Honda Motorcycle & Scooter India has posted over an 87 percent increase in profit after tax for FY23. Higher operating leverage and cost reduction exercise helped the Indo-Japanese two-wheeler major to post its record profits.
The net profit for FY23 stood at Rs 1,862.18 crore or USD 223 million versus Rs 999.82 crore in FY22. A 14 percent increase in volumes for the last fiscal year drove the revenues to Rs 25,615.22 crore or USD 3.08 billion, registering a growth of 21 percent, as per the financials sourced from market intelligence firm Tofler.
Honda making India key export base
With an aim to establish India as a global export hub for Honda, the company had established its new Overseas Business vertical by integrating its SEDBQ (Sales, Engineering, Development, Purchasing & Quality) functions in FY22.
On the overseas exports front, Honda commenced exports of its 125cc motorcycles to Australia and New Zealand. It also made its first foray into the African continent by starting exports of the Unicorn to Nigeria.
Defined EV roadmap
The company had announced an entry into the EV space in March 2023. Our sister publication Autocar Professional had earlier reported that the company is readying an ambitious plan of introducing 10 electric two wheelers in the coming decade that will cater to the entire spectrum of zero emission vehicles in the future.
To kickstart the electric vehicle gameplan, the work on two projects codenamed GJNA and K4BA has already started. One of them is the Activa Electric, which will be based on a fixed battery construct, whereas the other is a moped that will come with a swappable battery alternative.
The first EV from Honda Motorcycle will hit the roads in March 2024, followed by another model in September 2024. Both these models have been developed with a volume of the potential of half a million units cumulatively over three years. As more models are introduced till 2026-2027, the maker of Activa and Shine hopes to take up volumes close to million units.
Building market share
Overall, HMSI closed FY2022-'23 with total sales of 43,50,943 units. This includes domestic sales of 40,25,486 units and exports of 3,25,457 units. Notably, Honda Motorcycle & Scooter India registered a 14 percent year to date growth in FY’2022-23.
During FY23, Honda Motorcycle & Scooter narrowed the gap with Hero MotoCorp for the No. 1 two-wheeler maker spot. The incremental volumes of the new 100cc shine helped the company hold on to its 25 percent share, whereas the market leader saw its share drop about 150-175 basis points to 32.5 percent, which was the lowest ever share for Hero.
In the scooter segment, Honda saw a marginal slip in share to 46.61 percent from about 48.31 percent. The company entered the sizable 100cc motorcycle segment with the launch of the Shine 100 to challenge Hero MotoCorp yet again to make a dash at the No. 1 two-wheeler manufacturer slot, which brought in incremental volumes.
Also See:
Honda Shine 100 review: Big ambitions
With inputs from Shahkar Abidi.