Presentation on Hero MotoCorp ltd Submitted by Prathima H.N
Hero MotoCorp Ltd. Formerly Hero Honda, is an Indianmotorcycle and scooter manufacturer based in New Delhi, India.Hero Honda started in 1984 as a joint venture between Hero Cyclesof India and Honda of Japan. The company is the largest twowheeler manufacturer in India. The 2006 Forbes 200 MostRespected companies list has Hero Honda Motors ranked at #108. In 2010, when Honda decided to move out of thejoint venture, Hero Group bought the shares held by Honda.Subsequently, in August 2011 the company was renamed HeroMotoCorp with a new corporate identity. On June 4, 2012,HeroMotoCorp approved a proposal to merge the investment arm of itsparent Hero Investment Pvt. Ltd. into the automaker. The decisioncomes after 18 months of its split from Honda Motors.
“Hero” is the brand name used by the Munjal brothers for theirflagship company, Hero Cycles Ltd. A joint venture between theHero Group and Honda Motor Company was established in 1984as the Hero Honda Motors Limited at Dharuhera, India. Munjalfamily and Honda group both owned 26% stake in the Company.In 2010, it was reported that Honda planned to sell its stake in theventure to the Munjal family. During the 1980s, the company introduced motorcycles thatwere popular in India for their fuel economy and low cost. Apopular advertising campaign based on the slogan Fill it - Shut it- Forget it that emphasized the motorcycles fuel efficiencyhelped the company grow at a double-digit pace since inception.The technology in the bikes of Hero Honda for almost 26 years(1984–2010) has come from the Japanese counterpart Honda.
Hero MotoCorp has three manufacturing facilities based at Dharuhera,Gurgaon in Haryana and at Haridwar in Uttarakhand. These plants togetherare capable of churning out 3 million bikes per year. Hero MotoCorp has alarge sales and service network with over 3,000 dealerships and servicepoints across India. Hero Honda has a customer loyalty program since 2000,called the Hero Honda Passport Program. The company has a stated aim of achieving revenues of $10 billion andvolumes of 10 million two-wheelers by 2016–17. This in conjunction withnew countries where they can now market their two-wheelers following thedisengagement from Honda. Hero MotoCorp hopes to achieve 10 per centof their revenues from international markets, and they expected to launchsales in Nigeria by end-2011 or early-2012. In addition, to cope with thenew demand over the coming half decade, the company was going to buildtheir fourth factory in South India and their fifth factory in Western India.There is no confirmation where the factories would be built.
Vision The story of Hero Honda began with a simple vision -the vision of a mobile and an empowered India, powered by itsbikes. Hero MotoCorp Ltd., companys new identity, reflectsits commitment towards providing world class mobilitysolutions with renewed focus on expanding companysfootprint in the global arena.Mission Hero Monocarps mission is to become a global enterprisefulfilling its customers needs and aspirations for mobility,setting benchmarks in technology, styling and quality so that itconverts its customers into its brand advocates. The companywill provide an engaging environment for its people to performto their true potential. It will continue its focus on valuecreation and enduring relationships with its partners.
Strategy Hero Monocarps key strategies are to build a robustproduct portfolio across categories, explore growthopportunities globally, continuously improve its operationalefficiency, aggressively expand its reach to customers,continue to invest in brand building activities and ensurecustomer and shareholder delight.
Hero MotoCorp two wheelers are manufactured acrossthree globally benchmarked manufacturing facilities.Two of these are based at Gurgaon and Dharuherawhich are located in the state of Haryana in northernIndia. The third and the latest manufacturing plant isbased at Haridwar, in the hill state of Uttrakhand.
In the 1980s the Company pioneered theintroduction of fuel-efficient, environment friendly four-stroke motorcycles in the country. It became the firstcompany to launch the Fuel Injection (FI) technology inIndian motorcycles, with the launch of the Glamour FIin June 2006.Its plants use world class equipment and processes andhave become a benchmark in leanness and productivity.Hero MotoCorp, in its endeavor to remain a pioneer intechnology, will continue to innovate and developcutting edge products and processes
Products Hero MotoCorp offers wide range of two wheeler products thatinclude motorcycles and scooters, and has set the industrystandards across all the market segments.
The Companys growth in the two wheelermarket in India is the result of an intrinsic abilityto increase reach in new geographies and growthmarkets. Hero Monocarps extensive sales andservice network now spans over to 5000 customertouch points. These comprise a mix of authorizeddealerships, service & spare parts outlets, anddealer-appointed outlets across the country.
BrandThe new Hero is rising and is poised to shine on the global arena.Companys new identity "Hero MotoCorp Ltd." is truly reflective of itsvision to strengthen focus on mobility and technology and creatingglobal footprint. Building and promoting new brand identity will becentral to all its initiatives, utilizing every opportunity and leveraging itsstrong presence across sports, entertainment and ground- levelactivation. 2010-11 Performance Total unit sales of 54,02,444 two-wheelers, growth of 17.44 per cent Total net operating income of INR 19401.15 Crores, growth of 22.32 per cent Net profit after tax at INR 1927.90 Crores Total dividend of 5250% or INR 105 per share including Interin Dividend of INR 70 per share on face value of each share of INR 2 each EBIDTA margin for the year 13.49 per cent EPS of INR 96.54
MILESTONES1983 Joint Collaboration Agreement with Honda Motor Co.Ltd. Japan signedShareholders Agreement signed1984 Hero Honda Motors Ltd. incorporated1985 First motorcycle "CD 100" rolled out1987 100,000th motorcycle produced1989 New motorcycle model - "Sleek" introduced1991 New motorcycle model - "CD 100 SS" introduced500,000th motorcycle produced1992 Raman Munjal Vidya Mandir inaugurated - A School inthe memory of founder Managing Director, Mr. Raman KantMunjal1994 New motorcycle model - "Splendor" introduced1,000,000th motorcycle produced1997 New motorcycle model - "Street" introducedHero Hondas 2nd manufacturing plant at Gurgaon inaugurated
Con……….. 1998 2,000,000th motorcycle produced1999 New motorcycle model - "CBZ" introducedEnvironment Management System of Dharuhera Plant certifiedwith ISO-14001 by DNV HollandRaman Munjal Memorial Hospital inaugurated - A Hospital in thememory of founder Managing Director, Mr. Raman Kant Munjal 2000 4,000,000th motorcycle producedEnvironment Management System of Gurgaon Plant certified ISO-14001 by DNV HollandSplendor declared World No. 1 - largest selling single two-wheeler model"Hero Honda Passport Programme" - CRM Programme launched2001 New motorcycle model - "Passion" introducedOne million production in one single yearNew motorcycle model - "Joy" introduced5,000,000th motorcycle produced
Con…….. 2002 New motorcycle model - "Dawn" introducedNew motorcycle model - "Ambition" introducedAppointed Virender Sehwag, Mohammad Kaif, Yuvraj Singh,Harbhajan Singh and Zaheer Khan as Brand Ambassadors 2003 Becomes the first Indian Company to cross thecumulative 7 million sales markSplendor has emerged as the Worlds largest selling model forthe third calendar year in a row (2000, 2001, 2002)New motorcycle model - "CD Dawn" introducedNew motorcycle model - "Splendor +" introducedNew motorcycle model - "Passion Plus" introducedNew motorcycle model - "Karizma" introduced 2004 New motorcycle model - "Ambition 135" introducedHero Honda became the World No. 1 Company for the thirdconsecutive year.Crossed sales of over 2 million units in a single year, a globalrecord.
Con……Splendor - Worlds largest selling motorcycle crossed the 5million marksNew motorcycle model - "CBZ*" introducedJoint Technical Agreement renewedTotal sales crossed a record of 10 million motorcycle2005 Hero Honda is the World No. 1 for the 4th year in arowNew motorcycle model - "Super Splendor" introduced New motorcycle model - "CD Deluxe" introducedNew motorcycle model - "Glamour" introducedNew motorcycle model - "Achiever" introducedFirst Scooter model from Hero Honda - "Pleasure" introduced2006 Hero Honda is the World No. 1 for the 5th year in arow15 million production milestone achieved2007 Hero Honda is the World No. 1 for the 6th year in arow.
Con….2008 Hero Honda Haridwar Plant inaugurationNew Pleasure launchedSplendor NXG launched with power start featureNew motorcycle model Passion Pro launchedNew CBZ Extreme launched25 million production milestone achievedCD Deluxe launched with power start featureNew Glamour launchedNew Glamour Fi launched2009 Hero Honda Good Life Program launchedHunk (Limited Edition) launchedSplendor completed 11 million production landmarkNew motorcycle model Karizma - ZMR launchedSilver jubilee celebrations
Con…..2010 New model Splendor Pro launched Launch of new Super Splendor and New Hunk2011 New licensing arrangement signed betweenHero and Honda (Hero Honda is renamed as Hero)Launch of new refreshed versions of Glamour, Glamour Fi,CBZ Xtreme, KarizmaCrosses the landmark figure of 5 million cumulative salesin a single year
Hero MotoCorp Ltd.Atul Auto Ltd. Bajaj Auto Ltd.Kinetic Engineering Ltd.LML Ltd.Maharashtra Scooters Ltd.Majestic Auto Ltd.Scooters India Ltd. Sunku Auto Ltd.TVS Motor Company Ltd.
SalesNo matter how huge your order is, HeroMotoCorp shall certainly ensure that it isdelivered efficiently.Advantages of Corporate Sales at Hero: Single window processing for delivery atmultiple locations No running around for documentation Attractive finance options Hero MotoCorp Passport - Unique CRM Program Bulk Incentive Schemes
Our constant endeavor is to support the companys mandate ofproviding highest level of customer satisfaction by taking goodcare of your two-wheeler service and maintenance through ourvast network of more than 2100 committed dealers and serviceoutlets spread across the country. Our state-of-the-art authorized workshops have well laid outstandards for two-wheeler servicing with fully equippedinfrastructure having quality precision instruments, pneumatictools and a team of highly trained service technicians. Havingyour two-wheeler serviced at an authorized workshop ensureshighest standards of service quality and reliability.
Service ScheduleHero MotoCorp offers free services on all its two-wheelers. Youshould avail these services within the stipulatedconditions of time period or km range, whichever condition getssatisfied earlier from the date of purchase. After the completion offree services or its validity period you must continue availing paidservices as per the recommend.Maintenance ScheduleProper care and maintenance are paramount for trouble freeoperation and optimum performance of your two-wheeler.
Strength1. Huge brand equity and one of the biggestplayers in the two wheelers Indian market2. Excellent R&D, and wide variety ofproducts in every segment.3. Excellent distribution, over 3000dealerships and service centers4. Good advertising and excellent rebrandingfrom Hero Honda to Hero Moto Corp
1. Absence in the premium bike segment2.High imports for its spare parts i.e. over 30% imports3. Most of the products have similar features and low ondesign and innovation
Opportunity1.Two-wheeler segment is one of the most growing industries2.Export of bikes is limited i.e. untapped internationalmarketsThreats1. Strong competition from Indian as well as internationalbrands2. Dependence on government policies and rising fuel prices3. Better public transport will affect two-wheeler sales
Most of the Flame, Apache, Pulsar, CBZ & Karizma arepurchased by young generation 18 to 30 years because theyprefer stylish looks and rest of the models of Hero Moto Corp ,TVS and Bajaj are purchased more by daily users who needsmore average of bikes than looks. Hero Moto Corp is considered to be most fuel-efficient bikeon Indian roads.Service & Spare parts are available throughout India in localmarkets also.While buying a motorcycle, economy is the mainconsideration in form of maintenance cost, fuel efficiency.Majority of the respondent had bought their motorcycle morethan 3 years.
Number of products is large in comparison to othersThe distribution policies are more efficient then any othercompany .Hero Moto Corp make more stress on advertisement ontelevision and help there dealers for local advertisement.The pricing policy of Hero Moto Corp (previously HeroHonda) is for better than the pricing policy of thecompetitors.