Hero Honda – Investors

In cruise mode
Hero Honda has returned with telling numbers in the December quarter
Business Standard, Thursday, January 15, 2004

Hero Honda has turned in a much better performance in the December quarter, compared with a rather lackluster show in the first half of the year. Sales grew 14.9 per cent to Rs 1,581 crore, on the back of a 26 per cent jump in volumes thanks to the favourable festive season. There continues to be a big difference between the growth rates in volumes and revenues because of a higher proportion of sales of entry-level bikes this year thanks to the success of CD Dawn.

Yet, margins have not been affected-last quarter, operating margin improved slightly by about 50 basis points. This was possible because of a fall in the 'other expenditure' component, for a change. Previously, savings came from raw material expenses, leading to the belief that the company was squeezing its suppliers, who are dependent on Hero Honda for most of their sales. Last quarter, however, raw material costs actually jumped 200 basis points as a percentage of sales. It looks like the inevitable has happened. Higher input costs and a shift in product mix towards lower-end bikes was bound to impact profitability, and this is reflected in the jump in raw material costs. Nevertheless, the fall in other expenditure made up and operating profit increased 18.2 per cent.

Other income, once again, increased sharply by 104 per cent to Rs 44.5 crore or 15 per cent of PBT. But this time around, the increase in other income accounted for about 35 per cent of incremental EBITDA, against 88 per cent in the first half. Importantly, the company has announced a dividend of Rs 10 per share, which would involve a payout of Rs 225 crore (including dividend tax). Given the huge size of the company's coffers, the outflow wouldn't make much difference to the overall cash position.

In the past month, the Hero Honda scrip has been the best performing share in the two- wheeler sector, gaining around 30 per cent in value. This is mainly because the company has gained significant market share in the last quarter, and it looks like it would continue to do so in the near future. The only thing is margins may be under pressure going forward, unless of course it's able to pass on some of the increase in input costs to consumers. This is because of shift in product mix. Besides, the company's only offering in the premium segment, 'Ambition' has been taken off the roads temporarily because of underperformance.

New models spruce up Hero Honda margins
Business Line, Thursday, January 15, 2004

Motorcycle major - Hero Honda has recorded a 33 per cent improvement in post-tax earnings for the quarter ended December 2003. The turnover during this period increased by about 15 per cent to Rs 1,581.4 crore.

Much of the improvement in performance is explained by the success of the latest model launches - Splendor+ and Passion Plus and the entry-level model-CD Dawn. Aided by the success of these models, Hero Honda has managed to post a 27 per cent rise in motorcycle sales volume. The divergence in the growth in volume and turnover reflects that the company's lower end model-CD Dawn has accounted for major part of sales volume. Similar to the trend in the past, the company has managed to record a higher operating profit margin aided by persistent thrust towards cost control.

The operating profit margin increased to 17.1 per cent from 16.6 per cent recorded in the third quarter of the previous fiscal. The post-tax earnings have increased by 33 per cent to Rs 202.7 crore. However, a significant chunk of the growth in post-tax earnings is explained by increase in income from other sources.

The company appears to have cashed in on the recent stock market boom by booking profits on its investment portfolio. As result, the income from other sources has more than doubled to Rs 44.48 crore from Rs 21.78 crore. But for the spurt in other income, the company would have had to contend with relatively modest bottom-line growth of 18 per cent.

Going forward, the demand for motorcycles is likely to remain robust. Any realignment in product mix in favour of higher value products could also have a significant positive impact on performance.

The growing success of higher value models - Splendor+ and Passion Plus - could have an inflationary impact on profitability.

Considering that the recent growth is fuelled by new launches, there is scope for increased indigenisation.

Hero Honda Q3 net rises 33pc; to pay 500% special interim
Business line, New Delhi , Thursday, January 15, 2004

Hero Honda Motors Ltd. the country's largest two-wheeler maker, today said its net profit for the third quarter of the fiscal rose by 33 per cent on robust sales and income from other operations.

Net profit of the company stood at Rs 203 crore for the quarter-ended December 2003 over Rs 153 crore in the same period a year ago. Sales in the period increased by 27 per cent to 5.72 lakh bikes from 4.52 lakh units.

Sales rose 14.5 per cent to Rs 1,581 crore, up from Rs 1,376 crore a year ago. Other income in the quarter went up to Rs 44.48 crore (Rs 21 crore).

Buoyed by the growth, it has announced a special interim dividend of 500 per cent or Rs 10 per share.

For the nine-month period, Hero Honda earned a net profit of Rs 517 crore, up by 20 per cent from Rs 432 crore in April-December 2002. Turnover in the period went up by 8 per cent to Rs 4,273 crore (Rs 3,946 crore).

Sales during the nine- month period stood at 14.77 lakh units over 12.81 lakh a year ago.

Hero Honda net vrooms 33%
The Economics Times, New Delhi , Thursday, January 15, 2004

Thanks to a 27% growth in sales volume and around 2 percentage point improvement in operating profit, the third quarter has turned out to be the best for Hero Honda Motors Ltd (HHML) this fiscal. HHML's profit after tax (PAT) grew 33% to Rs 203 crore during the quarter ended December 31, 2003, against Rs 153 crore in the Q3 of last fiscal. This tally is better than the company's Q1 PAT of Rs 158 crore and Q2 PAT of Rs 156.55 crore.

The company's board of directors declared a special dividend of 500% (or Rs 10 per equity share) for its shareholders.

Hero Honda, which saw its operating margins stagnate all of the fiscal - in fact, it fell by 0.5% in Q2 - has been able to improve it by 2%, taking it to 17% in Q3. Part of the reason is the spectacular volume growth in the quarter which has given the company greater elbow-room with vendors. Also, with the launch of the upgraded Passion and the discontinuity of the discount schemes, the company's marketing costs were tightened. What also helped was working capital management.

Thanks to its new credit policy, HHML managed to bring down receivables from Rs 365 crore in December 2002 to Rs 132 crore in December 2003. It has also brought down its vendor payment period from 52 days to 45 days from November 1, 2003. All this has helped its operating margins, says HHML finance veep Ravi Sud.

The company's sales turnover during Q3 grew 16% to Rs 1,195 crore. The profit before tax went up to Rs 295 crore from Rs 235 crore, registering an increase of 25%.

During the October- December 2003 quarter, HHML sold total of 5,72,196 motorbikes compared to 4,52,050 units in same quarter last year.

For first nine months of the fiscal, the company's PAT increased to Rs 517 crore, a growth of 20% over Rs 432 crore in the corresponding period last year. The profit before tax went up to Rs 761 crore against Rs 664 crore, showing 15% increase.

HHML's net turnover (including other income, net of excise) for the nine-month period grew 8% to Rs 4,273 crore against Rs 3,946 crore in the corresponding period last year.

The company recorded volume sales of 14,77,429 units during the period, showing 15% growth compared to the corresponding period last fiscal.

HERO HONDA QTR. 3 PROFIT UP 33%
Records Superb Performance
New Delhi , Wednesday, January 14, 2004

Hero Honda Motors Ltd, the 'World No.1' two-wheeler company, today announced outstanding financial results for the third quarter and nine months of the current FY 2003-04. The results were announced at the Company's Board Meeting held today.

The company's Profit After Tax (PAT) for the 3rd quarter (Oct-Dec) increased to Rs 203 crore, a growth of 33 per cent over Rs 153 crore in the corresponding period last year. The Profit Before Tax went up to Rs 295 crore up from Rs 235 crore, registering an increase of 25 per cent.

For the quarter, Oct-Dec 2003, Hero Honda registered a outstanding sales increase of 27 % over corresponding period last year (5,72,196 bikes this quarter as compared to 4,52,050 units same quarter last year). In December the company bucked the industry trend registering an increase of 28 % by selling 1,60,191 motorcycles and substantially boosting its market share for the quarter Oct - Dec to 49 %.

The operating margin (EBIDT) for the three-month period stood at an impressive 17.0%, an increase of 2.8% over 16.5% in the corresponding period last FY, reflecting the company's continued success in rationalizing costs through brilliant working capital management, increasing manufacturing efficiency and soaring sales volume.

The Company's Profit After Tax (PAT) for the nine-month period increased to Rs 517crore, a growth of 20% over Rs 432 crore in the corresponding period last year. The Profit Before Tax went up to Rs 761 crore from Rs 664 crore, registering a remarkable increase of 15 per cent.

The Company's total turnover (sales turnover plus other income, net of excise) for the nine-month period grew to Rs 4273 crore, a growth of 8 percent over Rs 3946 crore in the corresponding period last year.

Acknowledged as one of the most shareholder friendly corporate, the company exemplified its corporate philosophy of rewarding its shareholders by yet again declaring a special dividend of 500% (Rs 10 per share).

The company recorded a volume sale of 14,77,429 units during the nine-month period, registering a splendid jump of 15 %, as compared with corresponding period last fiscal (12,81,342 units). Propelled by the success of the new models, the company increased its motorcycle market share, ending the nine-month period with a 47 % market share.

Mr. Brijmohan Lall, Chairman, delighted with the Company's performance, said, "The Company's performance exhibits its intrinsic strength to consistently deliver value to all its stakeholders. I am pleased that our effort to offer the best value for money products and services to our customers have been well received by them, making this success possible."

"Hero Honda has been the benchmark for rewarding shareholders for many years. The Special Dividend is a way of acknowledging shareholders' trust and support to Hero Honda," he added. Mr. Brijmohan Lall also thanked Honda Motor Co., Japan , Hero Cycles and other stakeholders, for their continued support and noteworthy contributions.

Discussing the company's new models' success, Mr. Pawan Munjal, Managing Director, said , "We gained leadership in the economy segment in the second quarter with the successful launch of CD-Dawn. In the third quarter, with outstanding success of Splendor + and Passion Plus, we further consolidated our total leadership in the executive segment. And now, with the latest upcoming launch of Ambition, we shall assume leadership in the premium segment as well."

Hero Honda recently scripted the 'Plus' success story by launching the enhanced variants of their two most successful models - Splendor and Passion. Backed by the successful performance of the two new variants along with CD-Dawn and KARIZMA, launched earlier this year, the company notched world record sales of over 2 lakh units per month in October and November.

During the nine-month period, the company also increased its sales and service network, increasing its dealership base to 524; and sales and service points to 354. In addition the Dealers enhanced their service extensions to 709, taking the total number of authorized service representation to 1587.

Hero Honda Records 15% growth
Bikes touch' 03 finish line with double- digit growth
The Economic Times, New Delhi , Friday, January 02, 2004

In the end, motorcycle growth picked up speed to end calendar 2003 with a modest double-digit growth though the stats are nowhere as heady as 2002. The top two players- Hero Honda and Bajaj Auto- clocked 15% and 12.2% growth in calendar 2003 while TVS clocked 5.1% growth in the same period.

With December sales of 1,60,191 bikes, market leader Hero Honda is up 28% over last December's 1,22,848 units. The company's total year tally of 18,73,632 units is up 14.9% over calendar 2002 tally of 16,30,572 units.

India 's biggest motorcycle maker Hero Honda Motors has maintained its sway over the motorcycle segment reporting a 28 per cent sales growth in December 2003 retailing 1.60 lakh units.

Hero Honda motor's cumulative (April-December) sales went up by 15.3 per cent to 14.7 lakh units from l12.8 lakh motorcycles during the year ago period.

Sales during the third quarter jumped by 27 per cent to 5.72 lakh units from 4.52 lakh units during October-December 200, the company said claiming that it would continue to focus on consolidating its lead in the entry and executive segment, which together form about 88 per cent of the total motorcycle market. The company sold 18.7 lakh units in calendar 2003.

Records phenomenal January sales. Retails expected to cross the 2 lakh motorcycle mark in the month. Growth of 35 % in sales during January 2004.

Continuing with its incredible performance over the past many months. Hero Honda, the 'World No.1' two-wheeler company, has begun the New Year with a leap! While the company sold 1,95,982 motorcycles in January, the retails are expected to be more than
2 lakh motorcycles. This is the third instance in the last four months when the company has come close to, or exceeded the 2-lakh-motorcycle mark.

The company achieved a solid growth of 35% as compared with sales recorded during January 2003.

The cumulative sales of the company for the period April 2003 - January 2004 are 16,73,421 motorcycles, a notable jump from 14,27,052 units sales achieved during the corresponding period last year (April 2002-January 2003). This reflects a growth of 17% in the cumulative sales of the company.

Following the highly successful launches in the past few months, Hero Honda has just strengthened its premium segment range with the launch of Ambition135. It is an ideal model for consumers wanting a combination of contemporary style and power, with good fuel efficiency. Ambition 135 has a styling which is very close to CBZ. It provides the customers a great blend of Style and Power.

Hero Honda is No-1 again, third year in a row. Crosses the 2 million sales mark-
Another World Record
Thursday, April 01, 2004

MARKET SHARE INCREASES BY 3% POINTS

Propelled by the tremendous success of all of the new models launched during the FY 2003-04, Hero Honda - the 'World No. 1' two-wheeler company achieved a new record of over 2 million motorcycles in a single year . The company sold 20,70,157 motorcycles during the year, a phenomenal jump of 23 % over previous year sale of 16,77,537 motorcycles.

In March, the company sold 1,92,181 motorcycles, growth of 66% as compared to sales recorded during the corresponding month last year (1,15,722 units).

MARKET SHARE RISE BY 3% Points
Leading the industry growth almost single handedly, the company would end the year with 47% market share in motorcycles - a remarkable increase of 3 per cent over last fiscal. The company had ended the FY 2002-03 with a 44% market share.

GROWS FASTER THAN THE INDUSTRY, ON A BASE OF 1.68 MILLION UNITS Fortifying its undisputed leadership, the company recorded 23 % sales growth for the full year. As against a 13% sales growth recorded by the motorcycle industry during the first eleven months (April-Feb), Hero Honda grew by 20%.

NEW MODELS - A COMPREHENSIVE SUCCESS
All the five models launched by the company during the year: the entry-level CD-Dawn; Splendor+ and Passion Plus with enhanced styling; the country's first premium sports bike, Karizma; and the restyled Ambition135 were all-round successes.

Mr. Brijmohan Lall, Chairman, Hero Honda Motors Ltd, applauding the company's performance, said, "This new world record of selling 2 million motorcycles exemplifies the potential of the company and the unmatched equity of the Hero Honda brand. It is pleasing to note that the company performed equally well in all the four zones of the country- a unique strength. I would like to take this opportunity to congratulate and thank the entire Hero Honda team, and all our partners and associates, for their invaluable contribution."

Enthused by the world record performance Mr. Pawan Munjal, Managing Director, Hero Honda Motors Ltd., said, "This is a direct outcome of our customer focused strategies. Comprehending the changing customer needs and fulfilling them with matching products has been our core strength. During the year, the company once again demonstrated its intrinsic capabilities. Going forward, we would continue to offer products with the latest technology, styling and performance."

Mr. Atul Sobti, Senior Vice President, Marketing & Sales, Hero Honda Motors Ltd., said, "With the voluminous success of CD-Dawn, Splendor+ and Passion Plus, the company ended the year with an undisputed leadership of the entry and the executive segments - the core of the Indian motorcycle industry. The company also strengthened its position in the premium segment with the launch of Ambition135 .

EXPORTS UP By 72 %
The company increased its exports by 72 %, selling 39,255 bikes in the FY 03-04.

OTHER RECORDS AND ACHIEVEMENTS
The year saw the company recording another astonishing world record - selling over 2 lakh units in a single month, thrice during the second half of the current fiscal.

Hero Honda had recorded superb financial results during the first nine months of the financial year - the full year results will be announced soon. The company's financial performance was globally acknowledged with the company receiving two of the most reputed awards - In the Review 200 Survey 'Far Eastern Economic Review' ranked it third amongst Indian corporates. It also received the Value Creator Award by 'Outlook Money'.

Sells over 2 million motorcycles in 2003-04
Highest turnover in the Indian two-wheeler industry.

Total Turnover for the year up by15 % to Rs 5,997 crore.
Profit After Tax (PAT) for the year increases by 25%
Total motorcycle sales for the year up by 23%; Q4 sales up by 50%
World No.1 for the third year in a row
5 successful model launches drive 4% growth in market share to 48%
Announces 500% final dividend, Total dividend 1000% for the year
Market capitalization crosses Rs 10,000 crore mark

Hero Honda Motors Ltd., the 'World No.1' two wheeler company, today announced outstanding financial results for the year 2003-04, firmly establishing its world leadership for the third year in a row.

The year 2003-04 has been yet another year of landmark achievements for Hero Honda, especially the feat of selling over 2 million motorcycles in a single year, which has not been achieved in the two-wheeler industry so far. With this accomplishment, Hero Honda has been able to double its annual sales of motorcycles, in a short period, from 1 million in 2000-01 to over 2 million in 2003-04.

The company's Total Turnover (sales turnover plus other income, net of excise) grew to Rs 5997 crore, a growth of 15% over Rs 5195 crore recorded in 2002-03. This is the highest turnover ever recorded in the history of the Indian two-wheeler industry.

The company's Profit After Tax (PAT) soared to Rs 728 crore, a growth of 25% over previous year's Rs 581 crore. The Profit Before Tax went up to an impressive four digit figure of Rs 1072 crore, moving up from Rs 885 crore, registering a remarkable increase of 21%.

Widely acknowledged as one of the most investor-friendly companies, the company announced a final dividend of 500%. Thus, with the interim dividend of 500% paid earlier, the total dividend for the year is also a four digit figure of 1000%.

The Operating Margin was an impressive 15.56%, versus 15.52 % in the previous fiscal. The improvement in operating margin reiterates the company's continued and dedicated efforts towards cost rationalization, higher indigenisation, better working capital management and improved manufacturing efficiencies.

The company's volume sale of 20,70,147 motorcycles during the year, marks a splendid jump of 23 % over previous year's sale of 16,77,535 motorcycles.

Buoyed by the tremendous response received by all its new models launched during the previous financial year, the company has ended the year with 48% market share in motorcycles - a remarkable increase of 4 per cent over preceding fiscal. The company's market share in the two-wheeler category has also increased to 37 %, an increase of 4 %.

The performance of the company in the fourth quarter of the FY 2003-04 was also par excellence. The motorcycle sales for the period January - March 2004 grew by a remarkable 50 per cent as compared with the corresponding period in the previous FY. The company sold 5,92,718 motorcycles in the quarter, significantly up from 3,96,193 units sold during January - March 2003.

The Total Turnover of the company for the same period also zoomed 38% from Rs 1248 crore in the fiscal 2002-03 to Rs 1724 crore. While the Profit After Tax during the quarter registered a splendid jump of 42%, from Rs 149 crore during January - March 2003 to Rs 211 crore during the same period, the Profit Before Tax showed an impressive upward trend, growing 41% from Rs 221 crore during the last quarter of 2002-03 to Rs 311 crore during the same period in 2003-04.

Commending the company's excellent performance and the achievement of the 2 million plus sale milestone, Mr. Brijmohan Lall, Chairman, Hero Honda Motors Ltd., said, "This landmark achievement could not have been possible without the excellent support of our esteemed stake holders and customers and especially our very efficient and resourceful supply chain. The support of our partners Honda Motor Co., Ltd., Japan and Hero Cycles Ltd., have greatly helped in our success. It has always been our endeavor to offer enhanced value to our stakeholders by adhering to world standards."

Enthused by the world record performance Mr. Pawan Munjal, Managing Director, Hero Honda Motors Ltd., said, "The key reason for our success has been our continuous pursuit of pro-actively delivering value and delight to our customers. This achievement once again demonstrates our intrinsic capability to comprehend changing customer needs and fulfilling them with matching products. With the voluminous success of CD-Dawn, Splendor+ and Passion Plus, we have ended the year with an undisputed leadership in the entry and executive segments - the core of the Indian motorcycle industry. Ambition135 has strengthened our position in the premium segment."

Talking about the company's future plans, he added, "We are committed to continue our world class performance, by delivering even better value to the customers in the years ahead by offering products with the latest technology, styling and performance. Several new and exciting product launches are lined up for the future."

Honda and Hero Honda Renew
Technical Collaboration Agreement
Wednesday, June 02, 2004

Honda Motor Co. Ltd., Japan , today renewed its Technical Collaboration Agreement with Hero Honda Motors Ltd., one of its most successful two-wheeler Joint Ventures worldwide. The agreement has been renewed for another 10 years, up till 2014.

The Technical Collaboration Agreement was signed today by Mr. S. Toshida, Managing Director and Chief Operating Officer for Regional Operations (Asia and Oceania), Honda Motor Co. Ltd., Japan and Mr.Pawan Munjal, Managing Director, Hero Honda Motors Ltd.

Hero Honda Motors Ltd., had inked an Equity and Technical Collaboration Agreement with Honda in 1984, which was renewed in 1994 and is now renewed for another 10 years.

The Hero Group and Honda own 26 per cent stake each in Hero Honda, which is the world's single largest two-wheeler maker. The remaining shareholding is in the hands of the public.

Addressing the media immediately after the signing ceremony, Mr. S. Toshida said, "Hero Honda has been one of the most successful two-wheeler joint ventures of Honda worldwide and this relationship will only be made stronger and solid.

Further elaborating, he said, "Honda would continue to provide Hero Honda with the latest and most advanced engine technology, with full technical support and assistance for new product introductions and for any other area of our joint operations. Hero Honda will definitely be a core part of Honda's integrated India strategy to develop business in India .

Honda has strengthened its R&D facilities in India and together with R&D in Japan will continue to provide Hero Honda with the Leading Edge Honda Technology."

Mr. Brijmohan Lall, Chairman, Hero Honda Motors Limited said, "Hero Honda is a 'Showcase' of an ideal partnership where both partners have combined their unique strengths and created the 'World No.1' two-wheeler company. The successful relationship that has matured over the last 20 years will continue to grow even stronger."

Elaborating on the New Product strategy front Mr. Brijmohan Lall said, "New models to be introduced have been finalized till the year 2008. In fact Hero Honda will launch two new products this fiscal itself."

New Delhi , July 14, 2004: Sales figures for Hero Honda in the summer of 2004 are good enough to make the torrid heat dissipate. Instead it's the warmth of continuing success that is filling the air, making the World's No. 1 motorcycle manufacturer ride with greater passion in the Indian marketplace. Hero Honda Motors Ltd., the leaders of the two-wheeler market, declared their robust first quarter results for the FY 2004-05, proving once again that Hero Honda bikes are truly the 'desh ki dhadkan.'

Here are the sizzling numbers: Hero Honda recorded a sales volume of 6,09,123 motorcycles during Q1 FY 2004-05, registering a magnificent jump of 33 % over last year's sales during the corresponding quarter (4,58,779 units). May 2004 was even more special for Hero Honda set a new benchmark for the global two wheeler industry, by achieving the highest ever sale of 2,12,177 units in a single month. In fact, in the last nine months, Hero Honda has crossed the monthly sales of 200,000 units five times.

TOTAL TURNOVER (sales turnover plus other income, net of excise) grew to Rs 1745 crore, a significant growth of 28% over Rs 1360 crore recorded in the corresponding period last year. NET SALES (Income from Operations) showed a remarkable growth of 30% over the corresponding period.

PROFIT AFTER TAX (PAT) increased to Rs 190 crore, an impressive growth of 20% over last year's Rs 158 crore. The PROFIT BEFORE TAX went up to Rs 288 crore, registering a remarkable increase of 23% over Rs 234 crore recorded in the corresponding period last year.

OPERATING MARGIN (EBIDT) for the first quarter was an impressive 16.57%, as compared with 16.33% in the corresponding period last year. This marks a further improvement of 1.5%, reflecting Hero Honda's continued success in cost rationalization, improved working capital management and an increase in the manufacturing efficiency through constant innovation.

Mr. Brijmohan Lall, Chairman, Hero Honda Motors Ltd., said, "Our exceptional performance in the last quarter demonstrates our ability to consistently deliver value to all our stakeholders. Setting new benchmarks for the industry is a conscious effort at Hero Honda and with Honda pledging continued support we will continue to lead the way."

Mr. Pawan Munjal, Managing Director, Hero Honda Motors Ltd., also shared his views on the company's performance during the quarter. He said, "Our domination of the two wheeler industry in India has been further intensified in the past nine months. The highly charged growth performance of Hero Honda is a testimony of our customer-centric approach and our incisive understanding of the Indian market. We are confident of maintaining a double digit growth in the coming months."

Hero Honda is currently the market leader in the entry and executive segment of the Indian two wheeler industry with its three models:
CD-Dawn, Splendor - Splendor + and Passion Plus, being the three top selling models in the Indian two wheeler industry. Apart from this, CD-Dawn was recently rated as the best in its segment on Total Customer Satisfaction, in a nationwide survey conducted by TNS Automotives. In the executive segment, Splendor and Passion Plus were also amongst the top.

During the first quarter of the FY 2004 - 05 the company added 1,69,378 new members to its unique CRM initiative - the Hero Honda Passport Programme taking the total number of passport programme members to over 1.5 million.

On June 2, 2004, Honda Motor Co of Japan renewed its Technical Collaboration Agreement with Hero Honda for 2004-2014. As part of this agreement, Honda will continue to provide full and latest technological support to Hero Honda for new product introductions and any other area of their joint operations.

Hero Honda's cumulative sales in August increases by 35%
Wednesday, September 01, 2004

Hero Honda Motors Ltd., the 'World No.1' two-wheeler company is continuing with its robust performance month after month, due to the emphasis laid by it on proactively understanding and satisfying customer needs and desires.

Closely following a uniform price implementation for its model CD Dawn in July 2004, Hero Honda announced a uniform national price of Rs.69, 900 /- for its model Karizma, the country's only 223cc premium sports motorcycle.

August 2004 saw the company sell a total of 1,91,635 motorcycles, thereby registering a splendid increase of 32 per cent in sales over the corresponding month last year. The company had sold a total of 1,45,730 motorcycles in August 2003.

At the end of August 2004, the cumulative sales of the company for the period April - August 2004 stood at 10,06,412 motorcycles, translating into an impressive growth of 35 per cent. The company had sold 7,47,660 motorcycles during the corresponding period last year (April-August 2003).

During the month, Hero Honda extended its co-brand credit card programme with SBI for the Hero Honda Passport Programme members to 12 more cities. The Passport Programme has now, arguably, become the largest Customer Relationship Programme in the country.

The Hero Honda-TERI Green Olympiad, an effort in spreading the commitment to a greener and healthier environment among school students, was held across the country in the last week of the month. Over 70,000 students at 582 centers participated in the examination, which will culminate into a nationally telecast TV Quiz programme called TERRAQUIZ by the end of the year.

The month also saw the seven-member MTV Hero Honda Roadies II team kicking-off their 35-day journey from Victoria Memorial in Kolkata to Wagah Border, covering over 2000 kms. Campus Rock Idols , an attempt by the company to strengthen its association with the youth, progressed successfully with several young music enthusiasts coming forward to participate in the national music competition. The finale, to be held in September, will select the winning college band, which will get a lifetime debut opportunity to perform alongside an international iconic artist.

Hero Honda, the 'World No. 1' two-wheeler company, today announced impressive half-yearly financial results for the period April - September 2004. The results were announced immediately following the company's board meeting held today.

During the first half of the year, Hero Honda continued to demonstrate excellence in understanding the Indian customer by recording astounding sales month over month. The company achieved a total volume sale of 12,23,919 motorcycles during the period, registering a jump of 35 per cent over volume sales in the corresponding period previous fiscal (9,05,233 units). The company crossed the 2 lakh sales landmark four times in the six month period, with the month of September registering the highest ever monthly sale of 2,17,507 motorcycles in the industry.

The company also achieved the landmark figure of selling One Crore motorcycles since its inception.

The company's Profit After Tax (PAT ) during the first half of the current FY jumped to Rs 384.43 crore, a growth of 22 percent over Rs 314.37 crore recorded in the corresponding period during the previous financial year. The Profit Before Tax went up to Rs 583.49 crore, registering an impressive increase of 25 % over Rs 466.63 crore registered during same period during the previous financial year.

Total Turnover (sales turnover plus other income, net of excise) grew to Rs 3543 crore, a growth of 33% over Rs 2661 crore recorded in the corresponding period in the previous year.

The operating margin ( EBIDTA) stood at 16.11%, in spite of increase in input costs and additional taxes. The company, truly complying with its customer centric approach, absorbed all increasing costs during the period, to be able to offer the best value to its customers.

The performance in the second quarter of the FY 2004-05 was equally impressive. The motorcycle sales for the period July - Sept 2004 grew by a remarkable 38% as compared with the corresponding period in the previous FY. The company sold 6,14,796 motorcycles in the quarter, significantly up from 4,46,454 units sold during July - Sept'03.

The Total Turnover of the company for the same period also increased by 38% from Rs 1301 crore to Rs 1798 crore. While the Profit After Tax during the quarter registered a jump of 24%, from Rs 156.55 crores during July - Sept'03 to Rs 194.36 crores in July - Sept'04; the Profit Before Tax showed an impressive upward trend, growing 27% from Rs 232.21 crore in July - Sept'03 to Rs 295.45 crore in July - Sept 2004.

Mr. Brijmohan Lall, Chairman, Hero Honda Motors Ltd., said, "Today, when the Hero Honda family has grown to include over One Crore satisfied customers, I can't help but reflect on our long and fulfilling journey. All through we have, strived to offer our customers the best products and services, and build enduring relationships with all our associates. We feel this achievement is the result of our persistent efforts. I would also like to thank our partners Honda Motor Co. Ltd., Japan and Hero Cycles Ltd., for their continued support."

Mr. Pawan Munjal, Managing Director, Hero Honda Motors Ltd., said, "Yet again, our performance has exemplifies the emphasis we lay, at Hero Honda, on meeting customer needs and desires. The two wheeler market is evolving very fast. We feel, being able to understand the rapidly changing customer requirements is of utmost significance for any company to continue growing. As promised earlier, we would be launching two new models this fiscal, which I am sure will further strengthen our leadership position in the market."

On the occasion of a celebration of achieving One Crore customers and coinciding with the festive season, the company has announced a special mega offer for all its prospective customers - the Hero Honda 'Free2Roam' offer.

Splendor, the world's single largest selling model for over three successive years, continued its dominance, setting a new record of selling 5 million units. To commemorate this achievement, the company has launched a 'Limited Edition Splendor',

As part of its initiatives to provide enhanced service to its customers, the company has facilitated the quickest online insurance policy for all its customers, with the launch of Nsure Plus. The Hero Honda Passport Programme undoubtedly, India 's No.1 CRM programme has now over, 1.5 million members with about 50,000 new additions every month.

Hero Honda Celebrates Twin Milestones -
One Crore Motorcycles and 20 Years of Successful Partnership
Friday, December 10, 2004

Mr. Takeo Fukui, President & CEO, Honda Motor Co. Ltd., Japan visits Hero Honda Plant

Mr. Takeo Fukui, President & CEO, Honda Motor Co., Ltd., Japan, today took part in the celebrations commemorating achievements of cumulative production of One Crore motorcycles and 20 years of Hero Honda - one of its most successful joint ventures. Mr. Fukui presented a special memento to mark the occasion. He congratulated the Chairman, Mr. Brijmohan Lall, other Hero Honda associates and business partners present on the occasion at the Hero Honda Gurgaon Plant.

Welcoming Mr. Fukui and thanking Honda for their superb support, Mr. Brijmohan Lall, Chairman, Hero Honda Motors Ltd, said "Hero Honda is one of the most successful joint ventures within the Honda Group. It is today the world's largest two-wheeler company within all HONDA's group companies. Honda will continue to provide Hero Honda with full and latest technological support and we look forward to an even more robust growth for our company. We have already worked out the new product strategy till 2008."

In the previous fiscal, Hero Honda achieved a record sale of over two million motorcycles, which is the largest production by a local company within the Honda group worldwide. This enabled Hero Honda to retain the largest market share both in the Motorcycle as well as Two-wheeler categories. One of its motorcycle models, Splendor has already exceeded the cumulative production of 5 million, and is the largest selling single name in motorcycle category in the world.

Addressing the gathering, Mr. Takeo Fukui, said, "I believe that the One Crore cumulative production was achieved because Hero Honda's two-wheelers have been well appreciated by the customers in India, and I would like to express my sincere appreciation for all the efforts made by our partner, their associates, dealers and business partners."