DEPARTMENT OF PROFESSIONAL &DEVELOPMENT

JAYPEE INSTITUTE OF ENGINEERING & TECHNOLOGY,

A-B ROAD, RAGHOGARH, Dist. GUNA - 473226, M.P., INDIA

SUBMITTED TO:

MR. SANDEEP SRIVASTAVA

SUBMITTED BY:

SHANTANU KUMAR SINGH

CSE-2C(06290G)

ACKNOWLEDGEMENT

I hereby regard my sincere thanks to Mr.Sandeep Srivastava, JIET Guna under

whose guidance this project was undertaken.

I would also like to thank my friends who have so generously helped me.

Index

➢ INTRODUCTION

➢ EXECUTIVE SUMMARY

➢STYLISH BIKE MARKET OF INDIA:-

➢ REASONS:

➢PEST ANALYSIS:----

•1-POLITICAL

•2-ECONOMIC

•3- SOCIAL

•4-TECHNOLOGY CHANGE

•5-INFRASTRUCTURE

➢INDIAN BIKE INDUSTRY

➢INDIAN INFRASTRUCTURE

➢ EXISTING NETWORKS

•NATIONAL HIGHWAY

•EXPRESSWAY

➢ BOOSTING OF INFRA CHANGE’S (GOVERNMENT STEPS)

 ➢ KEY ISSUES AND CHALLENGE’S

➢CONCLUSION

INTRODUCTION:-

In 1955, the Indian government needed sturdy and reliable motorcycles for its Army and police to patrol the rugged border highways. The first batch of 350cc Bullet from the Royal Enfield Company of UK were received and assembled at Chennai.

The four stroke engine of the motorcycles is fuel efficient and is the main reason for the growth of motorcycle segment In India. The motorcycle market share is about 81.5% of the total two wheeler market in India. Three-fourths of the total exports in the two wheeler automobile industry are made in the motorcycle segment. Exports are made mainly to South East Asian and SAARC nations.

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Bikes are the major segment of Indian two wheeler industry, the other two being scooter and mopeds. Indian two wheeler companies are among the biggest two wheeler manufacturers in the world. Hero Honda is the numero uno bike manufacturer in the world with Bajaj India gives it a close chase.

EXECUTIVE SUMMARY:- The Indian bike lover’s dream seems to be coming true. Speed enthusiasts ogling superbikes in glossy magazines could now call these mean machines their own, as niche players such as Harley-Davidson and Ducati ride into the country to join the major global brands present here. The bikes do not come cheap; these niche brands are priced well above most mid-size cars, yet the companies remain bullish about the market.

In the last two years, major bike makers such as Yamaha, Honda, Suzuki and Kawasaki have launched their premium range in the country.Last week, Fiat-owned specialised bike manufacturer Ducati set up its first shop in India. With bikes priced between Rs 9.6 lakh and Rs 43.37 lakh, Ducati aims to open six showrooms by 2010.

One of the oldest bike manufacturers in the world, US-based Harley-Davidson aims to announce its range and pricing for India at the Auto Expo in January. “We will be launching our dealerships initially in five cities and have already got about 80 applications for it,” said Mr Sanjay Tripathi, Director – Marketing, Harley-Davidson India. The company will also be starting the Harley Owners Group (H.O.G.) in the country. Popularly referred to as the H.O.G. world over, the owners’ association would organise cross-country adventure rides.

Yamaha was the first to step into this market with its 1,000 cc superbike R1 and the 1,700 cc sports bike MT01 in December 2007. Priced at Rs 12.5 lakh, it has sold about 150 units till date. It launched the 1,700 cc V-MAX in August this year, priced at Rs 20 lakh.

“We have been out of stock for the last three months for both the R1 and the MT01,” said Mr Pankaj Dubey, National Business Head, India Yamaha Motors Ltd.

Suzuki entered the market with the Rs 12.5-lakh Hayabusa and Intruder in November last year. According to Mr Atul Gupta, Vice-President – Sales and Marketing, Suzuki Motorcycle India, it has sold 105 units to date.

Kawasaki, in partnership with Bajaj Auto, has launched the Ninja 250R. The bike, at 250 cc, is a sobered down version of its much more powerful namesakes sold abroad. At Rs 3 lakh, it is much more affordable, but doesn’t quite qualify in the superbike range. Assembled at Bajaj’s

Chakan plant, it has sold about 127 units. The company also has plans to bring in KTM bikes with capacities of above 690 cc.

Adding to the appeal

STYLISH BIKE MARKET OF INDIA:-

REASONS:-

PEST ANALYSIS:----

1-POLITICAL

The political environment in the world has been changing abruptly in the previous year. Bike companies being an integral part of this economy have also been greatly affected by these changes and have not been able to counter them. Changes in the legislation and laws of the govt have tried to revive the bikes business but the reciprocations have been less then what was expected. The company has been able to beat the expectations of experts who predicted more dip by posting fewer losses by cutting costs. The conservatism that exists in the consumer spending has been increasing which has adversely affected companies’ performance. Issues of environment policies has also affected companies’ came under significant pressure from environmental groups across the world to assume responsibility for its old products and this experience sensitized company officials to the risks and opportunities of state and federal -waste regulations and the need to take proactive steps against them.

2-ECONOMIC

last few years This has encouraged significant growth in Indian business industry. The exponential growth of the industry can be ascribed to factors such as higher Purchasing capacity of average Indians has increased spectacularly in the disposable income resulting in more financial capacity and availability of cheap consumer financing. Over the years, the market dynamics of the industry has also changed. Majority of the customers now go for the niches bikes. Increase in nap & gap play a major role in bike markets.

3- SOCIAL Increase of younger population and working population has led to the increase of the use of bikes. A technological revolution has been around the corner, people have become techsavy, that have resulted in the increase in the demand for more technical advance stylish bikes .These days younger’s have time constrains and as a result of it they prefer to buy the product that are fast & powerful as well as fuel efficient logically, which has given them an advantage over others to reduce time spent in heavy traffic.

4-TECHNOLOGY CHANGE

Technological changes are happening at a very fast rate due to which bike companies’ is able to provide advanced technology products to the customers. As a result of technological changes companies’ has also increased their product line. It is adapting to the technological changes as the old technology is becoming obsolete. One of the most important affects of technological changes that have led to the increase of the demand of NICHES BIKES.The recent technological changes can be seen in their recent products like New DIRECT FUEL SUPPLY ENGINES, NEW TUBLESS TYRE’S, NEON HEAD-LAMPS, NEW METTLED FRAME, MUSCULAR BODY’S, HIGHLY FUEL EFFICIENT IN THEIR CATEGARY, which are in the market.

5-INFRASTRUCTURE

As well as increasing in income, purchasing power of India increases with the match of increment infrastructure of our country also develops. Every city it is either big or small spend an accountable amount to develop their infrastructure. In these infra revolution the transport department has the big shares. To keep the transportation efficient & fast many steps was taken by the government. This includes developing of rapid mass transport system like metros, for luggage transportation freight corridor, developing golden quadrilateral four lane road etc. Making of over bridges, bypasses’ to light the traffic of city, better signaling system clear the way of luxury cars, niches bikes.

INDIAN BIKE INDUSTRY:-

BAJAJ AUTO HERO HONDA KINETIC MOTOR

› Kawasaki Ninja* › Hero Honda Achiever › Kinetic Aquila

› Bajaj XCD 135 DTS-Si* › Hero Honda CD Dawn › Kinetic Comet

› Bajaj Discover DTSi › Hero Honda CD Deluxe › Kinetic Stryker

› Bajaj Platina › Hero Honda Glamour

› Bajaj Pulsar DTSi › Hero Honda Karizma  

› Bajaj Pulsar 200CC* › Hero Honda Passion Plus

› Bajaj Avenger › Hero Honda Splendor  

› Bajaj Pulsar DTS-Fi 220 CC* › Hero Honda Splendor NXG -

› Bajaj Discover DTS-Si 100cc* › Hero Honda CBZ X-Treme -

› Hero Honda Hunk  

› Karizma ZMR FI

LML INDIA ROYAL ENFIELD TVS MOTOR

› LML Adreno FX › Bullet 350 › Suzuki Hayabusa 1300

› LML Beamer › Thunderbird Twinspark › Suzuki Intruder M1800R

› LML Energy FX › Bullet Electra › Suzuki GS 150R

› LML Freedom › Bullet Machismo › TVS Apache RTR FI

› LML Graptor › Bullet Machismo 500 › TVS Flame

› Royal Enfield Bullet Classic 500› TVS Star City

› TVS Taurus Fiero F3*

HMSIL SUZUKI MOTOR YAMAHA MOTOR

› Honda Shine › Suzuki Access 125 › Yamaha Fazer

› Honda Unicorn Grand Prix Edition

› Suzuki Heat › Yamaha FZS

› Honda Stunner CBF › Suzuki Zeus › Yamaha FZ 150cc

› Honda CBF Stunner FI › Suzuki Hayabusa 1300 › Yamaha Gladiator

- › Suzuki Intruder M1800R › Yamaha Libero G5

- › Suzuki GS 150R › Yamaha Gladiator Type JA

- - › Yamaha Alba 106

› Yamaha YZF R1

- - › Yamaha MT 01

- - › Yamaha YZF-R15

- - › Yamaha Crux

Niches bike industry was really initiated by HERO HONDA in early 2001-2002 but at that time Indian buyers was not ready to pay much for these bikes ,the hero honda plan become’s badly flop. By the efforts of hero honda the change in Indian mindset occurs. later on introducing of pulser 150-180 cc they are ready to pay more and they clear the way of niche bike market.

INDIAN INFRASTRUCTURE

India has a vast network of National Highways (NHs) connecting important towns cities, ports and industrial centers of the country.

Indoctrination of the country has induced a traffic growth of 8-12 percent per year on many sections of National Highways and this growth trend is expected to continue. While the traffic on National Highways has been growing at a rapid pace, it has not been possible for the Government to provide matching funds due to competing demand from other priority sectors. This has led to a large number of deficiencies in the network. Many sections of the NHs are in need of capacity augmentation by way of widening grade separation construction of bypasses bridges and expressways etc. Many bridges are in need of replacement. The traffic movement on NHs is also hindered due to a large number of Rail-Road crossings where road traffic has to per force stop due to the frequent closures. The overall scenario on the highways has led to economic losses by way of longer turn around time for the vehicle fleeting rising vehicle operating costs and dissipation of human energy in the driving. This calls for urgent remedial measures.

To motivate the inflow of resources for the development, maintenance and management of NHs and to improve their efficiency, productivity and quality of service and to bring in competitiveness in providing highway services to road users. The Government of India in consonance with its general policy of liberalization/globalization of Country's economy welcomes private investment in National Highways and hopes that this measure would help in improvements of the existing highways and bring in the latest technology and improvements of the existing highways and bring in the latest technology and improved management techniques. The users are already accustomed to pay fee for use of bridges on National Highways for the last two decades. Other highway projects have also been awarded to private sector recently and the experience gained in the process has been utilized in framing these guidelines.

Existing Network

ROAD NETWORK 

India has one of the largest road networks in he world (over 2.9 million km at present).   For the purpose of management and administration, roads in India are divided into the following five categories:

National Highways (NH) State Highways (SH)

Major District Roads (MDR)

Other District Roads (ODR)

Village Roads (VR)

The National Highways are intended to facilitate medium and long distance inter-city passenger and freight traffic across the country. The State highways are supposed to carry the traffic along major centers within the State.  Other District Roads and Village Roads provide villages accessibility to meet their social needs and also the means to transport agriculture produce from village to nearby markets. Major District Roads provide the secondary function of linkage between main roads and rural roads

ROAD NETWORK

CATEGORIES LENGTH (KMS).

Primary road system covering

National Highways (NH)

 

34,608

Secondary road system covering

State Highways (SH)

 

128,622

Other roads including major

District roads (MDR) other

District roads (ODR) and

Village roads (VR)

 

 

 

2,737,080

The deficiencies in the existing National Highways network (as on 1.4.96) and estimated cost of their removal are as given below. These works are required to be completed within a period of 10-15 years.

(A) N.H.

S.No. Category of Work Length/No.Estimated Cost (1.4.96 prices)

1Widening of single lane to two lanes including strengthening of pavement

5200 km 5200 Cr.

2 Widening of 2 lanes roads (4 lane or wider) 14.000 km 42.000 Cr.3 Strengthening of pavement (2 lane equivalent) and 15.000 km 9.000 Cr.

construction of paved shoulders

4 Construction of bypasses 40 No. 2.000 Cr.

5 Construction of Bridges 470 1.000 Cr.

6 Miscellaneous & Road Safety Works L.S. 5.000 Cr.

    Total 64,2000 Cr.

(B) Expressways

Construction of Expressways on new Alignments 2000 km 16,000 Cr

Total (A) + (B)   80,200 Cr.

 

BOOSTING OF INFRA CHANGE’S (GOVERNMENT STEPS)

Categories of projects identified for private investment are given in the following table :

S.No. Category of projects Indicative Quantum

Existing Network

1 Widening from 2 lanes to 4 lanes 4000 km

2 Major Bridges 50 No.

3 Railway Over Bridges 50 No.

4 Elevated section through Urban Areas To be identified

5 Interchanges To be identified

6 Bypasses 30 No.

New Network

7 Expressways

GOVERNMENT SUPPORT

 Government will carry out all preparatory works for the projects identified for private investment and meet the cost of following items :

(1) Detailed feasibility Study(2) Land for Right-of-way and en route facilities.(3) Clearance of the Right-of-way land: Relocation of utility services, cutting of trees, resettlement and rehabilitation of the affected establishments.(4) Environmental Clearances.

Depending upon the financial viability of a project the Government may recoup its investment on the above items from the project.

FOREIGN INVESTMENT 

  Government has recently decided to permit automatically Foreign Direct Investments upto 74% equity for road and bridge construction as a part of infrastructure. Foreign Direct Investment (FDI) proposals beyond that would be considered by the Foreign Investment Promotion Board on case to case basis.

TAX / FISCAL CONCESSIONS 

  Concessions Available for Enterprise Undertaking any Project :(1) In the case of an enterprise (the enterprise is owned by a company registered in India or by a consortium of such companies) carrying on the business of developing, maintaining and operating any infrastructure facility, hundred per cent of the profits and gains derived from such business for the initial 5 assessment years and thereafter, thirty percent of such profits and gains are expected from Corporate Tax. The tax concession may be availed of by the enterprise in any ten consecutive assessment years falling within a period of twelve assessment years beginning with the assessment year in which the enterprise beings operating and maintaining infrastructure facility. The meaning of infrastructure is given in Section 80-IA (12) (ca) of the income Tax Act 1961, and includes a road, highway and a bridge.

  Concessions Available for Lenders / Investors(1) As an incentive to financial institutions to provide finance for the infrastructure projects, deduction up to 40% of their income derived from financing of these investment is available provided the amount is kept in a special reserve.(2) Exemption for infrastructure Funds from Income Tax on the income from dividend, interest on long term capital gains of such funds or companies from investments in the form of shares or long term finance in any enterprise set up to develop, maintain and operate an infrastructure facility.(3) Subscription to equity shares or debentures issued by a public company formed and registered in India and the issue is wholly and exclusively for the purposes of developing, maintaining and operating an infrastructure facility, will be eligible for deductions under Section 88 of the Income Tax Act 1961, which permits deduction equal to 20% of the amount subscribed, from the amount of tax payable by the subscriber. In case of such investment the limit of Rs. 60,000/- per year under section 88 has been raised to Rs. 70,000/-

REVISION OF FEE 

  The revision of the fee may be allowed every year following commissioning of the road for traffic, lined to the Wholesale Price Index (WPI). Such version may be allowed twice in a year when the inflation in the same year jumps by four points. While full compensation would be allowed to offset inflation during a specified period and the extent of compensation may be progressively reduced thereafter in accordance with Bid conditions.

PROJECT CONSTRUCTION 

The enterprise is to complete the project within the period specified for construction, conforming to the standards and specifications prescribed in the agreement and to the satisfaction of Implementing Agency. Any delay in completion of the project will be to the account of the enterprise unless such delay can be directly attributed to the Government and/or implementation Agency's. Delays occurring on account of Government/ implementing agency would entitle the Enterprise to an appropriate extension in the construction period, and/or to such other compensation as the Bidding conditions may specify

HANDLING OVER LAND TO ENTERPRISE 

  The land meant for highway construction and the land meant for and the land meant for en route highway related facilities will be given to the enterprise on lease for the concession period. Any expenditure on stamp duty etc. incurred on documentation for lease of the land will be borne by the enterprise. The lease for the land will be suitably extended in the event the concession period is extended for any reason. The enterprise is not allowed to sub-lease the land to nay one. However, the enterprise is free to license the enrooted highway related facilities to anyone for the period(s) limited to the concession period

PERFORMANCE SECURITY 

The successful enterprise will be required to furnish a performance security bond of an amount equal to 3% of the cost of project as indicated in the feasibility study. Such bond would be discharged after 25% of the works have been completed

MANAGEMENT OF THE HIGHWAY STRETCH 

  For the purpose of proper management the highway stretch built through private investment the enterprise will have power to regulate and control the traffic on the highway stretch forming part of the agreement between the Government and the enterprise. In order to reduce interference from other authorities no sales tax and octroi barriers will be established on the highway stretch but properly designed unified checks barriers may be allowed at the inter-state borders located outside the right-of-way with proper entry/exit layouts

TRANSFER OF THE PROJECT TO THE GOVERNMENT 

 For the purposes of transfer the project will consist of the assets built within the right-of-way and the junction/inter-section areas the enroute highway related facilities .At the end of the concession period the project in sound conditions shall be transferred by the enterprise to the Government free of any cost. The standards to which the project will conform to at the time of its transfer to the Government will be laid down in the concession agreement. Even after the transfer of the project to the Government the Implementation Agency will continue to the exercise control on the highway related development at the entry.

Key Issues & Challenges

1. Providing highly efficient, powerful bikes.2. Changing the Indian mint-set for niche’s bikes.3. Provide better resale value.4. Recession.5. Globalization.

Conclusion:-

The highly efficient Indian bike market is hard to digest stylish, powerful bike’s of Harley Davidson, Ducati, Kawasaki Ninza etc because of its high fuel consumption. Yet stylish bike market is increase due to increase in youths that’s have high earning, increase in income level, availability of stylish bikes, change in preference’s , good roads, developing infrastructure’s. But it is highly uncertain that power bikes can repeat the success of highly fuel efficient, great resale value of existing bikes and it becomes the bike of Indian middle class family who are the main consumer of bikes or it limits high class rich family accessories.