Bajaj Auto prepares to disrupt the motorcycle market in India during peak sales season

A price reduction on Bajaj CT 100 will make it the cheapest motorcycle in India

Mumbai: The motorcycle market in India should experience a new phase of competitive intensity while Bajaj Auto Ltd is preparing to increase its market share. According to badysts, Bajaj's efforts to increase market share are already consuming its profit margins, but the Pune-based company is intractable and has set greater ambitions with aggressive pricing for products, badysts said Mint

Competition is expected to intensify in the coming months with the start of the end-of-year holidays, as demand for consumer goods has traditionally peaked: this year, demand is expected to increase particularly increase in rural areas. In addition to the entry-level segment, including motorcycles with a displacement of up to 100cc, Bajaj also intends to increase its share in the 110-125cc category, Kevin D & # 39; sa, President of Bajaj,

The manufacturer of Pulsar and Discover motorcycles aims to achieve a 20% market share in the domestic market during this fiscal year, he said, and considers that 25% is the largest 39, long-term goal. of the pyramid and bring the share of entry (segment) to 45% to 50% of 33% currently, "he said, adding that new motorcycles of 110-125cc should be introduced in the last quarter of this exercise. [19659004ThursesofthreemonthsoftheBajaj'smarketmaphaspbaded1396%to1627%lastyearintheIndianMotorConstructorsCompany(Siam)

The changing scenario in both segments bodes ill for others such as Hero MotoCorp Ltd., Honda Motorcycle and India Scooter Pvt. Ltd. and TVS Motor Co. Ltd., which sold slightly to Bajaj last quarter.

"The additional market share gains for Bajaj Auto will, of course, be at the expense of competition than the price reductions on the CT (motorcycle), making it the cheapest two-wheeled vehicle in the world. India, expands the addressable market in a material way, "said an badyst who declined to be quoted. Bajaj Auto disappointed investors on July 20 with quarterly results below expectations and expected to experience lower profit margins for the next six to eight quarters, even though there are no further price cuts while cost pressures continue, badysts say.

Sa said the margins would not affect historic levels by 20% for the next two to three years.