HMSI ties-up with PNB for vehicle finance

Company expects boost in rural sales

Honda Motorcycle and Scooter India has tied up with Punjab National Bank for vehicle finance as the two-wheeler maker eyes greater penetration in the rural and semi-urban regions across the country.

The company, which gets around 30% of revenues from rural and semi-urban areas, expects a boost in sales as around 40% of the PNB's total 6,340 branches are located in the rural, semi-urban areas.

"With over 4,000 of PNB's branches in semi-urban and rural areas, the tie would help us to sell two-wheelers including mass segment Dream Series bikes in these regions," HMSI Vice President, Sales & Marketing YS Guleria told reporters here.

The tie-up with PNB, which has a customer base of around 8.9 crore coupled with attractive loan schemes, would help the company enhance retail finance for its products, he added.

The company, which has been looking to enhance its rural footprint, sells three mass segment Dream series bikes -- Dream Yuga, Dream Neo and CD 110 Dream.

When asked about the company's plans for the upcoming festive season, Guleria said: "This year we are targeting to sell the double of units which we sold last year during the period."

The company had sold 4.5 lakh units in the festival season last year.

On new launches and refreshed models during the festive season he said the company has already launched new products in last few months and there is no plan for further product launches during the period.

He, however, confirmed the launch of an all new 160-cc bike before the end of the year.

"It will come during this calender year with a completely new engine," Guleria said, without sharing further details.

The company, which sold around 3.7 million two-wheelers last fiscal remains positive to sell 4.5 million units during this fiscal.

"With the commissioning of the Gujarat plant and the addition of another 1.2 million capacity, our immediate challenge would be to develop the back-end to sell these additional 1.2 million units," Guleria said.

The new unit would manufacture scooters only to start with so as to cater to the rising demand, he added.

The company, which has three manufacturing facilities, would enhance its total production capacity to 5.8 million units with the commissioning of its Gujarat plant. The new plant is expected to be operational in early 2016.

HMSI is also looking to add another 1,000 touch points across the country thereby taking the total number to over 3,800 by the end of the current fiscal.