The Hindu Business Line : HMSI to invest Rs 400 cr on capex

Honda Motorcycle and Scooter India (HMSI) on Tuesday said it plans to invest Rs 400 crore over the next two to three years to expand capacity and new product development.

"Our combined capacity of scooters and motorcycles at the existing facility is about 9 lakh units annually. In another two to three years we are aiming to increase it to 1.2 million units," said the HMSI President and CEO, Mr Y. Aoshima.

He said the company would invest Rs 400 crore for the purpose, which will be entirely funded by HMSI through its reserves.

Mr Aoshima added that HMSI was targeting to sell about 7.5-8 lakh units this year up from the 6-lakh units it sold last year. It expects to sell about 5 lakh scooters and 2.5-3 lakh motorcycles.

``In another three years' time our aim is to have an equal amount of scooters and motorcycles sold,'' he said.

The company has achieved sales of one million units of its popular model `Activa' and plans to introduce further models to strengthen its position. "We are looking at launching two variants of our existing two-wheeler model this fiscal," he said, however, declining to disclose any details. The company may also roll out a new bike in the current fiscal. Further, HMSI is also considering the launch of a fuel injection bike in the near future.

Speaking on the labour relations problem at the company's facility, Mr Aoshima said the strike was by the contract workers and it had little impact on production and sales.

"The matter was solved between the contractors and their workers. We are looking ahead," he said. Asked if the firm was looking for synergies with Hero Honda, a joint venture between Honda Japan and the Munjals, Mr Aoshima said the two companies did co-operate in market analysis.

``We do have periodic joint meetings to discuss market focus and analysis and also on the future product line-ups,'' he said.

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