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Hero Cycles expects market share growth to buck Covid impact
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Rituraj Baruah | 22 Jun, 2020
Leading bicycle maker Hero Cycles expects to increase its market share
in India to 45-50 per cent in the current financial year, despite the
slowdown caused by the coronavirus pandemic and the nationwide lockdown.
In
an interview with IANS, Pankaj M. Munjal, Chairman and Managing
Director, Hero Motors Company - of which Hero Cycles is a group company,
said that sales in India during the lockdown took a big hit but since
June 8, when the restrictions were by and large lifted, sales have
picked up.
"It's difficult to cope up 100 per cent lost sales of
Q1 (April-June) but we are hopeful that we will cover most of it
consolidating our market share to 45-50 per cent this year, up from 40
per cent March 2020," he said.
Munjal, however, noted that during
the lockdown period, unlike in India, demand increased for the
company's cycles in Europe. "In fact the demand was greater than the
supply, because no one expected a spike so sudden and tall," the CMD
told IANS.
On the company's plans in the electric cycles'
segment, he said that although the "electronic revolution" in India has
been slow, over the past one year there has been growth in the segment
and Hero Cycles expects to double the sales of its e-bikes this fiscal.
In just two years, the company has sold nearly 25,000 units, he said.
"E-cycles'
penetration today increased to 200 cities and expected to grow to 250
to 300 within this financial year as well. We are also hoping to double
the sales of our e-bikes in FY 2020."
The bicycle industry leader
also hoped that with the growing trend of environmental consciousness
amongst consumers, e-bikes or e-cycles will be looked as a more
eco-friendly, economical, non-motorised, personalised alternate mode of
travel.
As the lockdown gets lifted in phases, Munjal was of the
view that the cycle industry and the demand scenario in the market will
pick up faster compared to other sectors.
Further, given shared
mobility for transportation and gyms for fitness requirements are
unlikely to be preferred soon in the near future, people may opt for
cycles and e-cycles as an alternative both for fitness and commuting, he
said.
Asked about any delay in strategic decisions and planned
operations due to the lockdown, he admitted that there has been "a
slight delay". He said that the Hero Industrial Park that the company is
building in Ludhiana, where Hero Cycles is based, has fallen a bit
behind schedule.
"Hero Industrial Park that we are working on got
halted because of the Covid situation. Since the lockdown is nearly
lifted, we are trying to put things back on track and complete
construction by September and start production by Q4 FY 2020," he said.
Munjal added that there are no other plans which have seen a major course correction.
The
Hero Motors Company CMD told IANS that in the wake of the unanticipated
Covid crisis the company is trying to curtail any extra cost by making
the value chain more efficient.
He also said that Hero Cycles is
supporting its dealers with extended credit periods and other support
that they may require to continue operations and be back in business.
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