06 FINANCIAL

HYDERABAD, MONDAY, MARCH 4, 2013

COMPANIES
SMARTBYTES

Warren Buffett Rajesh Kumar Amisha Vora Srikumar Menon

Chairman & CEO Chief Executive Officer Joint Managing Director Managing Director
Berkshire Hathaway MyHiringClub.Com Prabhudas Lilladher Linde India

Ajit Jain’s operation India still needs to pro- A lot of emphasis has Combining The Linde
combines capacity, mote more women for been given on reviving Group’s technology
speed, decisiveness senior management the infrastructure sec- and our strong local
and, most important, level. Presence of tor by announcing new expertise and deep
brains in a manner unique in insurance busi- Women members on board are very low, even projects as well as an infrastructure board to understanding of our customers’ businesses, we
ness. Yet he never exposes Berkshire to risks that it’s below from average percentage of clear disputes hampering the completion of al- will continue to introduce innovative and
are inappropriate in relation to our resources developing countries ready initiated projects technology-led solutions in India

SMARTBOARD Inventory piles up at 2W Tata Motors needs

to tweak passenger
firms after big sales drop car strategy: Slym
Scooter segment sees negative growth for first time in February TAPAN MOHANTA
Press Trust of India
G BALACHANDAR
Chennai Air of pessimism MANDALAY (Myanmar):
In the vibrant passenger
THE Indian two-wheeler ■ During February, Hero saw 4% fall in car segment in India, lead-
industry is bracing up for sales at 501,271 units, while TVS also ing automobile manufac-
more challenging period as reported 4% fall at at 165,696 units turer Tata Motors on Sun-
the demand is weakening day said that there was a
Bloomberg

■ Honda Motorcycle & Scooter (HMSI)

further. Battered by rising India also seems to be hitting lower need to change the compa-
inventory level, companies growth trajectory for its scooters ny’s strategy in the area, a
are offering higher credit top official has said.
limit to dealers and dis- ■ Around 53 per cent of Indian dealers “In passenger cars, we
AirAsia, Tata approach FIPB counts to lure buyers. reported an increase in inventory, post are not in a strong position.
Mending time
Air Asia and Tata group, which proposes to set an During February, the festive season We have lost market share. ■ Company would adopt
airline along with Arun Bhatia of Telestra Trade- country’s largest two-wheel- There are segments that are short, medium and
Bloomberg

■ HMSI to continued growth momentum long-term measures to

place, have sought approval for renting and er maker Hero MotoCorp re-
leasing of aircraft, besides carrying of air freight. ported 4 per cent fall in sales
at 501,271 units, while TVS
Motor also reported 4 per
Judge cuts Apple compensation cent fall at 165,696 units.
Honda Motorcycle &
Apple had a major setback in its mobile patents Scooter (HMSI) India also
battle with Samsung, as a federal judge slashed seems to be hitting lower
a $1.05 billion jury award by more than 40 per growth trajectory for its
cent and set a new trial to determine damages. scooters. Total scooter sales
(domestic plus exports) re-
ported negative growth of 3
Indian consumer market on a high per cent during the month.
India is expected to emerge as the world’s largest However, motorcycles still
consumer market with spending of $13 trillion by reported double-digit rise,
2030, surpassing the likes of China and the US, driven by new launches.
HMSI’s total motorcycle
says a report by Global consultancy Deloitte.
volumes (both domestic and
STB makers eye `4,500 cr sales exports) saw a rise of 31 per
cent in February after post-
Domestic set-top-box makers are eyeing Rs 4,500 ing over 50 per cent growth
crore turnover in the financial year by capturing every month on an average
during the first 10 months
50 per cent market share, as hiking import duty on
of current financial year.
such devices is expected to boost manufacturing. “The industry did stage
some recovery during the
Rolls-Royce targets Germany festival period, but does not
seem to have sustained the
British carmakers Rolls-Royce and Bentley will momentum. High interest
unveil vehicles at the Geneva Motor Show next rates, persistent inflation
week, joining battle in the fast-growing luxury end and delayed monsoon have
of the market on behalf of their German owners. all played their part in
building to a rather poor
Daimler CEO’s last-ditch effort consumer sentiment,” Anil
Dua, senior vice-president
Embattled Daimler boss Dieter Zetsche will this (marketing & sales), Hero
week defend his strategy — and his job — by MotoCorp said.
unveiling a new Mercedes-Benz seen as key to the “Northern region, the
Germany’s premium carmaker’s turnaround. primary growth driver dur-
ing April-December 2012
Compiled from agencies period with 5-7 per cent
growth, is now witnessing
demand pressures since
January 2013, and may see
double-digit decline in Feb-
ruary 2013 (YoY). We esti-
mate average inventory of
five-six weeks with Hero
and Bajaj dealers, four-five
weeks for TVS dealers.
While overall inventory with
HMSI dealers is lower, for
Dream Yuga it is four-five
weeks,” according to a re-
port by Motilal Oswal Secu-
rities, which claimed to
have surveyed over 130 two-
wheeler dealers of major
players across regions.
Around 53 per cent of
dealers reported an in-
crease in inventory, post fes-
tive season. Increase in in-
ventory has been higher for
Bajaj dealers followed by
Hero. Around 44 per cent of
dealers reported higher
credit limit support provid-
ed by OEMs to aid higher
inventory. Moreover, OEMs
are offering discoun-
ts/freebies (38 per cent of
dealers reported) largely in
the form of concessional in-
terest rates through tie-ups
with various lenders and
captive arms.
Major portion of dealers
driven by network expansion, new
launches and capacity addition
surveyed are more con-
cerned on slowdown than
competition. Around 56 per
cent of dealers expect YoY
decline in March sales
across major players, HMSI
being the only exception.
Overall, two-wheeler vo-
lumes are expected to re-
main under pressure over
the near term due to weak
consumer sentiments. Ho-
wever, with expected im-
provement in macroeco-
nomic conditions and con-
sequent revival in con-
sumer sentiments, two-
wheeler industry will recov-
er in FY14.
HMSI to continue its
growth momentum driven
by network expansion, new
launches (another 100-
110cc motorcycle under
Dream series) and capacity
addition, resulting in con-
tinued market share gains.
However, pace of outper-
formance is likely to slow
down in FY14. HMSI has
already reaped the benefits
of low hanging fruits in
FY13 in terms of high wait-
ing period for popular mod-
els (Activa and Shine) and
product introduction into
largest segment (executive
motorcycles, 65 per cent).
For Bajaj, we expect
13per cent volume CAGR
over FY13-15E in domestic
motorcycles driven by new
launches and recovery in
industry growth. Despite
factoring further market
share loss for Hero, the
company may report 11 per
cent domestic volume
CAGR over FY13-15, it said.
On the brand and prod-
uct side, TVS Phoenix 125cc
motorcycle has been receiv-
ing encouraging response.
But due to supply constraint
on disc brake option not able
to fully capitalise currently.
Hero is witnessing higher
sales of HF Dawn/Deluxe, as
there was preference for less
pricey and more fuel-effi-
cient vehicles.
“Weak business senti-
ments have impacted Bajaj
Platina sales as large de-
mand comes from institu-
tional buyers for field work.
Bajaj’s lack of focus on
Platina brand is also anoth-
er reason,” the report said
quoting a North India-
based Bajaj dealer.
balachandarg
@mydigitalfc.com
booming in which we don’t
have products. On new
products, new features, new
launches, we have been
rather quite, we need to
change that,” Tata Motors,
managing director Karl Slym
said on the sidelines of
BCIM car rally here.
Slym said that the com-
pany would adopt short,
medium and long-term
measures to address that.
“In the short-term, and I
am talking in terms of
months, there will be mild
changes. In the medium
term that is a year or a little
more, there will be drastic
changes with new products.
In the long term, there will
be a portfolio revision,” Slym
said. Tata Motors, the vehi-
cle sponsor for the rally from
Kolkata to Kunming, was a
dominant player in the com-
mercial vehicle segment.
“Tata Motors has a major
market share in the com-
mercial vehicle segment at
62 per cent. We are a very
dominant player. It is im-
portant to continue to stay
a leader. Our products and
customer approach is im-
portant to retain leader-
ship,” Slym said. Slamming
the government for raising
excise duties in the budget
on SUVs, Slym said, “The
government believes it can
address shortcomings
■ Firm plans portfolio
revision in passenger
segment, where it has
lost market share
■ Tata Motors has a
major market share in
the commercial vehicle
segment at 62 per cent
gain more revenues by tax-
ing SUVs. The only three
sections doing well in India
are diesel, SUVs and luxury
cars,” he said.
“It’s a shame that it is our
approach. It’s a shame that
instead of trying to grow the
industry, we are trying to pe-
nalise and the one that
seems to satisfy customer
requirements,” he said.
“The government in-
stead of trying to help,
maybe some of the strug-
gling segments, is seeming-
ly trying to stifle some other
segments slightly remain-
ing to be okay,” Slym added.
Slym, who was the for-
mer head of GM India be-
fore joining Tata Motors,
said, “I believe it should be
a free market for fuel any-
way. There should not be
any kind of regulation. So I
am happy for that to hap-
pen (referring to the dereg-
ulation of fuel prices).

Dr Agarwal’s Siyaram enters women’s Audi India Jet Air looks to buy 6 Kingfisher slots
to expand unveils bag
African ops segment with Siya brand collection
PRESS TRUST OF INDIA
Mumbai

WITH the government with-

SANGEETHA G
Chennai
DR AGARWAL’S Eye Hospi-
tal is growing fast in the
SANGEETHA G
Chennai
SIYARAM Silk Mills, known
for men’s fabric and appar-
els, is venturing into the
New venture
■ Siyaram Silk Mills
hopes Siya to become a
`500 crore brand in
MICHAEL GONSALVES
Pune
AUDI plans to sell sporty
and stylish range of bags at
per week), Thailand (21
weekly flights), Nepal
(seven), Bangladesh (14 a
week), Sri Lanka (35 per
drawing Kingfisher Airlines’ week), Hong Kong (14 a
international flying rights week) and Singapore
and domestic slots, the Jet (seven).
Airways has approached the The withdrawal of these
aviation ministry to acquire slots has made available ap-
six of the vacant slots, ac- proximately 25,000 seats
Bloomberg

three to four years per week for other carriers

African continent. Having
opened seven hospitals in
the recent past, now it wants
to add 13 more in two years.
“We are getting a lot of
patients from Africa. Earlier,
West Asia and South Asia
used to contribute to a large
chunk of international pa-
tients and now Africa domi-
nates. Either patient come
on their own or they are re-
ferred by physicians in the
respective countries. Now
we want to make eye care
available at their doorsteps,”
said Amar Agarwal, CMD of
Dr Agarwal’s Eye Hospital.
The African hospitals
will be part of the 60 new
hospitals planned by Dr
Agarwal’s in next two years.
The remaining 40 will be in
India to give the company a
pan-India presence. The
company will invest Rs 400
crore on the new hospitals.
It will be raising the funds
through internal accruals,
debt and private equity.
sangeethag
@mydigitalfc.com
women’s space. The compa-
ny is launching Siya brand of
ethnic women’s wear to start
with. Siyaram hopes Siya to
become a Rs 500 crore brand
in three to four years as there
are hardly any national-level
mass brand in the category.
“We have found that Si-
yaram has considerable
brand value even among
women and we want to cap-
italise on this brand equity,”
said Kishan Poddar, direc-
tor, Siyaram Silk Mills.
According to a brand,” he said. Siya is also
Technopak study in 2011
the salwar kameez/ethnic
women’s wear was Rs
20,690-crore category, grow-
ing at a CAGR of 10 per cent.
Despite the growth poten-
tial, hardly any brand has
evolved in the space because
the manufacturers are large-
ly small and medium com-
panies based in textile hubs
like Surat and Rajkot.
Siyaram will first work on
the distribution of Siya, util-
ising the existing network of
over 500 wholesale distribu-
■ As per Technopak the
salwar kameez/ethnic
women’s wear is
`20,690-crore category
tors and around 60,000 re-
tailers. In six months it will
take up brand building and
marketing of the brand.
“Similar to other brands
of Siyaram, Siya too will be
endorsed by a Bollywood
celebrity. This will increase
the aspirational value of the
simultaneously launched in
overseas markets with signif-
icantly large Indian diaspora
like the Gulf, Bangladesh, Sri
Lanka and the UK.
“In three to four years
we expect the brand to gar-
ner an annual turnover of
Rs 500 crore. Once we con-
solidate our position in the
present segment, we would
also look at extending Siya
to sarees and western
wear,” said Poddar.
sangeethag
@mydigitalfc.com
its authorised dealerships
across India, even as it plans
to increase dealership tally
to 34 by the end of this year.
“The collection is aimed
at offering our customers in
India a luxurious and com-
fortable experience which
will now be a part of the
wide range of merchandise
collection across our deal-
ership network in the coun-
try,” Michael Perschke,
head of Audi India said.
Audi Messenger bags are
price tagged between Rs
5,599 and Rs 7,849; Audi
Backpack at Rs 12,399;
Sports bag at Rs 8,549,
Travel bag at Rs 13,549 and
Garment bag at Rs 15,799.
The rise in input cost,
depreciating rupee as well
as continuous increase in
fuel prices had made the
company re-evaluate its
pricing strategy in India and
increase the prices of its en-
tire model range for this
year earlier, Perschke said.
michaelgonsalves
@mydigitalfc.com
cording to sources.
“We have applied to the to these eight countries.
government to acquire six Interestingly, the
slots from Mumbai. Of SPREADING WINGS: Out of the six slots from Mumbai, Jet has Naresh-Goyal promoted
sought three morning slots and the remaining three evening ones
these, we are looking at Jet Airways is seeking
four domestic and two in- worked out.” The Vijay Mallya-pro- these slots after selling its
ternational routes,” Jet Last week, the govern- moted carrier’s flying li- all three slots at the pre-
Airways sources told PTI ment had withdrawn all do- cence also expired last De- mier London’s Heathrow
here. mestic and international cember, which though can airport to the Abu Dhabi-
Out of the six slots from flying slots of Kingfisher be revived. based Etihad for $70 mil-
Mumbai, Jet has sought Airlines, which remains Besides operating on do- lion last week, in a move
three morning slots and re- grounded since October 1 mestic routes, Kingfisher that may bring its ongoing
maining three evening last, with immediate effect also used to operate to discussions with the Gulf
ones, they said adding, “the and decided to allot them to Britain (seven flights a carrier for stake sale clos-
destinations are being other domestic airlines. week), the UAE (21 flights er to fruition.
No-frill carriers out shopping aircraft
PRESS TRUST OF INDIA aircraft) order to establish a regional further 15 Q400s, however CAPA ex-
New Delhi subsidiary,” the Centre for Asia Pacific pects that the carrier will increase its
Aviation (CAPA) said in a latest report. regional fleet in due course,” the
With government focusing more on im- While all major no-frill carriers — In- study said, adding that GoAir “is also
proving regional connectivity, no-frill diGo, SpiceJet and GoAir — have either considering inducting turboprops to
carriers have started thinking of buying Boeing or Airbus narrow-body aircraft serve tier-II and tier-III cities.”
smaller aircraft with IndiGo even eval- fleet, all of them have started consider- While IndiGo now has around 30
uating launching a regional subsidiary, ing acquiring smaller aircraft like turbo- Airbus A320s from its 2005 order still
an aviation consultancy firm has said. prop ATRs or Bombardier’s Q400s. to be delivered, it will start to take de-
“IndiGo is also evaluating the pos- “SpiceJet remains undecided on livery of the first of its 150 A320neos,
sibility of placing an ATR (turboprop whether to exercise its options for a as well as 30 A320s from 2016-17.