This document summarizes trends in the two-wheeler industry in India. It discusses growth trends, with motorcycles dominating but scooters growing rapidly. Hero MotoCorp maintains the largest market share but is losing to Honda. Input costs are decreasing due to localization while scooter and premium motorcycle segments are growing. Executive and economy motorcycles remain the largest segments.

1. TWO WHEELER
MARKET

2. AGENDA
• Growth Trends In Two Wheeler Industry
• Segment Wise Change In Domestic Market
• Player Wise Scenario
• Growth Trends In Domestic Motor Cycle
• Player Wise Sales Review
• Economy Segment Player Wise Domestic Share
• Growth Of Two Wheeler Industry And Scooters
• Executive Sub Segment
• Trends In Cost Structure
• Localization Gaining Strength

3. GROWTH TRENDS IN TWO WHEELER INDUSTRY
13.6
34.3
29
0
7.3
17.9
26 25.6
13.9
2.9
6.5
8.1
0
5
10
15
20
25
30
35
40
1 2 3 4 5 6
growth in exports growth in domestic sales
Two wheeler industry
•Revenue- 755b
•Sales Volume -18m Units
•7.9% CAGR- Motorcycle
•25.2% CAGR - Scooters

4. SEGMENT WISE CHANGE IN DOMESTIC MARKET
0
20
40
60
80
100
120
140
160
2013-14 2014-15
MOTORCYCLES MOPEDS SCOOTER
70.8
67.1
4.9
4.7
24.3 28.2
Motor cycles dominate 2 wheelers industry – 2/3 total market share
Scooter - gender biased positioning
Mopeds - demand decreased from Tamilnadu and Andhra

5. PLAYER WISE SCENARIO
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2013-14 2014-15
OTHERS
TVS MOTOR
BAJAJ AUTO
HMSI
HERO MOTO CROP
41.3 40.2
24 26.6
14.2
11.1
11.8 13.2
0.7 0.9
Hero- dominate market share - poor product portfolio, lack of new model
HMSI – second position – model launches in executive and premium motor cycles
TVS surpassed Bajaj – absence of scooter segment , poor product mix

6. GROWTH TRENDS IN DOMESTIC MOTOR CYCLE SALES
25.8
22.9
11.7
0.1
3.9
2.5
26
25.6
13.9
2.9
7.3
8
0
5
10
15
20
25
30
1 2 3 4 5 6
GROWTH OF MOTORCYCLE
SEGMENT
GROWTH OF TWO WHEELER
INDUSTRY
Domestic motor cycle sales (67% of total 2 wheeler industry)
Grew 2.5% against industry 8%
Weak sales in rural areas – 46%
CAGR - Exports – 15.3% , domestic – 7.9% , total motor cycle – 9%

7. 1.2
2.1
4.8
3.1 3
3.27.3
11.8
16.47
5.5
6.2
26.8 24.4
16.5
54.6 53.2 52.9
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010-11 2012-13 2014-15
PLAYER WISE SALES REVIEW
others Yamaha Motorw HMSI TVS Motors Bajaj Motors Hero MotoCorp
 Hero lead the segment ( competition from HMSI)
 Bajaj lost its market (despite launching new models and variants)
 TVS lost 3rd position to HMSI- lack of wide range and poor sales volume

8. ECONOMY SEGMENT
PLAYER WISE DOMESTIC SHARE
24.7
46.4
27.2
1.6
24.9
53.2
20.2
1.7
25.1
57.8
15.8
1.3
0
10
20
30
40
50
60
70
Bajaj Auto.Ltd Hero Moto corp Ltd T.V.S Motor Company Indian Yamaha Motor Pvt.Ltd
2010-11 2012-13 2014-15
 Hero leads in economy segment
 18-20% share in motor cycle segment
 Demand- semi-urban areas and rural

9. 0.8
66.5
21.2
9.2
1.3
62.6
20.2
14.6
2.2
66.3
8.4
5
0 10 20 30 40 50 60 70
OTHERS
HERO MOTOCORP
BAJAJ AUTO
HMSI
EXECUTIVE SUB-SEGMENT
2014-15 2012-13 2010-11
Hero leads in executive sub- segment too. (splendor and pleasure)
HMSI- market share 15% - (dream yuga, dream neo)
Bajaj lost (8.4%) ,

10. 48.2
20.4
10.9
8.7
40.6
16
14.1
7.4
35.9
8.2
16.2
10.3
0
10
20
30
40
50
60
Bajaj auto ltd Hero Moto Corp ltd India Yamaha Motor pvt.ltd TVS Motor Company Ltd
PREMIUM SUB SEGMENT
PLAYER WISE DOMESTIC MARKET SHARE
2010-11 2012-13 2014-15
Bajaj loses market share but maintains Leadership – 36% Market Share
Bajaj Re-launched Pulsar Range
18.5% To Domestic Motorcycles Sales Volume
Royal Enfield- Second Largest Player – 16.2% ( sales growth 45% CAGR)
TVS- APACHE

11. GROWTH OF TWO WHEELER INDUSTRY AND SCOOTERS
27.6
40.7
24.4
14.2
23.2
25.1
26
25.6
13.9
2.9
7.3 8.1
0
5
10
15
20
25
30
35
40
45
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
Growth in Scooters
Growth of Two wheeler
industry
 Scooter Sales CAGR – 25.2% (2009-15)
 Demand- Ungeared Scooters
 Share of scooters in total domestic two wheeler sales- 28.2%

12. TRENDS IN COST STRUCTURE
0
10
20
30
40
50
60
70
80
90
100
2009-10 2010-2011 2011-12 2012-13 2013-14 2014-15
69.4 73.1 74 73.7 71.5 71.7
3.7
3.4
3.3 3.7 4 4.54.8
4.2 3.2 3.8 4.3 4.55 4.3 3.6
4.2 4.6
5
17.1 15 15.9 14.6 15.6 14.3
Trendsincoststructure
(percent)
Raw material cost Employee Costs Other Manufacturing Expenses Selling Expenses Operating Margins
Value engineers, vendor and workforce rationalization localization
Raw materials- economic crisis (steel and aluminum prices)
Employee – 4.5%( higher 10yrs)
Advertising expense – 20.5% , Marketing and distribution- 22.9%,
Selling and distribution = 21.9%

13. 98.3
95.8
96.1
94.2 93.6 94
96.4
95.4
95.6 95.4 95.7 95.7
89.8
89
87.4
86.2
85.5 85.6
96
95 95
94
93 93
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
85
87
89
91
93
95
97
99
Hero MotoCorp Bajaj Auto TVS Motors Industry Indigenisation
LOCALIZATION GAINING STRENGTH
Localization level – 96.97% (reduce costs)
Import technologies for newer models ( localization level )