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HMSI invests Rs. 600 crore to increase capacity at Karnataka plant to 18 lakh

Honda Motorcycle & Scooter India (HMSI) is planning to increase capacity of its Karnataka plant by six lakh units to take the total to 18 lakh with an investment of Rs. 600 crore in the next two years.

"By the end of this financial year, our capacity, including the new plant, will be 5.8 million. In the next two years, we are planning to add one more line (with 6 lakh units per annum capacity) to our Karnataka facility. The investment would be Rs 6 billion (Rs 600 crore)," Keita Maramastu, President and CEO of HMSI said.

The two-wheeler maker aims to enhance its market share to 30 per cent in the current fiscal on the back of additional capacity creation from the fourth plant in Vithalapur in Gujarat, he said.

"Our current market share is 27 per cent. We expect 3 per cent increase during the current year. Again, it depends on market conditions also," Maramastu added.

Honda is optimistic of looking for a good chance for sales growth this year. With the recent launch of its Gujarat facility, the company aims to increase sales by 20 per cent more than last year. "Last year, we sold 4.44 million units (including exports). We expect over five million this year," he said.

HMSI currently has four plants - Manesar (Haryana), Tapukara (Rajasthan), Bengaluru and Vithalapur with a combined capacity of 5.8 lakh units per annum.

Honda's plant at Narsapura industrial area near Bengaluru is currently equipped to manufacture 1.2 million units. With the expansion plan, the overall production capacity in India would go up to 6.4 million, he said, adding, "the scooter market in India is growing at 25-30 per cent."

Honda currently exports about two lakh vehicles to some 20 countries, including neighbouring Nepal, Sri Lanka and Bangladesh.