motors net zooms 110% on robust Q2 sales Business Standard (Web & Print Edition) http://www.business-standard.com/india/news/tata-motors-net-zooms-110robust-q2-sales/374409/ Tata Motors Q2 net more than doubles The Hindu Business Line (Web & Print Edition) http://www.thehindubusinessline.com/2009/10/27/stories/2009102751730100.htm Tata Motors quarterly profit more than doubles Hindustan Times (Web & Print Edition) http://www.hindustantimes.com/News-Feed/auto/Tata-Motors-quarterly-profit-more-than-doubles/Article1-469492.aspx Tata Motors profit up on better volumes, margins The Hindu (Web & Print Edition) http://www.hindu.com/2009/10/27/stories/2009102758031600.htm Tata Motors The Statesman (Web Edition) http://www.thestatesman.net/page.news.php?clid=12&theme=&usrsess=1&id=273084 Tata Motors Q2 net doubles to Rs 729 crore The Pioneer (Web & Print Edition) http://www.dailypioneer.com/211546/Tata-Motors-Q2-net-doubles-to-Rs-729-crore.html Tata Motors profit doubles in 2nd qtr Deccan Herald (Web Edition) http://www.deccanherald.com/content/32596/tata-motors-profit-doubles-2nd.html Tata Motors profit revs up 110% in Q2 The Times of India (Web & Print Edition) http://timesofindia.indiatimes.com/business/india-business/Tata-Motors-profit-revs-up-110-in-Q2/articleshow/5166428.cms Tata Motors net doubles on higher operating margins Yahoo India (Web Edition) http://in.biz.yahoo.com/091026/50/baufit.html Tata Motors Q2 net doubles to Rs729 cr mint (Web & Print Edition) http://www.livemint.com/2009/10/26183119/Tata-Motors-Q2-net-doubles-to.html?h=A1 Tata Motors net doubles on higher operating margins The Financial Express (Web & Print Edition) http://www.financialexpress.com/news/tata-motors-net-doubles-on-higher-operating-margins/533572/2 Tata Motors in top gear, 2nd quarter net doubles The Indian Express (Delhi Print Edition) TATA MOTORS: DONT FORGET THE BALANCE SHEET AND JLR Mobis Philipose and Vatsala Kamat mint (Web & Print Edition) Tata Motors Ltds domestic operations have had a quick turn of fortunes. At the peak of the slowdown in end-2008, it had seemed that the company would report losses even in its domestic business. But thanks to a revival in demand and a fall in commodity prices, the company has reported a 144% jump in earnings before interest and tax (excluding other income), to Rs787 crore in the quarter ended September. In the preceding quarter ended June, profit had risen by 61% to Rs488 crore. Operating profit margin improved by 580 basis points on a year-on-year basis, better than the 430 basis points improvement reported in the June quarter. While the companys average price realizations have fallen owing to a shift in the product mix favouring light commercial vehicles, per unit prices have actually been rising. In the core commercial vehicles segment, prices have cumulatively risen by 7-8% in the past year. While commodity prices have corrected from last years highs, the prices hikes have not been rolled back, leading to a jump in profitability. Raw material costs fell by 735 basis points as a percentage of sales last quarter. Of course, the companys measures to cut costs sharply during the slowdown have also helped improve overall profitability. The companys depository receipts listed on the New York Stock Exchange rose by 7.4% after the results were announced on Monday evening. A similar rise when Indian markets open on Tuesday will send the stock (currently at Rs539) within striking distance of its highs of Rs 620 reached a month ago. While there is little doubt that things have turned around sharply for the domestic business, a large part of the companys revenues and profit come from the Jaguar-Land Rover, or JLR, business, which is running losses. The results announced on Monday are for the companys stand-alone operations and dont include JLRs financials. More importantly, Tata Motors has a negative tangible net worth, which is the measure of the physical worth of the company after deducting the value of intangible asses from its balance sheet. At the end of the last financial year, the company had a negative tangible net worth of Rs6,227 crore. This would have reduced marginally because of a further issue of depository receipts worth Rs1,725 crore ($375 million). What this means is that in case of a default, there may not be enough physical assets to recover loans. The company has a high net debt of Rs18,600 crore at the end of September. While cash flows from domestic operations are relatively strong, these will be offset by the cash burn at JLR. Tata Motors shares barely reflect any of these concerns. http://www.livemint.com/2009/10/26225036/Tata-Motors-don8217t-forge.html Tata Motors to clear JLR debt Deccan Herald (Web Edition) http://www.deccanchronicle.com/business/tata-motors-clear-jlr-debt-482# Tatas to be soon free of Jaguar debt The Telegraph (Web Edition) http://www.telegraphindia.com/1091027/jsp/business/story_11663014.jsp DOUSES NANO FIRE REPORTS Business Standard (Web & Print Edition) Tata Motors tried to play down the fire incidents in its small car, the Nano, which were reported from three separate cities. So far, it has dispatched more than 7,500 units of the Nano to its customers and is checking cars yet to be delivered. Ravi Kant, (non-executive) vice-chairman, said: We have identified the cause of fire and its only because of heat and smoke generated in the fire-retardant plastic used in the car. We have changed the supplier and are encouraging customers to check their cars (Nano) with us for any doubts they have. http://www.business-standard.com/india/news/tata-motors-net-zooms-110robust-q2-sales/374409/ GREEN REVA IS RED RAG FOR SOME AMERICANS Chidanand Rajghatta The Economic Times (Web Edition) Washington: The rubber hasnt met the road yet but sparks are already flying. India's electric car Reva is receiving a torrid welcome in US after an announcement last week that it would be manufactured in upstate New York by an American collaborator. ''So our economy is so bad that India is outsourcing to America?'' one New Yorker snippily asked in the local press, after Bannon Automotive, a Long Island electric car firm of uncertain provenance, said it would build Reva's electric cars at a yet to be determined site near Syracuse at an event attended by the governor David Patterson. Bannon is yet to get its financing together and Reva's full board is yet to approve the project, but the fur is already flying over the plan, partly due to what locals see as the states munificence to dodgy entrepreneurs. Paterson has said New York State will provide $6.76 million in incentives, including a $3 million grant and $3.76 million in wage and tax credits, In addition, the federal government is expected to provide $52 million in loans and loan guarantees to Bannon. In return, Bannon will be required to invest at least $26.6 million into the plant over the next three years. Bannon has said that for now production would begin with about 100 employees and increase to 250 when full annual production of 15,000 to 20,000 cars is reached. The first cars will roll out towards the end of 2010. An entry-level, two-seat version of the Reva, which will have a top speed of 50-55 mph and can go 50 miles on a charge, will be priced at about $17,000, Bannon executives said. A higher-end, three-door hatchback version with four seats will be priced at $20,000 to $25,000. Depending on the model, it would have a top speed of 100 mph and could travel up to 120 miles on a single charge. But many New Yorkers, and Americans, are sceptical both about the car and the companies involved, not to speak of their obvious difficulty is accepting a niche Indian company making tracks in the United States. ''Sorry, but if I'm buying a mini car, I'd rather spend my cash on a Smart Coupe. For $13,000 I can get nearly 60mpg, highway speeds, and I don't have to worry about recharging it if I want to go more than 50 miles from home,'' one local wrote in the Syracuse Post-Standard. Not everyone was cynical. Some welcomed the ''foreign'' infusion into a bleeding US economy, speculating where the new plant would be located and whether laid-off local workers could find jobs there, and marvelling at the fact that an Indian company was pitching into the US market. ''Seriously. We have to undo a network of extravaganza that has brought us to our knees. Detroit kept us supplied with our drugs. Reach out to these energy efficient cars and America will stand tall again,'' wrote one New Yorker. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved" http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/Green-Reva-is-red-rag-for-some-Americans/articleshow/5166429.cms Green Reva is red rag for some Americans The Times of India (Web & Print Edition) http://timesofindia.indiatimes.com/business/international-business/Green-Reva-is-red-rag-for-some-Americans/articleshow/5166459.cms REVA TO ROPE IN FRANCHISES FOR PRODUCTION ABROAD Bibhu Ranjan Mishra Business Standard (Web & Print Edition) Bangalore: Electric car manufacturer Reva is planning manufacturing facilities abroad under a franchise model to penetrate those markets. These units will be built under licensing agreements with local partners, wherein the brand name and technology will be owned by Reva. The company, whose head office is here, has sold about 3,400 electric cars so far. It says the licencing agreements will cover not just four-wheelers, but also auto-rickshaws, mini-buses and two-wheelers. We are looking at licence manufacturing opportunities to set up plants in different parts of the world. We are evaluating with several countries and several companies, but it is a little premature. But I would definitely say that in the next six months, we would be able to make our first announcement in that area, Chetan Maini, Chief Technology Officer and Deputy Chairman of Reva Electric Car Company (RECC) told Business Standard. He said the plan to open overseas manufacturing facilities was conceptualised long before, but the company was seeing much revival of interest over this concept in recent days, as many companies and local governments are showing interest at this model. The company is primarily looking at the US, European and Asian countries. Reva will also have an investment partner in those plants, other than owning the brand name and technology. The local partners will have the sales rights, because of their understanding of the local markets. About half the 600-800 electric cars produced by RECC each year are being exported to countries like the UK, Norway, Spain, France, Germany and Costa Rica. The company has sold about 1,000 electric vehicles in London alone, a key market for the company globally, as many as it has sold in Bangalore. It is also erecting a new manufacturing plant close to its existing one in this city, with an investment of Rs 30 crore. Expected to be operational by early next year, the plant is capable of producing 30,000 electric vehicles yearly. Maini said the company had signed up with 24 countries where the company is either selling products or doing a test-launch. With new product launches expected to happen early next year, we will have a presence in several countries in Europe and South America and South East Asia. Asked if there was any plan to go into the electric two-wheeler market, Maini said though the focus was going to be the four-wheeler segment, the same technology could also be test-integrated to two-wheelers. However, he added, we think the two-wheeler market is less technology-oriented, where the brand and the distribution capability hold the key. It requires a lot of investment, whereas the margins are quite low. Its not a business model that we are looking at. Last month, Reva agreed to provide GM its technology for developing an electric version of GMs Chevrolet Spark. Maini said, We chose GM for the small car market, but we are looking at our relationship in a much bigger way. It does not preclude us from addressing segments like three-wheelers or mini-bus. http://www.business-standard.com/india/news/reva-to-rope-in-franchises-for-production-abroad/374438/ BANGALORE TO HOST AUTO FAIR IN NOV Deccan Herald (Web Edition) Bangalore: Unlike many automobile exhibitions, the Auto Mall will not feature concept vehicles. Instead, it will have vehicles ready for purchase, with at least three to four bankers also present at the exhibition, to enable visitors to avail finance. Relio Quick India Private Limited, on Monday announced the dates for their exhibition here. Claiming to be the largest automobile exhibition Relio Quick Auto Mall 2009 is all set to woo the Citys auto aficionados from November 13 to 15 at Palace Grounds. Unlike many automobile exhibitions, the Auto Mall will not feature concept vehicles. Instead, it will have vehicles ready for purchase, with at least three to four bankers also present at the exhibition, to enable visitors to avail finance. After having received a good response, with 14,252 and 18,670 enquiries at Delhi (January 2009) and Chandigarh (March 2009) respectively, the firm is confident of wooing more at Bangalore. While revealing that all major car and two-wheeler brands (about 50) will participate in the event, Relio Quick Managing Director Sandeep Kapoor observed that this will be a unique event which will not be a mere brand showcase exercise, as the onus will be on the buyer. The exhibition will be spread across 70,000 square feet (sqft) and participants will be charged Rs 7,000 per square foot, he said. Further, he said, the firm is looking at organising similar events in 16 locations including Hyderabad and Chennai from February 2010. http://www.deccanherald.com/content/32613/bangalore-host-auto-fair-nov.html
INTERVIEWS / FEATURES MARUTI SUZUKI: ON A ROLL Shobhana Subramanian Business Standard (Compass) Mumbai: Indias biggest car maker has sold a bigger share of more profitable cars and also exported more in the September 2009 quarter. This has pushed the operating profit margin (opm) up by 70 basis points sequentially to 11.9 per cent. With governments offering scrappage incentives, the demand for small cars in the overseas markets was strong and Marutis exports increased 109 per cent year-on-year. That drove the companys top line up by a smart 47 per cent year-on-year. While the export story should continue to fetch profit with about 70 per cent of export revenues now earned from the European markets, the companys focus on rural markets too is paying off. With rural spends less affected by the slowdown in the economy, Maruti was able to sell more cars in the hinterland raising the sales volume in the home market by20 per cent year-on-year. Compared with 12 per cent in 2008-09, analysts estimate that the rural markets now fetch the company approximately 16 per cent of revenues. Business is clearly looking up in urban markets too volumes in the top 10 cities were up 8 per cent in the September quarter, compared with a marginal fall in the June quarter. That apart, consumers are now able to access loans more easily.Currently, about 70 per cent of the sales come through financing schemes, compared with 66 per cent at the end of the June quarter. With the macroeconomic environment now improving, industry watchers estimate that volumes in the home market can grow by about 16-17 per cent in the current year, though the momentum may slow down next year with volumes growing at 12-13 per cent. While there was some concern relating to the sales during the month of September, which were a tad disappointing especially in the home market, some of that was because of production constraints. Nevertheless, models such as SX4, Dzire and Ritz continue to be extremely popular. Also, with the economy now recovering, sales will pick up in the second half of the year. Maruti is expected to grow its earnings per share by about 20-25 per cent in 2010-11. At Rs 1,502, the stock trades at 16 times estimated 2010-11 earnings. http://www.business-standard.com/india/news/maruti-suzuki-onroll/374353/ TATA MOTORS: WITH MANZA TO STEER Rohin Nagrani Business Standard (the strategist) Mumbai: Tata Motors has had a tough year so far in the A3 segment of the car market. Sales have dropped 30 per cent until September. Its market share has shrunk. Rivals like Maruti Suzuki with the Dzire and Ford with the Ikon and Fiesta have shown growth. For Tata Motors President (passenger cars business unit) Rajeev Dubey this should be a sign of worry, but it isnt. The market was anticipating the new Indigo since the start of the year and that meant we lost some volumes. Yet, we averaged about 3,000 units a month in a market that has only shown single-digit growth this year, he says. And hes hinging his bets on the new Indigo Manza to steer things around. Manza, after all, is Italian for steer. For one, the car is priced aggressively. The base variant carried a price tag of Rs 4.8 lakh, ex-showroom, Delhi. This is cheaper than some rivals including the Ford Ikon, Hyundai Accent and Maruti Suzuki Swift Dzire. The last-named is the clear market leader in its segment. It averages over 6,000 units every month. Buyers for some models need to wait for three or four months before the car is delivered. The Manza is being offered with four variants in two engine options petrol and diesel. Both these engines are the same as those inside partner Fiats Linea sedan. With the engines manufactured at the joint venture plant at Ranjangaon, the company hopes to reap the benefits of scaled-up production and pass these on to its customers. Like the Linea, the Manza too has features that are normally the reserve of more premium cars. The top variants of the Manza sport twin airbags, ABS and a Bluetooth-enabled music system called Blue5. The same features are also available on the Linea, which is priced Rs 100,000 more than the Manza. Considering both the cars are sold under the same roof, wouldnt it affect the chances of the Linea? We position the two cars differently, says a Tata Motors dealer on the condition of anonymity. We dont try to sell one product to the other customer and vice-versa because both the customers come from a different set of beliefs and requirements. Still, it will be hard for the ordinary customer to not ignore the differentiation, and cannibilisation to a certain degree is inevitable, as has been seen in the case of the Dzire and SX4 sedans. For Tata Motors, the key challenge has been to improve its position in the market with its new products. Like the Vista, Tata Motors has made huge strides in terms of overall build quality for the Manza and has improved the overall finish of the product. By using proven and reliable engines from Fiat, Tata Motors hopes to banish the thoughts of poor performing products from the minds of consumers once and for all. Whether it succeeds or not is for the market to decide. http://www.business-standard.com/india/news/tata-motorsmanza-to-steer/374333/
CARs, SUVS & MUVs SX4 RELAUNCHED WITH VVT ENGINE TECHNOLOGY The Economic Times (Delhi Print Edition) New Delhi: Maruti Suzuki, has relaunched its premium car SX4 with a new variable valve timing (VVT) engine technology at a price ranging Rs 6.68 to 7.71 lakh (ex-showroom Delhi). Maruti has also introduced an automatic gear version at the price of Rs 8.02 lakh to Rs 8.36 lakh (ex-showroom Delhi). The car was available at the price of Rs 6.2 lakh to 7.27 lakh (ex-showroom Delhi) before its production was stopped in September. SX4 has been losing market share in the mid-size car segment against the Honda City even as the latter carries a higher price tag in the range of Rs 8.37 lakh to Rs 10.24 lakh. While Honda sells over 3,000 City per month in the domestic market, SX4 sales are restricted to mere 500-600 units. Launched in May 2007 SX4 had outplaced City for brief period in the segment with sales of over 3,500 cars in the initial months. With the aim to revive its most expensive car in India, the Maruti has introduced a new 10-spoke 16 inch alloy wheels and a sporty grille in the new car besides making some design cues on the body frame. The new more efficient engine, carries an Automotive Research Association of India certified mileage of 15.6 km per litre of petrol. The new car now will meet the Bharat Stage IV emission norms which will be enforced in April 2010. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved" Maruti unveils new SX4 Deccan Herald (Web Edition) http://www.deccanherald.com/content/32616/maruti-unveils-sx4.html Maruti gives SX4 a facelift The Times of India (Delhi Print Edition) Maruti Suzuki unveils all-new SX4 Business Standard (Delhi Print Edition) Maruti to launch Alto, Wagon R with new engine See this story in: The Tribune (Web Edition) http://www.tribuneindia.com/2009/20091027/biz.htm BOLLYWOOD STARS DRIVE AUDI SALES IN INDIA IANS See this story in: The Economic Times (Web Edition) New Delhi: With clients like Amitabh Bachchan, Shah Rukh Khan and Bipasha Basu, German luxury car maker Audi has a vital target market in Mumbai based film stars and is looking at a 50 per cent growth in India this year. "Quite a few Bollywood stars have picked up Audi cars in India. Whether it is Shah Rukh Khan, Salman Khan, Amitabh Bachchan or Katrina Kaif - each of them has one Audi parked in their garage," Martin Birkner, marketing head of Audi in India, said. "I won't say they make a major market for us, but they certainly are an important market for Audi, at least in Mumbai." According to Birkner, Salman is the latest to buy the car - he bought an Audi A8, while Neil Nitin Mukesh owns Q7, a recently launched SUV by Audi. A Q7 can cost anything from Rs 63 laks to Rs 76 lakhs. An Audi A8 ranges from Rs 71 lakhs to Rs 1 crore in India. Among actresses, Bipasha pampered herself with the luxury vehicle, he said. The company currently offers a bouquet of seven cars, including sedans, SUVs, coupe and sports cars. It is considering launching more models in the coming years. "In 2008, we sold 1,050 cars in India and we have a revised target of 1,600 cars by the end of 2009. We have had considerable growth since last year, so we are projecting a nearly 50 per cent growth this time," he said. He said Asia is fast emerging as a strong customer base for the company but still has time to get used to premium and luxury cars. "We are the segment leaders in Europe and our sales there are currently stagnating. But we see that the Asian region is still not fully developed in the sense that even though there is a huge amount of cars here, not many people go for luxury or premium cars," said Birkner. To promote the brand, Audi India has been partnering with Wills Lifestyle India Fashion Week (WIFW) for the last four seasons. This year they are displaying Q7 and sports car Audi R8, which is one of the most popular models, at the ongoing fashion and luxury event being held at Pragati Maidan here. A toy car, which costs Rs 11 lakh, is also catching people's fancy. Birkner, who has come from Mumbai to attend the event, said WIFW provides an ideal platform for them to meet "right and influential" people who can become potential buyers. "Such events provide a perfect platform to meet people who are interested in premium cars. So we get a chance to build the right contacts here," he said. Earlier this month, Audi organised an amateur golf tournament called Quattro Cup. This was the second tournament sponsored by the company and the finals were held in Hyderabad and the winners will be taken to Sydney in December. http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/Bollywood-stars-drive-Audi-sales-in-India/articleshow/5163151.cms Bollywood stars form Audi's vital target market in India Deccan Herald (Web Edition) http://www.deccanherald.com/content/32503/bollywood-stars-form-audis-vital.html MAHINDRA FIRST CHOICE WHEELS The Tribune (Web Edition) Chandigarh: Mahindra First Choice Wheels, a multi-brand pre-owned car company, opened its outlet in Panchkula on Monday. This is the 10th outlet of the company in North India. Sharad Aggarwal, general manager of the company, said, By 2013, we plan to scale up to 300 dealers and 27 super stores. http://www.tribuneindia.com/2009/20091027/biz.htm
COMMERCIAL VEHICLES TOYOTA'S HINO MOTORS TO LAUNCH LUXURY BUSES IN INDIA BY DEC Business Standard (Web & Print Edition) Chennai: Hino Motors Corporation (HMC), a Toyota Group company, said on Monday it would launch luxury buses for Indian roads by December. The Indian arm, Hino Motors Sales India Pvt Ltd, has also set a target to sell 700-800 units of heavy trucks and buses before March 2010 and plans to double it by next year. Speaking to reporters at Chennai after launching the companys dealership here in association with Kerala-based Popular Group, Amol J Sandil, executive vice-president, Hino Motors, said of the luxury buses: In terms of price, it will match Volvo or it will be plus-Volvo. Hino also launched two truck models, FM8J and FL8J, priced at around Rs 40 lakh, from the Hino 500 series, its fastest selling vehicles in the overseas market. Sandit said the company would import the cabin and chassis in a semi-knocked down (SKD) form from its Thai plant and assemble these at Hinos facility near Bhiwandi, near Mumbai. Asked whether the company would look at setting up a manufacturing facility, Sandil said, We are currently studying (it) and it might take a minimum of at least three years to take a final decision. The company had identified three partners for tippers and one partner for buses and was looking for more partners, he said. It had identified builders for the vehicle body, including Kailash Vahan, Pune, and JCBL. He said the sales target was 700-800 vehicles by March 2010, to be doubled the following year. To support the target, the company is planning to add three more dealers at Maharashtra, Rajasthan and Chandigarh. Currently, it has four dealers. The company is introducing its 500 Series Vehicles, including the FM Range for 6X4 applications and FL Range for 6X2 applications. And plans to launch 8X4 tippers, followed by tractors and trailers. Bodies for tippers, trucks, containerised vans, refrigerated trucks and buses are being assembled in India through building vendors and the company is searching for more vendors, he added. http://www.business-standard.com/india/news/toyota/s-hino-motors-to-launch-luxury-buses-in-india-by-dec/374433/ Toyota's Hino Motors to launch luxury buses in India by Dec Rediff India (Web Edition) http://business.rediff.com/report/2009/oct/27/toyotas-hino-motors-to-launch-luxury-bus-in-india.htm Hino Motors to focus on Indian market The Hindu (Web Edition) http://www.hindu.com/2009/10/27/stories/2009102757961600.htm ANOTHER 1,000 LOW-FLOOR BUSES The Indian Express (Web & Print Edition) After flagging off 160 low-floor buses earlier this month, the Delhi Cabinet decided on Monday to scrap the tender for procuring 1,000 semi-low floor buses. Instead, an order will be placed for another 1,000 low-floor buses. In June, the Cabinet had cleared the proposal to introduce semi low-floor buses in addition to the 2,500 buses being supplied by Tata and Ashok Leyland by March 2010. The difference in the price of low-floor and semi low-floor buses was barely Rs 2.5 lakh. So the Cabinet decided to go ahead and order 1,000 low-floor buses instead of semi-low floor buses, a DTC official said. The difference in semi low-floors and low-floor buses is mainly in height. Most features are same automatic doors, electronic announcement systems and standing space, he said. The tenders we received from Tata and Leyland quoted prices higher than expected. In the fresh batch, the cost of the non-AC green low-floor bus is about Rs 51 lakh. The low-floor AC bus will cost around Rs 61 lakh after tax deductions. http://www.indianexpress.com/news/dtc-fares-to-go-up-from-november-1/533735/2 Floored: tender for 1,000 new buses Hindustan Times (Delhi Print Edition)
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TWO & THREE WHEELERS BAJAJ AUTO ALL GEARED UP TO GO GLOBAL, SAYS ADVISOR Murali Gopalan The Hindu Business Line Mumbai: He is better known as Yamahas turnaround man especially in the context of its remarkable showing in Thailand not-so-long ago. Prior to that, he had spent years in the US market where he learnt the importance of building a motorcycle brand. Mr Tomotaka Ishikawa was, similarly, expected to do an encore in India and pull the Japanese two-wheeler maker out of a morass when he took over as Managing Director in January 2006. He decided to renew the focus on big, powerful bikes, and just when it seemed that Yamaha was settling down to a promising second innings, Mr Ishikawa was summoned back to headquarters in end-2007. He decided to quit instead and less than four months later took over as Advisor to Bajaj Auto. His tenure did not see any remarkable change in market share for Yamaha but his present boss, Mr Rajiv Bajaj, always perceived the company to be the dark house in Indias competitive bike market. Rajivs way of working interested me even while I was in Yamaha. The top management at Bajaj Auto is motivated and talk straight. It is an open culture and within a couple of months into my assignment, I was at home here. One thing that impresses me, in particular, is the focus on R&D and manufacturing, Mr Ishikawa says. According to him, engine technology is the heart of a motorcycle and is not the easiest of things to achieve either. This is what has helped Bajaj especially with bikes such as the Pulsar and the new Discover whose mileage has been so impressive. I told Rajiv that even the Japanese cannot do this. Bajaj has been able to do this without Kawasaki and the DTS-i has been working wonders, he says. The Yamaha veteran says that his job at Bajaj Auto is to support product planning and give advice whenever required. He is keen that the company also be more systematic in terms of not relying excessively on the individual ability of its Managing Director. I do not want Rajiv to tell the time but make the clock. The key is to be more systematic and for people here to carry out 80 per cent of his ability 80 per cent of the time, he adds. It is also his view that targeting the top slot in terms of market share is not the imperative. At Yamaha, if one out of three products was successful, we would be elated. I keep telling Rajiv that his strategy of getting out of the 100cc segment is spot on since market share will come sooner or later. It is not just the mileage but the package and positioning of two-wheelers that is important, Mr Ishikawa says. He believes that Bajaj Auto has the potential to be a strong global player in the coming years thanks to its alliances with Kawasaki and KTM. There are many ways to tackle the global challenge and achieve the stature of a Honda. It does not matter what the brand is so long as it is under the Bajaj Auto umbrella, he adds, citing KTM as a case in point. Interestingly, the former Yamaha boss believes that Japanese bike makers will face their own set of challenges in the future. They went too far on performance and quality standards and may not be able to get back where they started. Some markets do not want that kind of quality but because of the nature of business in Europe or the US, the Japanese have to do it, he explains. On the other hand, as Mr Ishikawa adds, the Chinese only copy and do not have much evolution in technology. Even if they do well in technology, they would not have a brand strategy. They will sell cheap and go. That kind of marketing attitude is no good internationally. http://www.thehindubusinessline.com/2009/10/27/stories/2009102751890300.htm
AUTO COMPONENTS BOSCH POSTS 23% RISE IN PROFITS The Hindu Business Line Bangalore: Automobile component manufacturer Bosch Ltd (formerly Motor Industries Company Ltd) reported a 23.1 per cent in net profit for the September quarter, while revenue increased marginally. For the quarter, net profit was Rs 194.81 crore, compared with Rs 158.20 crore in the year-ago period, the company said in a statement. In the previous quarter it was Rs 188 crore. Revenue increased 2.2 per cent to Rs 1,296.76 crore from Rs 1,268.50 crore in the year-ago period. In the prev ious quarter it was Rs 1,247 crore, it added. During the quarter, other income was Rs 44.43 crore, compared with Rs 21.87 crore in the year-ago period. Shares of the company were down 0.22 per cent and closed at Rs 4,211.10 on the BSE on Monday. http://www.thehindubusinessline.com/2009/10/27/stories/2009102751850300.htm Bosch Q3 Net up at Rs 195 Cr The Indian Express http://www.indianexpress.com/news/bosch-q3-net-up-at-rs-195-cr/533434/ Bosch net up 23% The Economic Times SONA KOYO STEERING Q2 NET PROFIT AT RS 3.71 CR PTI See this story in: The Hindu Business Line New Delhi: Auto component maker Sona Koyo Steering Systems on Monday reported an un audited profit after tax (PAT) of Rs 3.71 crore for the quarter ended September 30. The company had incurred a loss of Rs 7.32 crore in the corresponding period last fiscal, Sona Koyo said in a statement. The un audited net sales during the second quarter also increased by 12 per cent to Rs 200.38 crore from Rs 178.91 crore in the year-ago period, it added. The company attributed its jump in PAT to the resurgent market scenario on the back of increased car sales in the domestic market. Sona Koyo Steering Systems, the flagship firm of the Sona Group, is the country's largest manufacturer of steering systems. http://www.thehindubusinessline.com/blnus/26261710.htm SUNDARAM CLAYTON SEPT QUARTER NET AT RS 4.97 CR PTI See this story in: The Hindu Business Line Mumbai: Automotive components manufacturer Sundaram Clayton on Monday reported a net profit of Rs 4.97 crore for the quarter ended September 30, while it had a net profit of Rs 6.84 crore in the same period last fiscal. Total income of the company stood at Rs 119.67 crore in the latest quarter while it stood at Rs 149.17 crore in the same period previous year, Sundaram Clayton said in a filing to the BSE. http://www.thehindubusinessline.com/blnus/26261721.htm S Clayton net at Rs 5 cr The Economic Times MOTHERSON SUMI ARM BAGS RS 1,400-CR ORDER FROM EUROPEAN COS The Hindu Business Line New Delhi: Motherson Sumi Systems Ltd (MSSL) announced on Monday that its European subsidiary Samvardhana Motherson Refletec (SMR) has received a Rs 1401.8-crore order for supply of rear-view mirrors to two auto companies. This is apart from SMRs earlier orders worth Rs 3,503 crore from Volkswagen and BMW that the company had announced in August. SMR was acquired by auto-component maker MSSL from British firm Visiocorp Plc in March this year. SMR has 16 plants worldwide. The Rs 1,400-crore order is for a period of seven years, which is roughly the life of the vehicle models we are supplying for. Supplies will commence from 2011, when the new models will be launched, said Mr Vivek Chaand Sehgal, Chairman, Samvardhana Motherson Group. To execute this order, SMR will invest about Rs 280 crore in setting up two new plants, besides the expansion of its existing plant in Hungary. According to Mr Sehgal, one new plant will be set up in South Africa, while the other will be in Europe. We have not yet decided the location of the European plant. However, we are working with various governments for incentives, in order to keep our own costs low, said Mr Sehgal. He added that the investments will be funded through internal accruals. Results MSSL announced that its consolidated net profit fell 65 per cent for the quarter ending September 30 to Rs 14.96 crore, from Rs 42.31 in the same period last year. This is mainly due to interest costs, restructuring and currency fluctuations in the quarter. Net sales on a consolidated basis was up two-and-a-half times to Rs 1,587.6 crore from Rs 620.84 crore last year. Domestic sales increased 26 per cent. A lower profit after tax (PAT) is largely because of the restructuring of SMR, which was spread over two quarters and the euro growing stronger, said Mr Sehgal. SMR has spent a total of Rs 40 crore over the two quarters towards restructuring. In August this year, it had closed down one plant in Germany, while another in Australia is expected to be relocated by the end of the year. The company added that SMR has been PBT (profit before tax) positive for the second quarter. Commenting on the demand in the commercial vehicle sector, he said, Although the demand for components from construction equipment manufacturers has gone up in India, its exports have gone down by about 22 per cent. Acquisition plans When asked about possible acquisitions in the near future, Mr Sehgal was positive. We are looking to acquire companies in Europe and North America in the automotive divisions we operate in. Although I cant name them, we are in discussions with a few companies, he said. Mr G.N. Gauba, CFO, MSSL, said that the company in 2005 had set a turnover target of $1 billion by 2010 and will most probably be exceeding this figure at the current rate of topline growth. http://www.thehindubusinessline.com/2009/10/27/stories/2009102751910300.htm http://www.hindu.com/2009/10/27/stories/2009102757831500.htm Motherson net dips 64% on forex,exceptional expenses The Economic Times RICO STAFF RESUME PROTEST, AMID VIGIL The Times of India Gurgaon: The police seem to have taken over the Rico Auto Industries facility in Gurgaon as the protesting workers continue their dharna outside the office. Though top cops keeping a close watch on the protesters maintain deployment is less, almost every floor of Rico has been packed with police personnel. We are here only to avoid any crisis. We have been appealing to protesters not to go against the law and not to carry any sticks with them. So far, there has been no untoward incident and there is no fear either, said ACP (DLF) Sumit Kuhar. The protesters claimed they were baffled by the frequent monitoring of armed cops. It seems to be a pressure tactic so that we call off our peaceful protest. We will sit on dharna till our demands are met. There have been two meetings with the additional commissioner and Rico management. But nothing has progressed , said a member of Rico employees union. Rajan Pandey, vice-president of the association, said there would be another protest march on October 28 in which all trade unions would participate. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved"
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OILS, LUBES & ALTERNATIVE FUELS MARGINAL HIKE IN PETROL, DIESEL PRICES The Times of India New Delhi: Petrol will be costlier by seven paise per litre and diesel by four paise as the oil ministry has raised dealer margins on these motor fuels. The new rates came into effect from midnight Monday, Federation of All India Petroleum Traders chief Ajay Bansal said. He said the quantum of increase will be uniform throughout the country as it will not have any incremental increase in local taxes. Dealers at present get Rs 1.02 as commission per litre of petrol and 63 paise on diesel. Bansal said the increase in fuel prices will come about as dealer margin will be passed on to consumers. Copyright 2009, Bennett, Coleman & Co. Ltd. All Rights Reserved" http://timesofindia.indiatimes.com/business/india-business/Marginal-hike-in-petrol-diesel-prices/articleshow/5165745.cms CASTROL NET PROFIT RISES 60% The Hindu Business Line Mumbai: Castrol India has reported a 60 per cent growth in net profit at Rs 95.6 crore for the July-September quarter on the back of lower oil price and better sales. Sales were up two per cent to Rs 573.8 crore from Rs 565 crore. The business has gained from lower base oil prices, although other key input materials continue to remain at high levels. All this has helped deliver strong bottom line and cash flow. Given the upturn in the economy and the resultant growth of the lubric ant market in India over the next few years, Castrol India will continue to focus and prioritise on its core lubricant product business, said Mr Naveen Kshatriya, Vice-Chairman, in a statement issued on Monday. We expect the economy to continue to gain momentum and with demand revival, we hope to gain volumes. However, as crude has moved up to $80/barrel from its lows of $40/barrel early this year, our raw material prices are hardening and going forward this is likely to impact margins, he said. http://www.thehindubusinessline.com/2009/10/27/stories/2009102750850200.htm Castrol India Q3 profit surges 60% The Indian Express http://www.indianexpress.com/news/castrol-india-q3-profit-surges-60/533455/ Castrol net surges 60% to Rs 95.6 cr The Economic Times Castrol India posts 60% rise in net Business Standard OIL FALLS TO BELOW $80 ON RECOVERY CONCERNS Agencies See this story in: The Hindu Business Line Mumbai: Oil fell for the third day to below $80 a barrel on Monday, extending the previous sessions decline, as investors took profit amid renewed concerns about the strength of the global economic recovery. Buoyed by a rise in global stock indices and a weak dollar, oil prices rallied to a one-year high of $82 earlier last week. But they wobbled and fell late in the week as weak earnings results from the US and a rise in US jobless claims drove investors to reconsider the pace of the economic recovery and its impact on energy demand. US crude for December delivery fell 60 cents to $79.90 by 0123 GMT, after having earlier fallen as low as $79.57. The contract settled down 69 cents a barrel at $80.50 on Friday, squeezing out a weekly gain of 2.5 per cent. London Brent crude fell 62 cents to $78.30. http://www.thehindubusinessline.com/blnus/05261001.htm
INTERNATIONAL HONDA TO BOOST MOTORCYCLE OUTPUT IN INDONESIA: REPORT AFP See this story in: Hindustan Times Tokyo: Japan's Honda Motor plans to invest more than 100 million dollars to increase its motorcycle production in Indonesia in response to growing demand there, a report said on Monday. Honda will spend more than 10 billion yen (109 million dollars) to raise capacity at a factory that it jointly operates with PT Astra International, by 20 percent to 3.6 million units, the Nikkei business daily said. Indonesia is Honda's second-largest market for motorcycles, after India. The expansion of the factory is targeted to begin in 2010, the report said, without naming its sources. A Honda spokeswoman said "nothing had been decided" about whether to expand the motorcycle business in Indonesia. Honda has weathered the global economic downturn better than its two main Japanese rivals, Toyota and Nissan, partly due to brisk demand for its motorcycles, particularly in emerging economies. http://www.hindustantimes.com/business-news/auto/Honda-to-boost-motorcycle-output-in-Indonesia-report/Article1-469281.aspx
ECONOMY RUPEE ENDS DOWN ON MONTH-END DOLLAR DEMAND The Hindu Business Line Mumbai: The rupee ended down 0.30% on Monday, against the US dollar on month-end dollar demand from importers. The rupee finished at 46.64/65 compared with 46.51/52 a dollar on Friday. http://www.thehindubusinessline.com/blnus/05forex.htm SENSEX ENDS 70 PTS DOWN AHEAD OF RBI POLICY MEET PTI See this story in: The Hindu Business Line Mumbai: In lacklustre trading, the Bombay Stock Exchange benchmark Sensex on Monday fell by over 70 points with investors adopting a cautious approach ahead of the RBI monetary policy tomorrow. Market leader Reliance Industries fell over 1 per cent to extend losses for the second day. After moving in a narrow range, the 30-share index dropped 70.31 points to close at 16,740.50. The wide-based National Stock Exchange index Nifty also lost 26.15 points to end the day at 4,970.90. Trading volume declined as investors refrained from enlarging their positions ahead of the Reserve Bank's quarterly monetary policy tomorrow. Fears that the apex bank may signal interest rate hike had a negative impact on the banking and other interest r ate-linked sectors like realty. Blue-chip Reliance Industries fell 1.56 per cent to close at Rs 2,015.45. On Friday, RIL nosedived by 4 per cent after its partner Hardy Oil said it would stop exploring a well for gas in the D9 block off India's east coast. In the 30-BSE index-linked s tocks, 16 closed with losses while 14 ended with gains. http://www.thehindubusinessline.com/blnus/05261901.htm RBI SURVEY LOWERS GROWTH OUTLOOK TO 6% The Hindu Business Line Mumbai: The overall growth outlook has been impacted by the decline in agriculture output on account of the deficient monsoon, the Reserve Bank of India said in the second quarter review of Macroeconomic and Monetary Developments, released on Monday. The RBIs survey of professional forecasters has suggested a downward revision in the growth outlook for 2009-10 from 6.5 to 6 per cent. Contrary to this, the RBIs industrial outlook survey had indicated an expansion in the economy and projections of other domestic and international agencies had also pointed to an improvement in Indias growth outlook. In the ninth round of survey of professional forecasters conducted by RBI in September 2009, the projection for sectoral growth rate for agriculture was revised downwards from 2.5 per cent to -1.4 per cent, whereas for industry the projection was revised upwards from 4.8 per cent to 6.3 per cent. For services, the forecasters suggest modest downward revision from 8.3 per cent to 8.1 per cent. According to the survey, some factors that indicate a faster and sustained recovery in growth include visible signs of industrial recovery such as 5.8 per cent growth in IIP during April-August 2008 as against 3.3 per cent in same period last year, the infrastructure sector showing higher growth of 4.8 per cent in April-August 2009, revival in capital flows in the first half of 2009-10 after two consecutive quarters of net outflows in the second half of 2008-09 and significant recovery in the stock market. Among the downside risks, listed by the survey, are deceleration in growth of private consumption and investment demand, deficient monsoon and drought like conditions in several parts of the country, deceleration in non-food credit growth, negative growth in non-oil imports and weak growth in capital good productions. http://www.thehindubusinessline.com/2009/10/27/stories/2009102751370700.htm Last Financial closing Sensex 16,740.50 US$ spot Rs.46.40 US$ Y.91.816 US$ 6 months Rs.47.45 Yen Rs.0.51 Euro spot Rs.70.07 LIBOR 6 months % Call % GOI sec. 10 years - - - - Aluminium (per kg) Rs. Aluminium Ingot Rs. Copper (per kg) Rs. Gold (10gm) Rs.15,990 Lead (per kg) Rs. Mild Steel Ingots (Mumbai) Rs. Nickel (per kg) Rs. Nickel Cathode Rs. Silver (1kg) Rs.27500 Sponge Iron (per tonne) Rs.14265.00 Steel Flat (per tonne ) Rs. 30710.00 Steel Long GVD (per tonne) Rs. Steel Long BVN (per tonne) Rs. 22920.00 Tin (per kg) Rs. Zinc (per kg) Rs. Zinc Ingot Rs.- - - - Crude Oil (WTI) - - - - Crude Oil (Brent) $78.12 Automobile Scip on BSE Face Value (Rs) Last traded Value (Rs) Apollo Tyres 1 53.55 Asahi Ind 1 68.55 Amara Raja B 2 157.45 Ashok Leyland 1 43.30 Bajaj Auto 10 1459.45 Bharat Forge 2 264.90 Denso 10 94.40 Eicher Ltd 10 - - - - Eicher Motor 10 529.30 Escorts 10 114.75 Exide Ind 1 103.50 Force Motors 10 181 Gabriel India 1 26.95 Hero Honda 2 1594.10 Hind Motors 10 21.80 Hi-Tech Gear 10 100.85 Jay. Bh. Maruti 5 51.20 Jamna Auto 10 53.50 JK Tyres & Inds 10 152.95 Kinetic Motors 10 23.90 Kinetic Engg 10 92.30 KOEL 2 137.50 Kirloskar Br: 2 238.40 LML Ltd 10 9.85 L&T 2 1579.40 Lumax Ind 10 178.55 Lumax Tech 10 60.15 M&M 10 919.95 Maruti Suzuki 5 1517.40 Motherson SS 1 112.20 Minda Inds 10 214.80 MRF 10 5752.40 MICO 10 - - - - Omax Auto 10 52.15 Perfect Circle - - - - - - - - - - Rico Auto 1 24.60 Sona Koyo St 2 17.60 SKF Bearing 10 - - - - SRF 10 209 Swaraj Mazda 10 230 Tata Motors 10 539.35 TVS Motor 1 59.70 Metals Scrip on BSE Face Value(Rs) Last traded Value (Rs) Bhushan Steel 10 1325.30 Essar Steel 10 - - - - Hindalco 1 137 Hind Zinc 10 919.40 Ispat Inds 10 22.70 Jindal Iron 10 - - - - Jindal Stain 2 - - - - JSW Steel 10 814.45 Jindal Steel 5 695.10 National Aluminium 10 358.30 SAIL 10 180.70 TISCO 10 540.55 Visa Steel 1 40