A STUDY ON IMPORTANT TOOLS OF THE SALES PROMOTIONAL STRATEGY (WITH SPECIAL REFERENCE TO SRI VARALAKSHMI HERO MOTORS PVT.

LTD.)

CHAPTER: I
INTRODUCTION TO THE TOPIC NEED FOR THE STUDY OBJECTIVES OF THE STUDY RESEARCH METHODOLOGY DATA COLLECTION PRIMARY SOURCES SECONDARY SOURCES QUESTIONNAIRE SAMPLE DESINGS LIMITATIONS OF THE STUDY

INTRODUCTION
India is the second largest producer of two-wheelers in the world. In the last few years, the Indian two-wheelers industry has seen spectacular growth. The country stands next to China and Japan in terms of production and sales respectively. Majority of Indians, especially the youngsters prefer motorbikes rather than cars. Capturing a large share in the two-wheeler industry, bikes and scooters cover a major segment. Bikes are considered to be the favorite among the youth generation, as they help in easy communication. Large varieties of two-wheelers are available in the market, known for their latest technology and enhanced mileage. Indian bikes, scooters and mopeds represent style and class for the both men and women. The study and analysis of Two-Wheelers in Hero Two-wheeler company as the main theme them the study. Todays business operates in highly competitive environment. Marketing is most dynamic and challenging function of modern business at these changing preference of people, the business organization are trying to attract to customers at that possible extant. Companies are creating new ways and tools to make the public know about their products. Within this exchange transaction customers will only exchange what they value (money) if they feel that their needs are being fully satisfied; clearly the greater the benefit provided the higher transactional value an organization can charge. Marketing objectives, goals and targets have to be monitored and met, competitor strategies analyzed, anticipated and exceeded. Through effective use of market and marketing research an organization should be able to identify the needs and wants of the customers and try to delivers benefits that will enhance or add to the customers lifestyle. While at the same time ensuring that the satisfaction of these needs results in a healthy turnover for the organization. Philip Kotler defines marketing as satisfying needs and wants through an exchange processes.

NEED FOR THE STUDY

The main basic reason to study the promotion in organization is to evaluate the extent of satisfaction attained by the customer and the extent of fulfillment of needs and wants of the customer. Discounts and offers are one of the important tools of the sales promotional strategy. The study involves import the discounts and offers have on the company in terms of sales Revenue, Market Share, Competitive advantage, Increase in sales, attracting the competitive customers.

OBJECTIVES OF THE STUDY

To analyze the customers opinion on discounts and offers. To enumerate the impact of discounts and offers on sales. To estimate the respective customers among major competitive brands analyzed (HERO, HONDA, SUZUKI etc,). To analyze the consumers purchasing power and buying behavior. To analyze the consumer mode of payment at the time of purchase (direct payment, finance).

RESEARCH METHODOLOGY
Methodology can prepare to the theoretical analysis of the methods appropriate to a field of study or to the body of methods and principles to branch of knowledge. A body practices, procedures, and rules used by those who in a discipline or engage in an enquiry the branch of philosophy that analysis the principles and procedures of enquiry in a particular discipline.

DATA COLLECTION
The data for the study has been adopted to collect data from the primary sources.

PRIMARY SOURCES
Various techniques have been adopted to collect data from the primary sources.

QUESTIONNAIRE
A well structured Questionnaire was developed for customers to extract information.

SECONDARY SOURCES
To trace the origin, growth and performance of Hero the companys internal survey record material, and magazines, broachers and milestones are utilized.

SAMPLE DESIGNS
A selective sample has been drawn from different customers groups with sample size of 200 each taking all demographic factors in view.

LIMITATIONS
The scope has been confined to Vizianagaram and surrounding areas The perceptual bias or attitude of respondents may also act as hurdles to the study The size of sample is not consistent of the total customers Time is another major contrasting factor, as the project done in a time period of 3 months

CHAPTER: II

ORGANISATION PROFILE

MOTORCYCLE
A motorcycle (also called a motorbike, bike, or cycle) is a single-track, engine-powered, two-wheeled motor vehicle. Motorcycles very considerably depending on the task for which they are designed, such as long distance travel, navigating congested urban traffic, cruising, sport and racing, or off- road conditions.

AN URAL MOTORCYCLE WITH SIDECAR

Motorcycles are one of the most affordable forms of motorized transport in many parts of the world and, for most of the worlds population; they are also the most common type of motor vehicle. There are around 200 million motorcycles (including mopeds, motor scooters and other powered two and three-wheelers) in use worldwide, or about 33 motorcycles per 1000 people. This compares to around 590 million cars, or about 91 per 1000 people. Most of the motorcycles, 58%, are in the developing countries of Asian- southern and Eastern Asia, and the Asia Pacific countries, excluding Japan-while 33% of the cars (195 million) are concentrated in United States and Japan. As of 2012, India with an estimated 37 million motorcycles/mopeds was home to the largest number of motorized two-wheelers in the world. China come a close with 34 million motorcycles/mopeds.

HISTORY REPLICA OF DAIMLER-MAY BACH PETROLEUM REITWAGEN

The first internal combustion, petroleum fueled motorcycle was the petroleum reitwagen. It was designed and built by the German investors Gottlieb Daimler and Wilhelm May Bach in bad Constant, German in 1885. This vehicle was unlike either the safety bicycles or the boneshaker bicycles of the era in that it had zero degrees of steering axis angle and no fork offset, and thus did not use the principles of bicycles and motorcycles dynamics developed nearly 70 years earlier. The investors called invention the Reitwagen (Riding Car). It was designed an expedient test bed for their new engine, rather than a true prototype vehicle. Many authorities who exclude steam powered, electric or diesel two-wheelers from definition of a motorcycle, credit the Daimler Reitwagen as the worlds first motorcycle.

If a two-wheeled vehicle with steam propulsion is considered a motorcycle, then the first was the French Mixchaux-Perreaux steam bicycle of 1868. This was followed by the American Roper steam velocipede of 1869 built by Sylvester Howard Roper of Roxbury, Massachusetts. Roper demonstrated at fairs and circuses in eastern U.S in 1867, and built a total of 10 examples. In 1894, Hidebrand & Wolfmuller became the first series production motorcycles and the first to be called a motorcycle (German: Motorrad). In the early period of motorcycle history, many producers of bicycles adapted their designs to accommodate the new internal combustion engine. As the engines became more powerful and design outgrew the bicycle origins, the number of motorcycles producers increased. Until World War I, the largest motorcycle manufactured in the world was Indian, producing over 20,000 bikes per year. By 1920, this honor went to Harley-Davidson, with their motorcycles being sold by dealers in 67 countries. By the late 1920s of early 1930s, DKW took over as the largest manufacturer. After World War II, the BSA group became the largest producer of motorcycles in the world, producing up to 75,000 bikes per year in the 1950s. The German company NSU held the position of largest manufacturer from 1955 until the 1970s. NSU Soirtnax streamlined motorcycle, 250cc class winner of the 1955 grand Prix season. NSU produced the most advanced design, but after the deaths of four NSU riders in the 1954-1956 seasons, they abandoned further development and quit Grand Prix motorcycle racing. Moto Guzzi produced competitive race machines, and by 1957 nearly all the Grand Prix races were being won by streamlined machines. The following year, 1958, full enclosure fairings were banned from racing by the FIM in the light of the safety concerns. From the 1960s through the 1990s, small two-stroke motorcycles were popular worldwide, partly as a result of East German Walter Kaadens engine work in the 1950s. Today, the motorcycle industry is mainly dominated by Japanese companies witch as Honda, Kawasaki, Suzuki, and Yamaha, although Harley-Davidson and BM continue to be popular and supply considerable markets. Other major manufacturers include piaggio group of Italy, KTM Triumph and Ducati. In addition to the large capacity motorcycles, there is a large market in smaller capacity (less than 300cc) motorcycles, mostly concentrated in Asian and African countries. Today, this area is dominated by mostly Indian companies with hero Honda emerging as the worlds largest manufacturer of two wheelers. Super splendor model has sold more than 8.5 million to date.

A SUZUKI GS500 WITH A CLEARLY VISIBLE FRAME (PAINED SILVER) CONSTRUCTION

Motorcycle construction is the engineering, manufacturing, and assemble of components and systems for a motorcycle which results in the performance, cost, and aesthetics desired by the designer. With some exceptions, construction of modern mass-produced motorcycles has standardized on a steel or aluminum frame, telescopic forks holding the front wheel, and disc brakes. Some other body parts, designed for either aesthetic or performance reasons may be added. A petrol powered engine typically consisting of between one and four cylinders (and less commonly, up to eight cylinders) coupled to a manual fiv e or six- speed sequential transmission drives the swing arm mounted rear wheel by a chain, driveshaft or belt.

FUEL ECONOMY
Motorcycle fuel economy varies greatly with engine displacement and riding style ranging from a low of 29 mpg-us (801L/100 km; 35mpg-imp) reported by a Honda VTR 1000F rider, to 107 mpg-us (2020 L/100km; 129 mpg-imp) reported for the Verucci Nitro 50cc Scooter. A specially designed Matzu Matsuzawa Honda XL 125 achieved 470 mpg-us (0.50 L/100km; 560 mpg-imps) on real highways in real conditions. Due to lower engine displacements (100 cc 200cc) motorcycles in developing countries offer good fuel economy. In the Indian market, the second best selling company, Bajaj, offers two models with superior fuel economy; XCD 125 and platina. Both are 125 cc motorbikes with a companyclaimed fuel economy of 256 mpg-Us (0.919 L/100 km; 307 mpg-1mp) and 261 mpg-us (0.901 L/100 km; 313 mpg-imp), respectively.

ELECTRIC MOTORCYCLES
Very high fuel economy equivalents can be derived by electric motorcycles. Electric motorcycles are nearly silent, Zero-emission electric motor-driven vehicles. Operating range and top speed suffer because of limitations of battery technology. Fuel cells and petroleum-electric hybrids are also under development to extend the range and improve performance of the electric motors

DYNAMICS RACING MOTORCYCLES LEANING IN A TURN

Different types of motorcycles have different dynamics and these play a role in how a motorcycle performs in given conditions. For example, one with a longer wheelbase provides the feeling of more stability by responding less to disturbances. Motorcycle tires have a large influence over handling. Motorcycles must be leaned in order to make turns. This lean is induced by the method known as counter steering, in which the rider steers the handlebars in the direction opposite of the desired turn. Because it is counter-intuitive this practice is often very confusing to novices and even to many experienced motorcyclists. Short wheelbase motorcycles, such as sport bikes, can generate enough torque at the rear wheel, and enough stopping force at the front wheel, to lift the opposite wheel off the road. These actions, if performed on purpose, are knowns wheelies and stop pies respectively. If carried past the point of recovery the resulting upset is known as an endo (short for end over-end), or looping the vehicle.

ACCESSORIES
Various features and accessories may be attached to a motorcycle either as OEM (factory-fitted) or after-market. Such accessories are selected by the owner to enhance the motorcycles appearance, safety, performance, of comfort.

SOCIAL ASPECTS (POPULARITY)

MOTORBIKES ARE THE PRIMARY FORM OF TRANSPORTATION IN VIETNAM
In numerous cultures, motorcycles are the primary means of motorized transport. According to the Taiwanese government, for example, the number of automobiles per ten thousand populations is around 2,500 and the number of motorcycles is about 5,000. In places such as Vietnam, Motorized traffic consist of mostly motorbikes due to a lack of public transport and low income levels that put automobiles out of reach for many.

The four largest motorcycle markets in the world are all in Asia: China, India, Indonesia, and Vietnam. The motorcycle is also popular in Brazils frontier towns. Amid the global economic downturn of 2008 the motorcycle market grew by 6.5%. Recently years have seen an increase in the popularity of motorcycles elsewhere. In the USA, registrations increased by 51% between 2000 and 2005. This is mainly at tribute to increasing fuel prices and urban congestion. A Consumer Reports subscribers survey of mainly United States motorcycle and scooter owners reported that they rode an average of only 1,000 miles (1,600 km) per year, 82% for recreation and 38% for commuting. Americans put 10,000 12,000 miles (16000-19000 km) per year on their cars and light trucks. Around the world, motorcycles have historically been associated with subcultures. Some of these subcultures have been loose-knit social groups such as the caf racers of 1950s Britain, and the Mods and Rockers of the 1960s. A few are believed to be criminal gangs

SUNBEAM MOTORCYCLE OWNERS RALLY, 2008

Social motorcyclist organizations are popular and are sometimes organized geographically; focus on individual makes, or even specific models. Example motorcycle clubs include: American Motorcyclist Association, Harley Owners Group and BMW MNA. Some organizations hold large international motorcycle rallies in different parts of the world that are attended by many thousands of riders. Where as many social motorcycle organizations raise money for charities through organized events and rides, some other motorcycle organizations exist only for the direct benefit of others Bikers Against Child Abuse (BACA) is one example BACA assigns members to individual children to help them through difficult situations, or even stay with the child if the child is alone or frightened. In recent decades motorcyclists have formed political lobbying organizations in order to influence legislators to introduce motorcycle friendly legislation. One of the oldest such organization the British motorcycle action group, was founded in 1973 specifically in response to helmet compulsion, introduced without public consultation. In addition the British Motorcyclists federation (BMF), originally founded in 1960 as a reaction to the public perception of motorcyclists as leather jacketed hooligans, has itself moved into political lobbying.

10

Likewise the US has ABATE, which, like most such organizations, also works to improve motorcycle safety, as well as running the usual charity fund raising events and rallies, often for motorcycle-related political interests. At the other end of the spectrum from the charitable organizations and the motorcycle rights activists are the Outlaw Motorcycle Gangs. These are defined by the Provincial Court of Manitoba as: Any group of motorcycle enthusiasts who have voluntarily made a commitment to band together and abide by their organizations rigorous rules enforced by violence.

MOTORCYCLE IN INDIA

Company : HERO HONDA Hero Honda Achiever Hero Honda CD Dawn Hero Honda Glamour Hero Honda Glamour-Fi Hero Honda Karizma Hero Honda passion Plus Hero Honda Pleasure Hero Honda Super Splendor Hero Honda Splendor NXG Hero Honda CBZ X-Treme Company: Kinetic Company Kinetic Aquila Kinetic Boss Kinetic Challenger Kinetic Comet Kinetic GF Kinetic Stryker Kinetic Velocity

Company: Bajaj Auto Ltd., Bajaj Avenger Bajaj CT 100 Bajaj Platina Bajaj Discover DTSi Bajaj Pulsar DTSi Bajaj Wave Bajaj Wind 125 Sonic DTSi

Motor Company: TVS MOTOR TVS Apache TVS Centra TVS Fiero TVS Star TVS Victo

Company: India

Yamaha

Motor

Yamaha CruxS Yamaha GS Yamaha Gladiator

SCOOTERS IN INDIA
The Scooter and the scooter share in the Indian two Wheeler market is 13.4%. The main Models available I India are Bajaj Chetak, Honda, Eterno, Kinetic, Blaze, etc.

11

SCOOTERETTES/MOPEDS
TVS Motors launched Indias 50cc, 2 seater moped: TVS Moped 50. TVS also launcheds first indigenous scooterette: Scooty in 1994. This segment has about one-fourth share in the Indian two wheeler industry. The major models available in India are Hero Honda CD Dawn, Hero Honda Plasure, Kinetic Kine, Kinetic $s, Kinetic Nova, Kinetic Zoom, Kinetic V2 Range, Kinetic King. The Fedral Bureau of Investigation (FBI) and Criminal Intelligence Service Canada have designated four MCs as Outlaw Motorcycle Gangs (OMGs), which are the Pagans, Hells Angels, Outlaws MC, and Bandidos, Known as the Big Four. As a cost-efficient alternative to infrequent and expensive public transport systems, or a means of avoiding or reducing the effects of urban congestion. In Places where it is permitted, lane splitting, also known as filtering, allows motorcycles to use the space between vehicles to move through stationary or slow traffic.

A BOULEVARD CRUISER (FRONT) AND A SPORT BIKE (BACKGROUND)

TYPES
There are three major types of motorcycle: Street, off-road, and dual purpose. Within these types, there are many different sub-types of motorcycles for many different purposes. Each configuration offers either specialized advantage or broad capability, and each design creates a different riding posture. Street bikes include cruisers, sport bikes, scooters and mopeds, and many other types. Off-road motorcycles include many types designed for dirt-oriented racing classes such as motocross and are not street legal in most areas. Dual purpose machines like the dual-sport style are made to go off-road but include creatures to make them legal and comfortable on the street as well.

MOTORCYCLE RIDER POSTURES

The Motorcyclists riding position depends on rider body-geometry combined with the geometry of the motorcycle itself. These factors create a set of three basic postures.

Sport the rider leans forwards into the wind and the weight of the upper torso is
supported by air pressure as long as the motorcycle.

12

 Travelling at speed, typically about 50 mph. The foot pegs are below the rider or to the
rear. The reduced frontal area cuts wind resistance and allow higher speeds.

However, at low speed this position throws the weight of the rider onto the aims
instead, and this is quickly tiring to the wrists of unfamiliar riders. Moreover, the sports position makes it more difficult for the rider to look around and foot though traffic.

LEGAL DEFINITIONS AND RESTRICTIONS

A motorcycle is broadly defined bylaw in most countries for the purposes of registration taxation and rider licensing as a powered two-wheel motor vehicle. Most countries distinguish between mopeds of 49cc and the more powerful, larger, vehicles (scooters do not count as a separate category) Many jurisdictions include some forms of three-wheelers as motorcycles.

ORGANIZATION PROFILE
Hero is the brand name used by the Munjal brothers for their flagship company, Hero Cycles Ltd. A joint venture between the Hero Group and Honda Motor Company was established in 1984 as the Hero Honda Motors Limited at Dharuhera, India. Munjal family and Honda group both owned 26% stake in the Company. In 2010, it was reported that Honda planned to sell its stake in the venture to the Munjal family. During the 1980s, the company introduced motorcycles that were popular in India for their fuel economy and low cost. A popular advertising campaign based on the slogan 'Fill it Shut it Forget it' that emphasized the motorcycle's fuel efficiency helped the company grow at a double-digit pace since inception. The technology in the bikes of Hero Honda for almost 26 years (19842010) has come from the Japanese counterpart Honda. Hero Moto Corp has three manufacturing facilities based at Dharuhera, Gurgaon in Haryana and at Haridwar in Uttarakhand. These plants together are capable of churning out 3 million bikes per year. Hero Moto Corp has a large sales and service network with over 3,000 dealerships and service points across India. The company has a stated aim of achieving revenues of $10 billion and volumes of 10 million two-wheelers by 201617. This is conjunction with new countries where they can now market their two-wheelers following the disengagement from Honda. Hero Moto Corp hopes to achieve 10 per cent of their revenues from international markets, and they expected to launch sales in Nigeria by end-2011 or early-2012. In addition, to cope with the new demand over the coming half decade, the company was going to build their fourth factory in South India and their fifth factory in Western India. There is no confirmation where the factories would be built.

VISION
The story of Hero Honda began with a simple vision - the vision of a mobile and an empowered India, powered by its bikes. Hero Moto Corp Ltd., company's new identity, reflects its commitment towards providing world class mobility solutions with renewed focus on expanding company's footprint in the global arena.

13

MISSION
Hero Moto Corp's mission is to become a global enterprise fulfilling its customers' needs and aspirations for mobility, setting benchmarks in technology, styling and quality so that it converts its customers into its brand advocates. The company will provide an engaging environment for its people to perform to their true potential. It will continue its focus on value creation and enduring relationships with its partners.

STRATEGY
Hero Moto Corp's key strategies are to build a robust product portfolio across categories, explore growth opportunities globally, continuously improve its operational efficiency, aggressively expand its reach to customers, continue to invest in brand building activities and ensure customer and shareholder delight.

HISTORY
Hero Moto Corp was started in 1984 as Hero Honda Motors Ltd. 1956Formation of Hero Cycles in Ludhiana(majestic auto limited) 1975Hero Cycles becomes largest bicycle manufacturer in India. 1983Joint Collaboration Agreement with Honda Motor Co. Ltd. Japan signed Shareholders Agreement signed 1984Hero Honda Motors Ltd. incorporated 1985Hero Honda motorcycle CD 100 launched. 1989Hero Honda motorcycle Sleek launched. 1991Hero Honda motorcycle CD 100 SS launched. 1994 Hero Honda motorcycle Splendor launched. 1997Hero Honda motorcycle Street launched. 1999 Hero Honda motorcycle CBZ launched. 2001 Hero Honda motorcycle Passion and Hero Honda Joy launched. 2002Hero Honda motorcycle Dawn and Hero Honda motorcycle Ambition launched. 2003Hero Honda motorcycle CD Dawn, Hero Honda motorcycle Splendor plus, Hero Honda motorcycle Passion Plus and Hero Honda motorcycle Karizma launched. 2004Hero Honda motorcycle Ambition 135 and Hero Honda motorcycle CBZ launched. 2005Hero Honda motorcycle Super Splendor, Hero Honda motorcycle CD Deluxe, Hero Honda motorcycle Glamour, Hero Honda motorcycle Achiever and Hero Honda Scooter Pleasure. 2007New Models of Hero Honda motorcycle Splendor NXG, New Models of Hero Honda motorcycle CD Deluxe, New Models of Hero Honda motorcycle Passion Plus and Hero Honda motorcycle Hunk launched.

14

 2008New Models of Hero Honda motorcycles Pleasure, CBZ Xtreme, Glamour, Glamour Fi and Hero Honda motorcycle Passion Pro launched. 2009New Models of Hero Honda motorcycle Karizma: Karizma ZMR and limited edition of Hero Honda motorcycle Hunk launched 2010new Models of Hero Honda motorcycle Splendor Pro and New Hero Honda motorcycle Hunk and New Hero Honda Motorcycle Super Splendor launched. 2011New Models of Hero Honda motorcycles Glamour, Glamour FI, CBZ Xtreme, Karizma launched. New licensing arrangement signed between Hero and Honda. In August Hero and Honda parted company, thus forming Hero Moto Corp and Honda moving out of the Hero Honda joint venture. In November, Hero launched its first ever Off Road Bike Named Hero "Impulse". 2012-New Models of Hero Moto corp. Maestro the Masculine scooter and Ignitor the young generation bike are launched.

TERMINATION OF HONDA JOINT VENTURE

In December 2010, the board of directors of the Hero Honda Group has decided to terminate the joint venture between Hero Group of India and Honda of Japan in a phased manner. The Hero Group would buy out the 26% stake of the Honda in JV Hero Honda. Under the joint venture Hero Group could not export to international markets (except Sri Lanka) and the termination would mean that Hero Group can now export. Since the beginning, the Hero Group relied on their Japanese partner Honda for the technology in their bikes. So there are concerns that the Hero Group might not be able to sustain the performance of the Joint Venture alone. The Japanese auto major will exit the joint venture through a series of off market transactions by giving the Munjal family that held a 26% stake in the company an additional 26%. Honda, which also has an independent fully owned two-wheeler subsidiary Honda Motorcycle and Scooter India (HMSI) will exit Hero Honda at a discount and get over $1 billion for its stake. The discount will be between 30% and 50% to the current value of Honda's stake as per the price of the stock after the market closed on Wednesday. The rising differences between the two partners gradually emerged as an irritant. Differences had been brewing for a few years before the split over a variety of issues, ranging from Honda's reluctance to fully and freely share technology with Hero (despite a 10-year technology tie-up that expires in 2014) as well as Indian partner's uneasiness over high royalty payouts to the Japanese company. Another major irritant for Honda was the refusal of Hero Honda (mainly managed by the Munjal family) to merge the company's spare parts business with Honda's new fully owned subsidiary Honda Motorcycle and Scooter India (HMSI). Honda will continue to provide technology to Hero Honda motorbikes until 2014 for existing as well as future models.

15

HERO MOTO CORP

The new brand identity and logo of Hero Moto Corp were developed by the British firm Wolff Olins. The logo was revealed on 9 August 2011 in London, to coincide with the third test match between England and India. Hero Moto Corp can now export to Latin America, Africa and West Asia. Hero is free to use any vendor for its components instead of just Honda-approved vendors. Hero Moto Corp Ltd. (Formerly Hero Honda Motors Ltd.) is the world's largest manufacturer of two - wheelers, based in India. In 2001, the company achieved the coveted position of being the largest two-wheeler manufacturing company in India and also, the 'World No.1' two-wheeler company in terms of unit volume sales in a calendar year. Hero Moto Corp Ltd. continues to maintain this position till date.

COMPANY PERFORMANCE
During the fiscal year 200809, the company sold 3.7 million bikes, a growth of 12% over last year. In the same year, the company had a market share of 57% in the Indian market. Hero Honda sells more two wheelers than the second, third and fourth placed twowheeler companies put together. Hero Honda's bike Hero Honda Splendor sells more than one million units per year. On 1 June 2012, Hero Moto Corp reported its highest ever monthly sales at 556,644 units in May, registering a growth of 11.28%.

SUPPLIERS
It is reported Hero Honda has five joint ventures or associate companies, Munjal Showa, AG Industries, Sunbeam Auto, Rock man Industries and Satyam Auto Components that supply a majority of its components.

MANUFACTURING
Hero Moto Corp two-wheelers are manufactured across three globally benchmarked manufacturing facilities. Two of these are based at Gurgaon and Dharuhera which are located in the state of Haryana in northern India. The third and the latest manufacturing plant are based at Haridwar, in the hill state of Uttarakhand.

16

TECHNOLOGY
In the 1980's the Company pioneered the introduction of fuel-efficient, environment friendly four-stroke motorcycles in the country. It became the first company to launch the Fuel Injection (FI) technology in Indian motorcycles, with the launch of the Glamour FI in June 2006. Its plants use world class equipment and processes and have become a benchmark in leanness and productivity. Hero Moto Corp, in its endeavor to remain a pioneer in technology, will continue to innovate and develop cutting edge products and processes.

DISTRIBUTION
The Company's growth in the two wheeler market in India is the result of an intrinsic ability to increase reach in new geographies and growth markets. Hero Moto Corp's extensive sales and service network now spans over to 5000 customer touch points. These comprise a mix of authorized dealerships, service & spare parts outlets and dealer-appointed outlets across the country.

MOTORCYCLE MODELS
CBZ, CBZ Star, CBZ-Xtreme MF-Dawn, MF-Deluxe (Self Start) Glamour, Glamour F.I Hunk Achiever Karizma, Karizma R, Karizma ZMR FI Passion Plus, Passion Pro Pleasure Splendor+, Super Splendor, Splendor NXG, Splendor PRO Hero Impulse launched in 2011 after the separation of Hero and Honda. Its India's first off-road and on road Bike. Hero Ignitor launched in 2012 Maestro

KEY MILESTONES OF HERO HONDA

1983

Joint Collaboration Agreement with Honda Motor Co. Ltd. Japan signed Shareholders Agreement signed Hero Honda Motors Ltd. Incorporated

1984

17

1985

First motorcycle 'CD 100' rolled out 100,000th motorcycle produced New motorcycle model - 'Sleek' introduced New motorcycle model - 'CD 100 SS' introduced 500,000th motorcycle produced Raman Munjal Vidya Mandir inaugurated - A School in the memory of founder Managing Director, Mr. Raman Kant Munjal New motorcycle model - 'Splendor' introduced 1,000,000th motorcycle produced New motorcycle model - 'Street' introduced Hero Honda's 2nd manufacturing plant at Gurgaon inaugurated 2,000,000th motorcycle produced

1987

1989

1991

1992

1994

1997

1998

1999 New motorcycle model - 'CBZ' introduced Environment Management System of Dharuhera Plant certified with ISO-14001 by DNV Holland Raman Munjal Memorial Hospital inaugurated - A Hospital in the memory of founder Managing Director, Mr. Raman Kant Munjal 2000 4,000,000th motorcycle produced Environment Management System of Gurgaon Plant certified ISO-14001 by DNV Holland Splendor declared 'World No. 1' - largest selling single two-wheeler model Hero Honda Passport Programmer - CRM Programmer launched 2001 New motorcycle model - 'Passion' introduced One million production in one single year New motorcycle model - 'Joy' introduced 5,000,000th motorcycle produced 2002 Becomes the first Indian Company to cross the cumulative 7 million sales mark Splendor has emerged as the World's largest selling model for the third calendar year in a row (2000, 2001, 2002) New motorcycle model - 'CD Dawn' introduced, New motorcycle model - 'Splendor +' introduced, New motorcycle model - 'Passion Plus' introduced, New motorcycle model 'Karizma' introduced

18

2004

New motorcycle model - 'Ambition 135' introduced Hero Honda became the World No. 1 Company for the third consecutive year. Crossed sales of over 2 million units in a single year, a global record Splendor - World's largest selling motorcycle crossed the 5 million mark New motorcycle model - 'CBZ' introduced Joint Technical Agreement renewed Total sales crossed a record of 10 million motorcycles

2005 Hero Honda is the World No. 1 for the 4th year in a row New motorcycle model - 'Super Splendor' introduced, New motorcycle model - 'CD Deluxe' introduced New motorcycle model - 'Glamour' introduced, New motorcycle model - 'Achiever' introduced First Scooter model from Hero Honda - 'Pleasure' introduced 2006 Hero Honda is the World No. 1 for the 5th year in a row 15 million production milestone achieved 2007 Hero Honda is the World No. 1 for the 6th year in a row New 'Splendor NXG' launched New 'CD Deluxe' launched New 'Passion Plus' launched New motorcycle model 'Hunk' launched 20 million production milestone achieved 2008 Hero Honda Haridwar Plant inauguration New 'Pleasure' launched Splendor NXG launched with power start feature New motorcycle model 'Passion Pro' launched New 'CBZ Xtreme' launched 25 million production milestone achieved CD Deluxe launched with power start feature New 'Glamour' launched New 'Glamour Fi launched 2009 Hero Honda Good Life Program launched Hunk' (Limited Edition) launched Splendor completed 11 million production landmark New motorcycle model 'Karizma - ZMR' launched Silver jubilee celebrations 2010 New model Splendor Pro launched Launch of new Super Splendor and New Hunk

19

2011

New licensing arrangement signed between Hero and Honda Launch of new refreshed versions of Glamour, Glamour FI, CBZ Xtreme, Karizma Crosses the landmark figure of 5 million cumulative sales in a single year July 29, 2011 - Hero Honda Motors changed its name to Hero Moto Corp following the exit of its erstwhile Japanese promoter, Honda, from the company

ACHIEVEMENTS/ RECOGNITION RECOGNITION

The new Hero is rising and is poised to shine on the global arena. Company's new identity "Hero Moto Corp Ltd." is truly reflective of its vision to strengthen focus on mobility and technology and creating global footprint. Building and promoting new brand identity will be central to all its initiatives, utilizing every opportunity and leveraging its strong presence across sports, entertainment and ground- level activation. Logo of Hero Honda, as the company was known till Aug. 2011.The Brand Trust Report published by Trust Research Advisory has ranked Hero Honda in the 13th position among the brands in India.

ACHIVEMENTS
2011

Two-wheeler Manufacturer of the Year award by Bike India magazine Adjudged the 'Bike Manufacturer of the Year' at the Economic Times Zig Wheels Car and Bike Awards Rated as Top Indian Company in Automobile - Two Wheelers sector by Dun & Bradstreet - Rolta Corporate Awards 2009 Most Preferred Brand of Two-Wheelers' award at the CNBC Awaaz Consumer Awards. Adjudged at top of the two-wheeler category in the Brand Equity Most Trusted Brands 2010 Survey Ranked No. 3 Most Trusted Brand across categories amongst Young Adult Males Company of the Year awarded by Economic Times Awards for Corporate Excellence 2008-09 CNBC TV18 Overdrive Awards 2010 'Hall of Fame' to Splendor NDTV Profit Car & Bike Awards 2010 - Two-wheeler Manufacturer of the Year, CnB Viewers' Choice Two-wheeler of the Year (Karizma ZMR) and Bike Maker of the Year.

2010

2009

'Two-wheeler Manufacturer of the Year' by NDTV Profit Car & Bike Awards 2009 and Passion Pro adjudged as CNB Viewers' Choice two-wheeler Top Indian Company under the 'Automobile - Two-wheelers' sector by the Dun & Bradstreet-Rolta Corporate Awards Won Gold in the Reader's Digest Trusted Brand 2009 in the 'Motorcycles' category NDTV Profit Business Leadership Awards 2009 - two-wheeler category

20

2008 NDTV Profit Business Leadership Award 2008 Top Gear Design Awards 2008 NDTV Profit Car India & Bike India Awards India Times Mindscape and Seville Row ( A Forbes Group Venture ) Loyalty Awards Asian Retail Congress Award for Retail Excellence (Strategies and Solutions of business innovation and transformation) NDTV Profit Car India & Bike India Awards Overdrive Magazine TNS Voice of the Customer Awards 2007 The NDTV Profit Car India & Bike India Awards 2007

PROMINENT AWARDS OF THE COMPANY AWARDS

2011
Two-wheeler Manufacturer of the Year award by Bike India magazine. Adjudged the "Bike Manufacturer of the Year" at the Economic Times Zig Wheels Car and Bike Awards. CNBC Awaaz - Storyboard special commendation for "Effective rebranding of a new corporate entity" by CNBC Awaaz Consumer Awards "Most Recommended Two-Wheeler Brand of the Year" award by CNBC Awaaz Consumer Awards Colloquy Loyalty Awards "Innovation in Loyalty Marketing International 2011" for Hero Good Life "Best Activity Generating Short or Long-Term Brand Loyalty" by the Promotion Marketing Award of Asia Order of Merit for Hero Good Life Ranked No 1 brand in the Auto (Two-Wheelers) category in the Brand Equity "Most Trusted Brand" 2011 survey

2010

Rated as Top Indian Company in Automobile - Two Wheelers sector by Dun & Bradstreet - Rolta Corporate Awards 2009 Most Preferred Brand of Two-Wheelers" award at the CNBC Awaaz Consumer Awards. Adjudged at top of the two-wheeler category in the Brand Equity Most Trusted Brands 2010 Survey. Ranked No. 3 Most Trusted Brand across categories amongst Young Adult Males Company of the Year awarded by Economic Times Awards for Corporate Excellence 2008-09. CNBC TV18 Overdrive Awards 2010 'Hall of Fame' to Splendor NDTV Profit Car & Bike Awards 2010

21

2009

'Two-wheeler Manufacturer of the Year' by NDTV Profit Car & Bike Awards 2009 and Passion Pro adjudged as Car and Bike Viewers' Choice two-wheeler Top Indian Company under the 'Automobile - Two-wheelers' sector by the Dun & Bradstreet-Rolta Corporate Awards Won Gold in the Reader's Digest Trusted Brand 2009 in the 'Motorcycles' category NDTV Profit Business Leadership Awards 2009 - two-wheeler category NDTV Profit Business Leadership Award 2008 - Hero Honda Wins the Coveted "NDTV Profit Business Leadership Award 2008" Asian Retail Congress Award for Retail Excellence (Strategies and Solutions of business innovation and transformation) - Best Customer Loyalty Program in Automobile category NDTV Profit Car India & Bike India Awards - Bike Manufacturer of the year Overdrive Magazine - Bike Manufacturer of the year TNS Voice of the Customer Awards No.1 executive motorcycle Splendor NXG No.1 standard motorcycle CD Deluxe No. premium motorcycle CBZ Xtreme

2008

2007

Overall "Bike of the Year" - CBZ X-treme "Bike of the Year" - CBZ X-treme (up to 150 cc category) "Bike Technology of the Year" - Glamour PGM FI "Auto Tech of the Year" - Glamour PGM FI by Overdrive Magazine. "Bike of the Year" - CBZ X-treme by Overdrive Magazine. Ranked CBZ X-treme "Bike of the Year" - by B S Motoring Magazine "Most Trusted Company", by TNS Voice of the Customer Awards2006 CD Deluxe rated as "No 1 standard motorcycle" by TNS Voice of the Customer Awards2006.

2006
Adjudged 7th Top Indian Company by Wall street Journal Asia (Top Indian Two Wheeler Company). One of the 8 Indian companies to enter the Forbes top 200 list of world's most reputed companies. No. 1 in automobile industry by TNS Corporate Social Responsibility Award. Best in its class awards for each category by TNS Total Customer Satisfaction Awards 2006 Splendor Plus (Executive) CD Deluxe (Entry) Pleasure (Gearless Scooters) Bike of the Year - Achiever (up to 150 cc category) Bike of the Year - Glamour (up to 125 cc category) NDTV Viewers' Choice Award to Glamour in the bike category

22

2005

Awaaz Consumer Awards 2005 - India's most preferred two-wheeler brand by CNBC in the 'Automobiles' category. Bike Maker of the Year Award by Overdrive Magazine. ICWAI National Award for Excellence (Second) in Cost Management 2004 in the private sector category by ICWAI. 10th Motilal Oswal Wealth Creator Award for as the most consistent wealth creator for the period 1991-2005. Winner of the Review 200 Asia's Leading Companies Award (3rd Rank amongst the top 10 Indian companies). GVC Level 1 (Highest Rating) by CRISIL for corporate Governance. Adjudged as the Best Value Creator - Large Size Companies 2003-04 by The Outlook Money. Corporate Excellence Award 2004 by Indian Institute of Materials Management. Adjudged as the Organization with Innovative HR Practices by HT Power Jobs for HR Excellence. ICSI National Award for Excellence in Corporate Governance 2004 by the Institute of Company Secretaries of India.

2004

2003

Winner of the Review 200 - Asias Leading Companies Award (3rd Rank amongst the top 10 Indian companies). Most Respected Company in Automobile Sector by Business World. Bike Maker of the Year by Overdrive Magazine. Bike Maker of the Year by Overdrive Magazine. Winner of the Review 200 - Asias Leading Companies Award (4th Rank amongst the top 10 Indian companies). Company of the Year of ET Awards for Corporate Excellence. Ranked 4th in 'Overall Best Managed Company' category, ranked 3rd in 'Best Financial Management' and 'Best Operational Efficiency' category, ranked 6th in 'Overall Best Investor Relations' category, by Asia money. Highest Wealth Creating Company of the Year Award by the Money. GVC Level 1 (Highest Rating) by CRISIL for Corporate Governance.

2002

2001 Bike Maker of the Year by Overdrive Magazine. Winner of the Review 200 - Asias Leading Companies Award (9th Rank amongst the
top 10 Indian Companies). Winner of Three Leaves Award for showing Corporate Environment Responsibility in the Automobile Sector by Centre for Science & Environment.

1999
National Productivity Award for the Best Productivity Award in the category of Automobile & Tractor presented by Vice President of India 1995

23

1991

Economic Times-Harvard Business School Award for Corporate Performance to Hero Honda Motors Ltd.

2011-12 PERFORMANCE
Total unit sales of 54,02,444 two-wheelers, growth of 17.44 per cent Total net operating income of INR 19401.15 Crores, growth of 22.32 per cent Net profit after tax at INR 1927.90 Crores Total dividend of 5250% or INR 105 per share including Interim Dividend of INR 70 per share on face value of each share of INR 2 each EBIDTA margin for the year 13.49 per cent EPS OF INR 96.54

THE CHAIRMAN (BRIJMOHAN LALL MUNJAI)

Instinctive from a young age, Brijmohan Lall made a rather unusual start in life. Around the time when the freedom movement in India was taking shape in the late 1920s, he walked into a newly opened Gurukul (Indian heritage school) near his home in Kamalia (now in Pakistan). He was only six years old then. Thus began an extraordinary tale of courage and perseverance. Brijmohan began his business story after partition in 1947, when he and his brothers relocated to Ludhiana. The family set up a company that provided poor people with basic transport (cycles). Three decades later, as India evolved; he added a second crucial chapter - which visualized affordable and technologically superior transport to millions of middle class Indians. The rest is history.

BUILDING RELATIONSHIPS
"Don't dream if you can't fulfill your dreams'' Brijmohan Lall Munjal is often fond of saying. The founder and patriarch of the $3.2 billion Hero Group is your classic first generation entrepreneur. He is a man who started small, dreamt big and used a combination of grit and perseverance to create one of the country's largest corporate groups and the World's No.1 Two Wheeler Company. When Brijmohan and his brothers started out, there was no concept of organized dealer networks. Companies just produced, and most dealers functioned like traders. Brijmohan changed the rules of the business by trusting his gut instincts; introducing business norms that were ahead of their time, and by investing in strategic relationships. Brijmohan built a series of bonds and networks with hundreds of family members, vendors, dealers and employees. Much like the Japanese keiretsu system, these networks are now the glue that holds.

24

"Thanks to the relationships that we have nurtured so passionately in the Hero Family, the younger generations of some of our bicycle dealers have become dealers of Hero Moto Corp. These relationships have survived through generations - through bad times and good times'' the patriarch now reminiscences. Besides bonding with his vendors and dealers, Brijmohan has been personally responsible for kindling a spirit of entrepreneurship amongst his employees, and today, 40 of his former employees are successful entrepreneurs.

STAYING AHEAD
Though not technically qualified in the conventional sense, few of his contemporaries have understood the dynamics of technology better than Brijmohan Lall has. He could always visualize the applicability of technology before others could. For example, in the 1980s, when all two-wheeler companies in India opted for two-stroke engine technology, Brijmohan preferred a four-stroke engine - a technology that dramatically increased fuel efficiency and reduced maintenance costs. This technology was one of the biggest reasons for Hero Moto Corp's stupendoussuccess.

A CORPORATE CITIZEN
A frugal upbringing and a value system modeled on the famous Gurukul system - which stresses the sanctity of the teacher-pupil relationship - imbibed in Brijmohan a strong sense of social commitment and responsibility. There is a special place in his heart for Ludhiana, the city where he took roots. Today, Ludhiana is a modern, bustling city, but Brijmohan has played no mean role in its evolution. Several schools and educational institutions in Ludhiana owe their existence to the Munjal family. The Ludhiana Stock Exchange owes its existence to Brijmohan's vision as does the Ludhiana Flying Club. He has also set up the not-for-profit Dayanand Medical College and Hospital - an institute now rates as one of the best medical colleges in India, in terms of infrastructure, quality of staff and alumni profile. In and around Dharuhera, near the first Hero Moto Corp plant, Brijmohan and his family have left their stamp of philanthropy. The Raman Kant Munjal Foundation, which Brijmohan set up in memory of his eldest son, today runs a higher secondary school and a very modern and well-equipped 100-bed hospital at Dharuhera. The group has also adopted numerous villages and provides education, vocational training, drinking water, roads, streetlights and sewerage.

25

AWARDS TO THE CHAIRMAN

2011
Lifetime Achievement Award by TERI Lifetime Achievement Award by Ernst & Young Lifetime Contribution Award by All India Management Association

2010
Business Leader by Lakshmipat Singhania - IIM, Luck now National Leadership Awards 2009 Pride of Nation Award by the Doon Citizens Council

2006
'Lifetime Achievement Award' for Translating Excellence in Corporate Governance into Reality by The Institute of Company Secretaries of India

2005
Indian Automotive Hall of Pride by Overdrive CNBC TV18 Commendation of Business Leadership displaying extraordinary Corporate Leadership and Entrepreneurial Spirit Padma Bhushan by Government of India Doctor of Letters (Honoris Causa) by Hemwati Nandan Bahuguna Garhwal University, Srinagar Garhwal Lifetime Achievement Award by ET Awards for Corporate Excellence

2004
Life Time Achievement Award for Management by All India Management Association D. Litt. (Honoris Causa) by Banaras Hindu University Lifetime Achievement Award by Amity Business School Lifetime Achievement Award by HT Power Jobs

2002
'Entrepreneur of the Year Award by Business Standard Giants International Award to the Chairman in the field of Business & Industry Business Leadership Award by Madras Management Association

2001
Entrepreneur of the Year Award by Ernst & Young

2000
Sir Jehangir Ghandy Medal for Industrial Peace - by XLRI, Jamshedpur

1998
Business Leader of the Year by Business Baron

1997
Distinguished Entrepreneurship Award by PHD Chambers of Commerce & Industry

26

CORPORATE ANNOUNCEMENT GROWTH PROCESS SUCCESS REPORT

Jan, 2012 Hero Moto corp. Rides On Highest-Ever Quarterly Sales To Report Its BestEver Turnover Of Rs. 6031 Crores In Q3, Fy12 Pbt Stands At Rs 724 Crore & Pat Stands At Rs. 613 Crore Ebidta Margin For The Quarter At 15.6 Per Cent Volume Sales During The Quarter At 15,89,286 Units, Growth Of 11.3%. New Delhi, January 19, 2012: Riding on its highest-ever quarterly volume sales of15,89,286 units, Hero Moto Corp Ltd (HMCL), the worlds largest two-wheeler manufacturer, today reported its best-ever turnover (Net Sales & Other Operating income) of Rs. 6031.45 crores for the third quarter (October-December 2011) of FY12. This is a growth of 16.85 per cent over the corresponding period in the last fiscal (October-December 2010) of FY 11. The companys profit before tax for the period stood at Rs 723.79 crores, while profit after tax (PAT) for the period stood at Rs 613.03 crores. The company has recorded an EBIDTA margin of 15.63 per cent. Hero Moto Corp registered its highest ever quarterly sales of 15,89,286 two-wheelers in the third quarter this fiscal, fuelled by consistent half million-plus unit sales in all the three months of the quarter - 512,238 units in October, 536,772 units in November and 540,276 units in December. Dr. Brijmohan Lall, Chairman, Hero Moto Corp Ltd. Said, Last quarter has been particularly satisfying as we have set new benchmarks of excellence. This should help us realize our larger vision of building a truly global company with a strong Indian foundation. We are optimistic about the New Year and will continue to provide the best of technology and products to our customers. Mr. Pawan Munjal, Managing Director & Chief Executive Officer, Hero Moto Corp Ltd., said It is heartening to see that our sales have been in excess of half a million twowheelers in every month of the quarter, thus further strengthening our leadership. We are well in line to meet our guidance for over six million unit sales in the fiscal 2012. In FY12 the industry has been facing constraints of rising fuel prices, high interest rates and sharp rupee depreciation, leading to increased input costs impacting the margin. In these challenging times, while the domestic industry is witnessing a growth of 15 per cent, we at Hero Moto Corp are growing faster than that. We have also seen a softening in commodity prices of late, which has, however, been off-set by the rupee depreciation. Therefore, while we expect market demand for two-wheelers to remain stable, a lot will depend on the overall economic.

27

Hero Moto Corp recently demonstrated its intent and vision for the future, with the unveiling of a Hybrid Concept Scooter Leap here at the recently-concluded Auto Expo. The company, which is fast enhancing its research and development (R&D) capabilities, is currently developing this hybrid technology to bring environment-friendly two-wheelers into the country. The company has also been in discussion with international design houses and technology suppliers for collaboration to develop new models. Hero Moto Corp also outlined its strategic plans for the year, unveiling a range of its new generation of two-wheelers an all-new 110cc Passion X Pro, a 110cc masculine scooter, Maestro, and a thrilling new 125cc bike, Ignitor - to be launched in the Indian market over the next few months. Hero Impulse the first bike to be launched by the company under its new brand name has opened up a new segment in the Indian two-wheeler market the on-road-off-road category. The bike has immediately caught the imagination of customers and experts alike. Impulse won the overall Bike of the Year and the Bike of the Year (up to 150cc) award at the ET Zig wheels Car & Bike of the Year Awards 2011, while it was also adjudged the Bike of the Year (up to 160cc) at the NDTV Car & Bike Awards 2011.

BOARD OF DIRECTORS
Director name: Brijmohan Munjal Pawan Munjal Sunil Kant Munjal Suman Kant Munjal Paul Edgerley Ved Prakash Malik Ravi Nath Meleveeti Damodaran Pradeep Dinodia Pritam Analjit Singh Anand C Burman Llam C Kamboj Designation: Chairman Managing Director & Chief Executive Officer Non-Executive Independent Director Non-Executive Independent Director Non-Executive Independent Director Joint Managing Director Joint Managing Director Joint Managing Director Joint Managing Director Joint Managing Director Joint Managing Director Joint Managing Director Singh Company Secretary

28

INTIATIVES
An environment and socially, aware company at Hero Honda, our goal is not only to sell you a bike, but also to help every step in making your world better place to live in. Besides it will provide a high quality service to all its customers. Hero Honda takes a stand as a socially responsibility enterprise respectful of its environment and respectful of the important issues. Hero Honda has been strongly committed not only to environment conservation programmers but also expresses the increasingly inseparable balance between the economic concerns and the environmental and social issues faced by a business; business must not grow at the environmental and mans future but rather must serve mankind.

PROFILE OF THE DEALER

Sri Varalakshmi Hero Motors Pvt. Ltd. is one of the biggest Hero show room in the Viziayanagaram District. It is existed in the District head quarters (Viziayanagaram) and the heart of the city. It has been established in 2005 28th Aug as Hero Authorized Dealer Mr. Sri Ram Venkata Reddy is the Managing Director of the company. Sri Varalakshmi Hero Motors Pvt. Ltd. is selling around 1000 vehicles per year and around 115 employees are working in the company. Marketing and Sales department has one Marketing Manager 4 marketing executives and 10 members sales team. Sri Varalakshmi Hero Motors Pvt. Ltd. has a huge automates workshop for servicing of the vehicles. Daily around 250 vehicles are serviced and repaired in the servicing center. Workshop has one service manager, technical supervisors and skilled mechanics. Sri Varalakshmi Hero Motors Pvt. Ltd. had linked with HDFC, ICICI and Centurion Banks to finance the customers who wish to buy the vehicles in finance. Monthly the company maintains 300 vehicles as opening stock and sells 250 vehicles. The company authorities invested 2 crores to shape the company Personnel the Assert Of the Sri Varalakshmi Hero Motors Pvt. Ltd

PRODUCTS
Sri Varalakshmi Hero Motors Pvt. Ltd. has franchise of Hero Company. Hero Company manufactures various types of motorcycles. These are: Hero CBZ Xtreme. Hero CD 100 SS. Hero MF-Dawn Hero MF-Deluxe (Self Start).

29

Hero Glamour F.I. Hero Hunk. Hero Achiever. Hero Karizma R. Hero Karizma ZMR FI. Hero Passion Pro. Hero Pleasure. Hero Splendor+. Hero Super Splendor. Hero Splendor PRO. Hero Impulse launched in 2011 after the separation of hero and Honda. Hero Ignitor launched in 2012. Hero Maestro.

CONSUMER FACILITIES AT SERVICING CENTER

Automated Workshop. Quick Service. Break down servicing. Lounge for customers with A.C. Phone Rest room with A.C. Free replacement of split pin and tube cap. TV with cable. RTA approved pollution check up. Free drop facility.

SERVICES OFFERED
The services offered to the customers in Varalakshmi Motors are: Three free services and paid service after sale of motor cycle. Free checkup campaign. Finance through Banks. Demonstrations of new products. Acceptance of warranty claim.

30

EMPLOYEES IN SRI VARALAKSHMI HERO MOTORS PVT. LTD

Sri Varalakshmi Hero Motors Pvt. Ltd Headed by Mr. Sri Ram Venkata Reddy, who is Managing Director. It had various departments- Accounts department, Sales department, Spares department and Workshops. Total employees in Sri Varalakshmi Hero Motors Pvt. Ltd are around 115 members in various departments, members are employed; employees in account department; members in spares department; and in workshop are employed.

SALES
Sales of the Sri Varalakshmi Hero Motors Pvt. Ltd are higher than any teo-wheelers company in Viziayanagaram: YEAR NO. OF UNITS 2005-06 2,223 2006-07 3,938 2007-08 4,149 2008-09 4,983 2009-10 5,295 2010-11 5,600 2011-12 6,200 In its workshop, daily 80 to 100 customers are servicing their vehicles. The workshop per day income is about Rs.35,000 to 55,000.

ORGANIZATIONAL STRUCTURE Managing Director General Manager

Manager of Whole sales Manager of Spares Sales Manager of Services Finance manager of accounting

Executives

Executives

Floor and Service Suprvisor

Executives of showroom

Executives of Outdoor

Technicians

Executives

31

CHAPTER: III
THEORETICAL FRAMEWORK TOPIC RELATED CONCEPTS REVIEW OF LITERATURE REGULATORY FRAMEWORK

32

DISCOUNTS
Discounts and allowances are reductions to a basic price of goods or services. They can occur anywhere in the distribution channel, modifying the manufacturers list price, the price or the list price. There are many purposes for discontinuing, including; to increase short-term sales, to move out-of-date stock, to reward valuable customers, to encourage distribution channel members to perform a function, or to otherwise reward behaviors that benefit the discount issuer. Some discounts and allowances are formed of sales promotion.

DISCOUNT AND ALLOWANCES TYPES

The most common type of discounts and allowances are listed below:

TRADE DISCOUNT
Deduction in price given by the Wholesaler/Manufacturer to the retailer at the list price or catalogue price.

CASH DISCOUNT
Reduction in price given by the creditor to the debtor is known as cash discount. The discount is intended to speed payment and thereby provide liquidity to the firm. They are sometimes used as a promotional device.

PREFERRED PAYMENT METHOD DISCOUNT

Some retailers (particularly small retailers with low margins) offer discounts to customers paying with cash, to avoid paying fees on credit card transactions.

PARTIAL PAYMENT DISCOUNT

Similar to the Trade discount, this is used when the seller wishes to improve cash flow or liquidity, but finds that the buyer typically in unable to meet the desired discount deadline. A partial discount for whatever payment the buyer makes helps the sellers cash flow partially.

FORWARD DATING
This is where the purchaser doesnt pay for the goods until well after they arrive. The date on the invoice is moved forward.

33

Example:-purchase goods in November for sale during the December holiday season, but payment date on the invoice is january7.

SEASONAL DISCOUNT
These are price reductions given when an order is placed in a slack period (example: purchasing skis in April in the northern hemisphere or in September in the southern hemisphere). On a shorter time scale, a happy hour may fall in this category. Generally, this discount is referred to as X-Dating or EX-Dating. An example of X-Dating would be: the buyer must pay within 30 days of the invoice date, but will receive a 3% discount if they pay within 7 days after the end of the month indicated on the invoice date plus an extra 10 days.

DISCOUNTS AND ALLOWANCES DEALING WITH TRADE BARGAINING

Bargaining is where the seller and the buyer negotiate a price, which the buyer hopes in lower than the marketed price.

TRADE DISCOUNT (FUNCTIONAL DISCOUNT)

These are payments to distribution channel members for performing some function. Examples of these functions are warehousing and shelf stocking. Trade discounts are often combined to include a series of functions, for example 20/12/5 could indicate a 20% discount for warehousing the product, an additional 12% discount for shipping the product, and an additional 5% discount for keeping the shelves stocked. Trade discounts are most frequent in industries where retailers hold the majority of the power in distribution channel (referred to a channel captains).

TRADE-IN DISCOUNT
This can be a way of reducing the price. By offering more for a trade- in than it is actually worth, the net effect is to reduce the effective price earned by the seller. The advantage of this is it encourages replacement sales without altering the list price or the perceived value.

TRADE RATE DISCOUNT

A discount offered by a seller to a buyer in a related industry. For example, a pharmacist might offer a discount for over-the-counter drugs to physicians who are purchasing them for dispensing to the physicians own patients.

34

DISCOUNTS AND ALLOWANCES DEALING WITH QUANTITY

These are price reductions give for large purchases. The rationale behind them is to obtain economies of scale and pass some (or all) of these saving on to the customer. In some industries, buyer groups and co-ops have formed to take advantage of these discounts. Generally they are two types:

CUMULATIVE QUANTITY DISCOUNT (ACCUMULATION DISCOUNT)

These are price reductions based on the quantity purchased over a set period of time. The expectation is that they will implied switching cost and thereby bond purchaser to the seller.

NON-CUMULATIVE QUANTITY DISCOUNT

These are price reductions based on the quantity of a single order. The expectation is that they will encourage large orders, thus reducing billing, order filling, shipping, and sales personal expenses.

DEPENDENCE OF PRICE OF QUANTITY

An extreme form of quantity discount is when, within a quantity range, the price does not depend on quantity: If one wants less than the minimum amount one has to be pay for the minimum amount anyway. If one wants an amount between two of the fixed amounts on offer, one has to pay for the higher amount. These also apply in the case a service with Quantity referring to time. For example, an entrance ticket for zoo is usually for a day; if one stays Shorter, the price is the same. It is a kind of pass for unlimited use of a service during a day, where one can distinguish whether or not, when leaving and returning, one has to pay again. Similarly a pass can be for another period. In the case of long periods, it is obvious that one can leave and return without paying again. If one has to buy more than one wants, we can distinguish between the surplus just not being used, and the surplus being a nuisance, e.g. because of having to carry a large container.

35

DISCOUNTS AND ALLOWANCES DEALING WITH CUSTOMER CHARACTERISTICS DISABILITY DISCOUNT

A discount offered to customers with a disability. Depending on the type of business or setting, what is considered a disability may vary.

EDUCATIONAL DISCOUNT (STUDENT DISCOUNT)

These are price reduction given to members of educational institutions, usually students but possibly also to educators and to other institution staff. The rationale is to build brand awareness early in a buyers life. And/or to build product familiarity early so that when a studen t graduates, He/she is more likely to buy the same product for work at its normal price educational discounts are traditionally given by merchants directly, or via a student discount program such as NUS and student discounts.co.uk in the united kingdom or Enhance in united states.

EMPLOYEE DISCOUNT
A discount offered internally to the employees of a company that sell goods and/or services. This is used to entice more people interested in the goods/services of the company to work for the company to receive the discount, and then for the hired employees to put their wages right back into the company by purchasing the goods/services. Other perceived benefits of this discount include: Reaching out to potential employees that could be knowledgeable in the goods/ services the company offers by offering a discount on that they like. Reduce employee theft by making the hired employees feel they are already getting the items at a great price. Keep current employees from leaving if they cannot also leave the discount they receiving behind.

MILITARY DISCOUNT
A discount offered to customers who are and/or were enlisted in military services. The rationale may be that the service member is assumed to be on a limited budget, or it may be a way for the retailer to show support for members.

36

SENIOR DISCOUNT
A discount offered to customers who are above a certain age, typically 50, 55, or 60; the exact age varies with business or setting. The rationale for a senior discount is that the customer is assumed to be retired, and/or have a limited income, and/or living on a budget.

TODDLER DISCOUNT (CHILD, KID DISCOUNT)

A discount offered to children younger than a certain age, very common with regard an admission fees to entertainments and attractions. Another form of this discount is a kids eat free type of promotion. Often there is a requirement that the child must be accomplished by an adult paying full price.

SPECIAL PRICES OFFERED TO FRIENDS OF THE SELLERS

A discounted price offered to friends of salesperson, an attitude which is parodies in the stereotype of a salesman saying. It costs such-and such, but for you in Australia and New Zealand, discounts to friends are known as mates rates. In French this discounts is known as prix dami.

SPECIAL PRICES OFFERED TO LOCAL RESIDENTS

Common in tourist destinations, this discount is intended to promote local patronage. In Hawaii, for example, many tourist attractions, hotels, and restaurants charge a deeply discounted price to someone who shows a Hawaii drivers license or other proof that they live in Hawaii: this is known as a Kamaaina discount. After the Hawaiian word for an old-timer or native.

COUPONS
A discount, either of a certain specified amount or a percentage to the holder of a voucher, usually with certain terms commonly, the terms involve the terms of other discounts on the page , such as being valid only if a certain quantity is bought or only if the customer is as senior. Coupons can be distributer in places like news papers, brochures, and the internet.

REBATES
A refund or part of sometime the full price of the product following purchase, though some rebates are offered at the time of purchase.

37

OTHER DISCOUNTS AND ALLOWANCES PROMOTIONAL ALLOWANCES

These are price reductions give to the buyer for performing some promotional activity. These include an allowance for creating and maintaining an in-store display or co-op advertising allowances

BROKERAGE ALLOWANCES
From the point of view of the manufacturer, any brokerage fee paid is similar to a promotional allowance. It is usually based on percentage of the sales generated by the broker.

DISCOUNTING
It is a financial mechanism in which a debtor obtains the right to delay payments to a creditor, for a defined period of time, in exchange for a charge or fee. Essentially, the party that owes money in the present purchases the right to delay the payment until some future date. The DISCOUNT, or CHARGE, is simply the difference between the original amount in the present and the amount that has to be paid in the future to settle the debt.

DISCOUNT RATE
The discount rate which is used in financial calculations is usually chosen to be equal to the Cost of Capital. The Cost of Capital, in financial market equilibrium, will be the same as the Market Rate of Return on the financial asset mixture the firm uses to finance capital investment. Some adjustments may be made to the discount rate to take account of risks associated with uncertain cash flows, with other developments.

REVIEW OF LITERATURE
On this problem a little work is done till now. Researcher could consult only limited literature, which is available in library i.e. Indian journal of marketing, Business world & Business today, Business India. In spite of these above mentioned journal & magazines, various website of Companies are also consulted.

38

REGULATORY FRAMEWORK EVALUATION OF THE INDIAN TWO-WHEELER INDUSTRY

Automobile, being the leader in product and process technologies of the manufacturing sector, has been recognized as one of the major drivers of economic growth. The Indian economy has been growing around 8% for the past few years. This growth has enabled an overall change in the social status of the Indian population. Additionally, every year, many rural areas and Tier-III cities are progressing to a higher status, opening immense growth opportunities for the two- wheeler industry. The two-wheeler market has emerged as the most vibrant and transforming segment of the overall Indian automobile industry, witnessing an unprecedented growth. Rising rural demand and fuel efficiency are among the major factors boosting the growth in the market. Despite the economic slowdown, the Indian automobile industry has been performing consistently well, compared to other major markets of the world. The Indian two-wheeler market possesses a significant potential, and is anticipated to grow at a CAGR of around 11% during FY 2011- 2015 to reach 17.8 Million Units by FY 2015-end. The two wheeler industry (henceforth TWI) in India has been in existence since 1955. It consists of the segments viz., scooters, motorcycles and mopeds. The increase in sales volume of this industry is proof of its high growth. In 1971, sales were around 0.1 million units per annum. But by 1998, this figure had risen to 3 million units per annum. Similarly, capacities of production have also increased from about 0.2 million units of annual capacity in the seventies to more than 4 million units in the late nineties. The TWI in India began operations within the framework of the national industrial policy as espoused by the industrial policy resolution of 1956(See government of India 1980, 1985, 1992). This resolution divided the entire industrial sector into three groups, of which one contained industries whose development was the exclusive responsibility of the state, another included those industries in which both the state and the private sector could be developed exclusively under private initiative within the guidelines and the objectives lay out by the five year plans (CMEI, 1990) and foreign investment respectively. Set of industries. This set of controls on the economy in the seventies caused several firms to a) Operate below the minimum scale of efficiency (henceforth MES), b) Under-utilize capacity, and c) Use outdated technology.

39

While operations below MES resulted from the fact that several incentives were given to smaller firms, the capacity under-utilization was the result of i) The capacity mix being determined independent of the market demand ii) The policy of distributing imports baed on capacity, causing forms to expand beyond levels determined by demand so as to be eligible for more imports. Use of outdated technology resulted from restrictions placed on import through the provisions of FERA. Recognition of the deleterious effects of these policies led to the initiate of reforms in 1975, which took on a more pronounced shape and acquired wider scope under the New Economic Policy (NEP) in 1885. As part of these reforms-several groups of industries were de-licensed and broad banding was permitted in select industries. Controls over capacity expansion were relaxed through the specification of the MES6 of production for several industries. Foreign investment was allowed in select industries and norms under the MRTP act were relaxed. These reforms led to a rise in the trend rate of growth of real GDP from 3.7% in the seventies to 5.6% in the eighties. However the major set of reforms came in 1991 in response to a series of macroeconomic crises that hit the Indian economy in 1990-91. Several industries were deregulated, the Indian rupee was devalued and made convertible on the current account and tariffs replaced quantitative restrictions in the area of trade. The initiation of reforms led to a drop in the growth of real GDP between1990-92, but this average at about 5.5% per annum after 1992. The decline in GDP in the years after reforms was the outcomes of devaluation and the concretionary fiscal and monetary Policies in 1991 to address the foreign exchange crisis. Thus the industrial policy in India moved from a position of regulation and right control in the sixties and seventies to a more liberalized one in eighties and nineties. The two-wheeler industry in India has, to a great extent been shaped by the evolution of the industrial policy of the country. Regulatory policies like FERA and MRTP caused the growth of some segments in the industry like motorcycle to stagnate. These were later able to grow (both in terms of overall sales volumes and number of players) once foreign investments were allowed in 1981. The reforms in

A) 1960-1969
The automobile industry being classified as one of importance under the industrial policy resolution of 1948 was therefore controlled and regulated by the government. In order to encourage manufacturing, besides restricting import of complete vehicles, automobile assembler firms were phased out by 1952 (Tariff Commission, 1968), and only manufacturing firms allowed continuing. Productions of automobiles were licensed, which meant that a firm required a licensing approval in order to open a plant.

40

It also meant that the government determined a firms capacity of production. During this period, collaborations with foreign firms were encouraged. Table 1 illustrates the fact that most firms existing in this period had some form of collaboration with foreign firms. Table 1 also gives the details of the various firms that existed in the industry during this time period and the products they manufactured.

B) 1970-1980
This was a period during which all the overall growth rate of the two-wheeler industry was high (around 15% per annum). Furthermore, the levels of restriction and control over the industry were also high. The former was the result of the steep oil price hikes in 1974 following which two-wheelers became popular modes of personal transport because they offered higher fuel efficiency over cars/jeeps. On the other hand, the introduction of regulatory policies such as MRTP and FERA resulted in a controlled industry. The impact of MRTP was limited as it affects only large firms like Baja Auto ltd. Whose growth rates were curbed as they came under the purview of this act. However, FERA had a more far-reaching effect as it caused foreign investment in India to be restricted. In the motorcycles segment FERA did not because technological stagnation, as consequence of which, new products nor firms entered the market since this segment depended almost entirely on foreign collaborations for technology. The scooter and mopped segments on the other hand were technologically more self-sufficient and thus there were two new entrants in the scooter segment and three in the moped segment.

C) 1981-1990
The technological backwardness of the Indian two-wheeler industry was one of the reasons for the initiation of reforms in 1981. Foreign collaborations were allowed for all twowheelers up to an engine capacity of 100 CC. This prompted a spate of new entries into the industry (Table1) the majority of which entered the motorcycle segment, bringing with them new technology that resulted in more efficient production processes and products. The variety in products available also improved after broad banding was allowed in the industry in 1985 as a part of NEP. This, coupled with the announcement of the MES of production for the twowheeler industry, gave firms the flexibility to choose an optimal product and capacity mix which could better incorporate market demand into their production strategy and thereby improve their capacity utilization and efficiency. These reforms had two major effects on the industry. First, licensed capacities went up to 1.1 million units per annum overshooting the 0.675 million units per annum target set in the sixth plan. Second, several existing but weaker players died out giving way to new entrants and superior products.

41

D) 1991-1999
The reforms that began in the late seventies underwent their most significant change in 1991 through the liberalization of the economy. The two-wheeler industry was completely deregulated. In the area of trade, several reforms were introduced with the goal making Indian exports competitive. The two-wheeler industry in the nineties was characterized by An increase in the number of brands available in the market which caused forms to complete on the basis of product features. Increase in sales volumes in the motorcycles segment vis--vis the scooter segment reversing the traditional trend. The period between 1998-2001 is considered to be significant in the history of Indian two-wheeler industry, as it saw and end of at least three alliances. First to go was that between Kinetic and Honda. In November 1998, after protracted negotiations, in which Honda tried to take over completely, and the Firodias refused to surrender, Honda sold its shares to the Kinetic Group. In 2000, Yamaha and Escorts parted ways with the Nandas-controlled Escort Group selling shares to the Japanese manufacturer. During this period, the TVS group Suzuki Motorcycle parted ways.

42

CHAPTER IV

ANALYSIS OF STUDY

43

CUSTOMER PROFILE

A. AGE (IN YEARS)

TABLE - 1 AGE GROUP NO OF RESPONDENTS PERCENTAGE 18-24 52 26% 25-34 76 38% 35-44 42 21% 45-54 16 8% >54 14 7%

GRAPH 1

AGE
>54, 14, 7%

45-54, 16, 8% 18-24, 52, 26%

18-24 35-34 35-44

35-44, 42, 21%

45-54 >54

35-34, 76, 38%

INTERPRETION: The age composition of respondents reveals that the respondents in the age group 18-24 were 26% and 25-34 were 38% and 35-44 were 21% and 45-54 were 8% and 7% were above 64 years of age. This shows that majority of the respondents were in the age group of 25-34 years.

44

B. EDUCATION ANALYSIS:

TABLE 2
EDUCATION NO OF RESPONDENTS PERCENTAGE GRADUATE 75 38% POST GRADUATE 65 32% ILLITERATE 60 30%

GRAPH 2

EDUCATION
ILLITERATE, 60, 30% GRADUATE 75 38% GRADUATE POST GRADUATE ILLITERATE

POST GRADUATE 65 32%

INTERPRETATION: The education of the respondents reveals that 30% illiterate which are least, 38% graduates, and 32% post graduate. The analysis reveals that majority are graduates followed by post graduates

45

C. OCCUPATION ANALYSIS:

TABLE - 3
OCCUPATION NO OF RESPONDENTS PERCENTAGE PROFESSIONAL 48 24% BUSINESS 44 22% GOVT. SERVICES 56 28% EMPLOYEE 42 21% ANY OTHERS 10 5%

GRAPH 3

OCCUPATION
ANY OTHERS, 10, 5% EMPLOYEE, 42, 21% PROFESSIONAL, 48, 24% PROFESSIONAL BUSINESS GOVT. SERVICES EMPLOYEE BUSINESS, 44, 22% GOVT. SERVICES, 56, 28% ANY OTHERS

INTERPRETATION: The occupation of the respondents reveals that 5% of the others which are least, 22% are business people, 24% professionals, 21%empyloyees, and 28% Govt. Services. The analysis revels that majority are Govt. Services followed by professional whose uses the two-wheelers.

46

D. MONTHLY INCOME ANALYSIS:

TABLE 4
MONTHLY INCOME (IN Rs.) NO OF RESPONDENTS PERCENTAGE 10,000<10,000 20,000 34 17% 84 42% 20,000- 30,00030,000 40,000 52 26% 22 11% 40,00050,000 >50,000 4 2% 4 2%

GRAPH 4

40,000 50,000, 4, 2%

INCOME ANALYSIS
>50,000, 4, 2% <10,000, 34, 17% <10,000

30,000-40,000, 22, 11% 20,00030,000, 52, 26% 10,000-20,000, 84, 42%

10,000-20,000 20,000-30,000 30,000-40,000 40,000-50,000 >50,000

INTERPRETATION: Income status reveals that people earning less than Rs. 10,000 at amount were 17%, 42% of the respondents were earning Rs.10,000-20,000 a month, 26% were earning Rs. 20,00030,000 per month, 11% were earning Rs.30,000-40,000 a month, 2% were earning 40,00050,000 per month and 2% were earning >50,000 per month. This analysis shows that the respondents who were earnings a monthly income of 10,000-20,000 a month were more and it is observed that 79% were earning more than Rs.20,000 a month and hence could afford to buy a two-wheelers.

47

E. GENDER ANALYSIS:

TABLE - 5

GENDER NO OF RESPONDENTS PERCENTAGE

MALE 146 73%

FEMALE 54 27%

GRAPH 5

GENDER
FEMALE, 54, 27%

MALE FEMALE

MALE , 146, 73%

INTERPRETATION: From the above table, we can observe that among 146 respondents that means 73% of males and 54 respondents means 27% are females. Males are more than females on our survey.

48

1. DO YOU HAVE ANY TWO-WHEELER?

TABLE 6

OWN TWO-WHEELER NO OF RESPONDENTS PERCENTAGE

YES 162 81%

NO 38 19%

GRAPH 6

OWN TWO-WHEELER
NO, 38, 19%

YES NO

YES, 162, 81%

INTERPRETATION: HERO the number of respondents who said that they owned a two-wheeler was 81% and respondents who did not own were only 19%. This shows that large number of respondents owned two-wheeler.

49

2. WHICH COMPANY TWO-WHEELER DO YOU OWN?

TABLE 7

COMPANY NO OF RESPONDENTS PERCENTAGE

HERO 72 36%

HONDA 50 25%

BAJAJ 62 31%

OTHERS 16 8%

GRAPH 7

TWO-WHEELER COMPANY
OTHERS, 16, 8% HERO, 72, 36% HERO HONDA BAJAJ OTHERS

BAJAJ, 62, 31%

HONDA, 50, 25%

INTERPRETATION: The two- wheeler owned by the respondents reveals that 36% are using Hero, 31% are using Bajaj, 25% using Honda, 8% respondents are using other company two-wheelers like TVS etc... The analysis reveals that majority are Hero followed by Bajaj.

50

3. YOU OWNED TWO-WHEELER BY?

TABLE 8

MEANS OF OWNING NO OF RESPONDENTS PERCENTAGE

DIRECT PAYMENT 44 22%

FINANCE 156 78%

GRAPH 8

MEANS OF OWNING
DIRECT PAYMENT, 44, 22%

DIRECT PAYMENT FINANCE FINANCE, 156, 78%

INTERPRETATION: Here the number of respondents who said that they owned a two-wheeler by direct payment was 44 members that mean 22% and respondents owned by finance were 156 members that mean 78%. This shows that large number of respondents owned two-wheelers by finance.

51

4. IF YOU AUDILE A LOAN WHICH BANK YOU OPT?

TABLE 9

MEANS OF OWING NO OF RESPONDENTS PERCENTAGE

HDFC 30 15%

SBI 84 42%

ICICI 30 15%

OTHERS 56 28%

GRAPH 9

AUDILE OF BANK
HDFC, 30, 15% OTHERS, 56, 28% HDFC SBI ICICI ICICI, 30, 15% SBI, 84, 42% OTHERS

INTERPRETATION: The respondents feels if they want to take loan 15% of them choose HDFC and ICICI, 28% chooses different banks and 42% of them choose SBI bank for audile loan. The analysis reveals that majority are audile loan from SBI Bank.

52

5. WHAT PERCENTAGE DO YOU WANT TAKEN AS A LOAN?

TABLE 10

PERCENTAGE NO OF RESPONDENTS PERCENTAGE

50%-60% 90 45%

61%-70% 70 35%

71%-80% 30 15%

81%-90% 10 5%

GRAPH - 10

PERCENTAGE OF LOAN
71%-80%, 30, 15% 81%-90%, 10, 5% 50%-60% 50%-60%, 90, 61%-70% 45% 71%-80% 61%-70%, 70, 35% 81%-90%

INTERPRETATION: The respondents who want to take loan of percentage are as follows: 45%respondents want to take 50-60 percent as a loan. 35%respondents want to take 61-70 percent as a loan. 15%respondents want to take 71-80 percent as a loan. 5%respondents want to take 81-90 percent as a loan.

Majority of the respondents want to take loan up to 50%-60%.

53

6. WHAT IS THE IMPORTANT FACTOR TO YOU?

TABLE- 11

FACTORS NO OF RESPONDENTS PERCENTAGE

DISCOUNT 70 35%

EASY INSTALLEMENTS 64 32%

0% INTEREST SCHEME 50 25%

OTHERS 16 8%

GRAPH 11

OTHERS 16 8%

FACTORS

DISCOUNT 70 35%

DISCOUNT EASY INSTALLEMENTS 0% INTEREST SCHEME

0% INTEREST SCHEME 50 25%

OTHERS EASY INSTALLEMENT 64 32%

INTERPRETATION: Here 35% of the respondents prefer discounts, where as 32% prefer 0%interest scheme, 25% respondents prefer easy installment and 8% of the customers prefer other offers provided. Majority prefer discounts because the price gets reduced and also the consumer perception towards the sacrifice that bye is making to buy the product changes which ultimately laeds to customer satisfaction.

54

7. DOES THE DISCOUNT PLAY MAJOR ROLE? TABLE- 12

FACTOR NO OF RESPONDENTS PERCENTAGE

YES 150 75%

NO 50 25%

GRAPH 12

DISCOUNT ROLE
NO, 50, 25%

YES YES, 150, 75% NO

INTERPRETATION: Here the number of respondents who said that the discounts play major role were 75% and respondent who said that the discounts will not play major role were 25%. This shows that large number of respondents fells discounts plays major role.

55

8. OTHER THAN THE DISCOUNT WHAT IMPRESSES YOU?

TABLE-13
FACTORS NO OF RESPONDENTS PERCENTAGE SERVICES OF THE EASY AND LOW BRAND PRICE COMPANY MAINTENTANCE 62 31% 40 20% 80 40% OTHERS 18 9%

GRAPH 13

FACTORS
OTHERS, 18, 9% BRAND PRICE BRAND PRICE, 62, 31% SERVICES OF THE COMPANY EASY AND LOW MAINTENTANCE OTHERS EASY AND LOW MAINTENTANCE, 80, 40% SERVICES OF THE COMPANY, 40, 20%

INTERPRETATION: The data shows that 31% of people brand price, 20% said they prefer services of the company, 40% prefer easy and low maintenance and 9% prefers other things. Majority prefers easy and low maintenance because the charges mileage, servicing etc, plays a major role.

56

9. DURATION OF THE LOAN WHICH YOU WANT TO ADOPT?

TABLE-14
FACTORS NO OF RESPONDENTS PERCENTAGE 12MONTHS 22 11% 24MONTHS 98 49% 36MONTHS 62 31% NO LOAN 18 9%

GRAPH 14

TIME DURATION
NO LOAN, 18, 9% 12MONTHS, 22, 11% 36MONTHS, 62, 31% 12MONTHS 24MONTHS 36MONTHS NO LOAN 24MONTHS, 98, 49%

INTERPRETATION: The data shows that 11% of respondents want to adopt 12 months duration loan, 49% want to adopt 24 months duration of loan, 31%want to adopt 36 months duration of loan, and remaining 9% want to make direct payment. Most of the respondents thought repayment of loan is better if it is 24 months duration.

57

10. ARE YOU SATISFIED WITH THE DISCOUNT OFFER?

TABLE-15
FACTOR NO OF RESPONDENTS PERCENTAGE YES 134 67% NO 66 33%

GRAPH 15

SATISFASCTION
NO, 66, 33%

YES NO YES, 134, 67%

INTERPRETATION: There are 67% of the 134 people are satisfied with the discount of this brand, and other 33% of the 66 people are not satisfied this brand. So, majority are satisfied with this brand discounts.

58

CHAPTER: V

SUMMARY FINDINGS SUGGESTIONS CONCLUSION

59

SUMMARY

Different segments and the new models that are going to be launched it gives the details of the brand Hero such as its features and facilities. By 2014 the Hero will going to reach a turnover of 112 Cores in India. The objectives are to measure the impact of discount on sales, to offers which are introduced by Hero in cities like Vizianagaram. Hero has its own brand image, with and dept of distribution through their exclusive showroom in many parts in Andhra Pradesh. The company is getting good sales and turnover. The sales are gradually is increasing its turnover. Promotional strategy is essential Marketing tool. A proactive promotional strategy to face the competition and reach the customers. Firms promotional strategies depend on situation and have to hang according to the market situation. The objectives of promotional strategy are to promote sales, profits and create awareness. Discounts and offers play major role in industry. They are not only the motivators in the present market but customers also motivated of other factors like low maintenance, performance of vehicle and brand image. A brand is a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one sellers or group of sellers and to differentiate them from those of competitors. Most of the marketers say branding is art and cornerstone of marketing.

60

FINDINGS
Customers in the age group of 35 years to 44 years are more in number who having a connection. Majority of the customers are employees. In the respondents the more who using Two-wheelers having income of 20,000-30,000. There are 81% of the respondents are having Two-wheelers. Most of the customers were post graduates who owned Two-wheelers. Majority of the respondents are using HERO Two-wheelers. Most of the customers want to buy Two-wheelers through finance. The analysis reveals that majority are audile loan from SBI bank. The customers influenced to buy this product mainly for network and thinks about other usages next. Most of the customers want to take loan the percentage of 50-60. The customer main preference is discount. Discount plays a major role.

61

SUGGESTIONS

The company should think of more schemes and discounts in the city of Vizianagaram are more fascinated discounts and offers. The company has to concentrate on the customers who fall in 20-40 age groups to drastic in corporate world. The company is suggested to involve celebrities in promotional campaigns with other brands. As most of the buyers are purchasing through finance company should allow more banks to access in the market. The company should concentrate on educating the customer about various discounts and schemes through different promotional strategies. According to the analysis made, the suggestions are that the dealer ship should frame a package according to the customers needs and wants. Customers should also focus on aspects like brand name, low maintenance and after sales services etc, rather than discounts.

62

CONCLUSION
Promotional strategy is essential Marketing tool objectives of promotional strategy are to promote sales, profits and create awareness. Discounts and offers play major role in industry most of the marketers say branding is art and cornerstone of marketing. From this survey we have discovered that the two-wheeler companies HERO are good but there are many companies which are not providing particular facilities to retain their customer. Two-wheeler Markets are very big and it is in its growing stage. People are enjoying its and some of them use it just as status symbol only. Whereas some of them are really needs it for their work. It was really very interesting work to talking with different people daily of different level and different categories. We tried our best to find all the datas and facts. It was difficult to read the psychology of the people and the respondents who use two-wheeler. Sri Varalakshmi Hero Motors Pvt. Ltd is friendlier and very co-operative to help us in filling this form to perform this work.

63

ANNEXURE

64

QUESTIONAIRE
Customer profile A. Age (in years) 18-24 25-34 35-44 45-54 > 64

B. Education Graduate Post Graduate Illiterate

C. Occupation Professional Business Govt. Service Employee Any other

D. Monthly Income (in Rs.) < 10000 40000 50000 10000 20000 < 50000 20000 30000 30000 40000

E. Gender Male Female

1. Do you have any Two-wheeler? Yes No

2. Which company two-wheeler do you own? Hero Honda Bajaj others

65

3. You owned two-wheeler by? Direct Payment Finance

4. If you audile a loan which bank you opt? HDFC SBI ICICI Others

5. What percentage do you want taken as a loan? 50%-60% 61%-70% 71%-80% 81%-90%

6. What is the important factor to you? Discount Easy Installments 0% Interest scheme others

7. Does the discount play major role? Yes No

8. Other than the discount what impresses you? Brand and Price Easy and low maintenance Services of the company others

9. Duration of the loan which you want to adopt? 12 Months 24 Months 36 Months No Loan

10. Are you satisfied with the discount offer? Yes Name of Respondent: No Contact no:

66

BIBILIOGRAPHY

REFERENCE BOOK
Kothari, C.R., Research Methodology Methods and Techniques. New Age International Publishers. New Delhi: 2007 Philip Kotler & Kevin Lane Keller, Marketing Management. Prentice Hall of India. New Delhi: 2007

WEB SITES
www.google.com www.hero.com www.heroindia.com

JOURNALS
The Business World. Economic Times. The Hindu.

67