Hero Splendor iSmart is one of the 11 models launched in Bangladesh
World’s largest two-wheeler manufacturer by volume, Hero MotoCorp Ltd (HMCL) today launched its operations in Bangladesh through a Joint Venture (JV) with the Nitol Niloy Group.
The JV was announced here today by Pawan Munjal, Managing Director & Chief Executive Officer, Hero MotoCorp Ltd, and Mr. Abdul Matlub Ahmad, Chairman, Nitol Niloy Group of Companies. Hero will hold majority stake of 55% in the this JV while the rest would be held by Nitol Niloy Group.
This is the company’s first overseas joint venture to set up a two-wheeler manufacturing plant outside of India and will be operational by the second quarter of FY 2015-16. However, Hero range of two-wheelers are already available in Bangladesh through the initial 50 retail outlets.The plant will have an annual capacity of 150,000 units.
“The commencement of our operations in Bangladesh is a significant milestone in our strategic global expansion plans. In addition to being our first overseas JV, this is also where our first manufacturing plant outside of India will come up,” said Munjal. “We are aiming to have around 20 per cent of market share here in the first year of our operation.”
There will be a total equity injection of US$ 12.6 million in a ratio of 55:45 over a period of two years. The new venture will have a CAPEX of US $ 23.2 million in the first year of its operation and a total investment of US $40 million over the next five years.
The range of Hero two-wheelers being sold in Bangladesh include models like the entry-level segment 100cc bikes- HF Dawn & HF Deluxe, Splendor+, Splendor Pro, Splendor iSmart, Passion Pro, the deluxe segment125cc Super Splendor and Glamour and the premium segment 150cc Xtreme and Hunk, and the 100-cc scooter Pleasure.
To meet the ambitious target 20% market share in the first year itself, Hero has launched an 5-year warranty on all models in Bangladesh.
“The aim is to join hands with Hero MotoCorp in order to provide technologically-advanced, innovative and fuel-efficient two-wheelers for customers in Bangladesh,” said Abdul Matlub Ahmad.
Hero MotoCorp said it will soon launch brand-building initiatives in this market with the Bengali version of the iconic Hero anthem “Hum Main Hai Hero”. There will also be brand-specific communications to establish Hero products in the country.
