TVS Motor Company expects to grow faster than competitors. Photo: Bloomberg
TVS Motor Company expects to grow faster than competitors in domestic and international markets this fiscal year by launching new products and strengthening operations in key regions, according to CEO KN Radhakrishnan.
He noted that in the domestic market, the company expects the growth momentum to continue with normal monsoons likely to add strength to rural markets.
In international markets, Radhakrishnan expressed hope of performing better in key markets such as Africa this year, while expanding its operations in other regions such as the Middle East and Latin America.
“With our strong product portfolio, unwavering focus on consumers, quality, new products and compelling quality and technology, we are confident that we will outperform the industry both in the domestic and international markets,” Radhakrishnan said in a conference call with analysts.
He noted that the growth momentum is likely to be sustained with the budget focusing on job creation, continued increased commitment to infrastructure and the rural economy.
“We expect rural markets to pick up. With normal rainy season expected, we could see solid growth in the second quarter,” Radhakrishnan said.
He noted that for the first time the company is seeing rural areas performing slightly better than urban markets.
Improved road infrastructure and economic environment will boost demand for two-wheeled mobility, he added.
The two-wheeler segment has a huge opportunity in the medium and long term given the challenges in mobility as well as government investments in infrastructure and road development, he said.
The company, which has spent over Rs 1,000 crore on capital expenditure this year, is gearing up to introduce one product each in the electric and internal combustion engine segments in the current quarter.
A significant proportion of the allocated capital is expected to be spent on new product design and development, Radhakrishnan said.
“I want to highlight that the company will launch an ICE product and an EV product in this quarter and that will further strengthen our product portfolio range,” he said.
Commenting on international business, Radhakrishnan said the Red Sea issue has created challenges in terms of improved transit periods for overseas shipments.
He noted that TVS has taken sufficient countermeasures to mitigate these challenges and the situation is likely to improve in the current quarter.
Select African markets are facing challenges due to currency devaluation and persistent inflation, he said.
“However, given the base effect of our assessment, the likelihood of a further decline in Africa is low. We believe we will do better in Africa this year,” he added.
He added: “Latin America offers us a great opportunity. We have started exporting to LATAM. In Asia, we are seeing some challenges in Bangladesh, but we are hopeful that things will calm down soon.”
The Middle East is also a big opportunity for TVS and the company is strengthening its operations in the region, he said.
In the April-June quarter of this fiscal, TVS Motor Company reported a 6 per cent year-on-year rise in consolidated net profit at Rs 461 crore. Total revenue rose to Rs 10,448 crore in the reporting period, compared to Rs 9,142 crore in the same period last year.
(Only the headline and image of this report may have been reworked by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First published: August 18, 2024 | 10:50 a.m. IS
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