Ecomomy analysis india

The beginning of 2010 has not been particularly impressive for the Indian markets. The NIFTY touched a 2010 high of 5281.8 on January 6, 2010. Since then, the markets have corrected 8.6% and is currently trading at 4826.8 on the NIFTY.

The big question in the mind of many investors probably is - Will the markets correct more or positions for long term can be taken at these levels?

This article looks into the probable direction of the Indian markets in the next 1-2 months. It is impossible to predict any levels for the indices. Hence, that is not something I would attempt to do. I will primairly try to figure out the probable trend for the markets based on certain factors and events.

I would present my conclusion first and then the rationale for the conclusion.

In my opinion, the Indian markets have further downside if we look at a 1-2 month time horizon. Therefore, if I were looking at some long term investment, I will personally wait for some more time before taking any fresh exposure to the markets.

The reasons why I feel that markets might correct further are discussed below.

Valuations still look expensive

The Indian markets are still trading at a PE of close to 21. This is higher then the average PE the Indian markets have traded in the last 10 years. Also, the Indian markets have gone up over 100% from its March 2009 lows. After such a steep rise, a correction of even 20-25% can't be ruled out. This would be healthy for the markets in terms of attractive more money as valuations again start looking fair.

China Credit Tightening

The Central Bank in China has been making efforts to control the credit growth as there is a high probability of asset bubbles and run away inflation in China. Infact, one can say that the Chinese property market is already in a bubble stage.

Therefore, there is a high probability of aggressive policy action to control credit growth and this can slow down China's growth significantly. Any such event will trigger a sharp sell off by the FII's in the emerging markets. Hence, the Indian economy might do well and the stock markets tank or correct significantly.

No high hopes with Budget 2009-10

It is very clear that the main focus of the Government during the current years budget will be to take measures to reduce the deficits. Generally, the first and the last budget of any Government is the one where deficits concerns take a back seat.

Therefore, it would not be a budget that would go down very will with the corporates and the investors. Even if we look at the historic trend, the markets have corrected significantly after the Budget. In my opinion, it will be no different this time.

Plenty of problems in the Western World

The developed world has averted a financial disaster but are surely not out of the woods. The fears of soverign debt defalt is a very valid one. The fear os the U.S economy slowing down again is also valid and highly probable.

Therefore, there are not many positive cues which one can expect from the developed markets.

Inflation Concern

There is no doubt that the Indian economy is coming back to a robust growth trajectory. At the same time, inflation is also becoming a greater concern. The food inflation has shown no signs of easing and the WPI inflation is also going up at a robust pace.

It would not be surprising to see further action by the RBI relatively soon. This might act as a negative trigger for the markets.

Sectors to Avoid

Industrial Commodities - will be negatively impacted if there is a sharp slowdown in China Real Estate - Valuations still look expensive and interest rate hardening can negatively impact growth Crude Oil Exploration - The China slowdown factor might impact exploration Companies as crude corrects

Automobile Industry
The Indian automobile industry is the tenth largest in the world with an annual production of approximately 2 million units. Indian auto industry, promises to become the major automotive

industry in the upcoming years and the industry experts are hopeful that it will touch 10 million units mark. Indian automobile industry is involved in design, development, manufacture, marketing, and sale of motor vehicles. There are a number of global automotive giants that are upbeat about the expansion plans and collaboration with domestic companies to produce automobiles in India. The major car manufacturers in India are Maruti Udyog, Hyundai Motors India Ltd., General Motors India Pvt. Ltd., Honda Siel Cars India Ltd., Toyota Kirloskar Motor Ltd., Hindustan Motors etc. The two-wheeler manufacturers in India are Honda Motorcycle & Scooter India (Pvt.) Ltd., TVS, Hero Honda, Yamaha, Bajaj, etc. The heavy motors including buses, trucks, auto rickshaws and multi-utility vehicles are manufactured by Tata-Telco, Eicher Motors, Bajaj, Mahindra and Mahindra, etc. Quick Facts:

First Indian to own a car in India was Jamshedji Tata. First woman to drive a car in India was Mrs. Suzanne RD Tata. The passenger car and motorcycle segment in the Indian auto industry is growing by 8-9 percent. Commercial vehicle will grow by 5.2 per cent. The first automobile in India was rolled in 1897 in Bombay. India is a potential emerging auto market. Motorcycles contribute 80% of the two-wheeler industry. Unlike the USA, the Indian passenger vehicle market is dominated by cars (79%). India is the largest two-wheeler manufacturer in the world. India's motorcycle segment will grow by 8-9 percent in the coming years. 11. India is the fifth largest commercial vehicle manufacturer in the world. 12. India has the number one global motorcycle manufacturer. 13. In Asia, India is the fourth largest car market.

Used car Market

The new chapter in the automobile industry is that of used cars. The massive demand of used cars indicates that cars are becoming increasingly popular. Those who can't afford the luxury cars and their high prices are opting for used cars. In today's time, customers are conscious and diligently investing on car dealership. Car buyers are investing heavily a lot of time for both to sell a car and buy car. There's also a number of car websites that have offering detailed information on new car prices, used cars, car reviews, Chevrolet cars, jaguar cars and luxury cars.

Market Share
At present major Indian, European, Korean, Japanese automobile companies are holding significant market shares. In commercial vehicle, Tata Motors dominates over 60% of the Indian

commercial vehicle market. Tata Motors is the largest medium and heavy commercial vehicle manufacturer. Among the two-wheeler segment, including scooters and mopeds- motorcycles have- major share in the market. Hero Honda contributes 50% motorcycles to the market in which Honda holds 46% share in scooter and TVS makes 82% of the mopeds in the country. In the three wheeler industry in India, Piaggio holds 40% of the market share. Bajaj is the leader by making 68% of the three-wheelers. Car manufacturers in India dominate the passenger vehicle market by 79%. Maruti Suzuki is the largest car producer in India and has 52% share in passenger cars and is a complete monopoly in multi purpose vehicles. In utility vehicles Mahindra holds 42% share. Hyundai and Tata Motors is the second and third car producer in India.

Toyota India
Toyotas brand image as the number one in reliability may have been eroded big time with the recalls regarding the sudden acceleration reports, world-wide. However in India, the case has been so very different. People still perceive quality with Toyota. This has boosted the manufacturers ego and they are planning to launch a slew of automobiles in India within the next 2 years. Of prime importance is the fact, that they would officially bring in the full Lexus as well as their Daihatsu sourced small cars.

Of prime importance would be the small cars for which the demand is very high in India. They would be built on an all new platform for India, however these platforms as well as cars are been sold elsewhere in the middle east as well as North America under different names. Toyota is currently the worlds largest manufacturer however in India, the scene is far from true. Toyota sell only premium cars and hence to gain a good market share of the booming Indian market, Toyota have taken a plunge into the small car market. From the look of the cars at the Delhi Auto Expo 2010, it was evident that Toyota have already won half the battle.

Looks

Both the cars bring a welcome refreshment to their segments as far as looks are concerned. The front end looks imposing yet has the subtle Toyota corporate image. This is evident from the two tiered chrome grill. The headlamps are of the pear shape and feature multi reflector lights. They also incorporate the same headlamp assembly as the new Corolla Altis, which means they would have legal HID kits. The air dams are a big deal by Indian cars standards. As opposed to the segment norm of having fog lamps fitted into the air dams, the Etios differs by having them on the front bumper. There is also a prominent front spoiler which gives it the look of a tuned Japanese car. Unfortunately the sedan doesnt feature the spoiler but has the same looks of the

hatchback viewed from the front. The bonnet is also a long affair in both the sedan and hatchback in India. The sedan features side indicators embedded into them whereas the hatch back makes do without them. The wheels were the 15 inch types on both the body types. A flowing crease runs from wheel to wheel. The roof of the hatchback blends smoothly into the Hyundai I10-like rear end. The tail lamps are of the elongated types. The less said the better about the rear end of the sedan though. It looks like the cross of the Indigo Manza and that of the Renault Logan. The tail lamp structure for both the sedan and hatchback are different. Both the cars have a thick strip of chrome at the rear. A rear roof-line spoiler on the hatch back makes it one of the best looking rear for an Indian car. The tail pipes are conspicuous by their absence in both though. The alloys on both the cars are different. The one on the Toyota India Etios sedan were of the subtle 6 spoke alloys, first seen on the first generation Corolla whereas the ones on the 5 door variant looked jazzy. Overall, both the hatchback and sedan, from a distance, look like the Volkswagen Polo and Vento respectively.
Interiors

The interiors of both are as different chalk and cheese. For the hatchback, the steering wheel is a two tone affair, one sporting red on the sides and ivory on the straights. It also features audio controls on one side. The upper side of the dash is black and the lower end is ivory. The music system looks space age and probably has navigation controls as well. The instrument cluster is centrally placed and has a Yamaha FZ-like instrument cluster. Though not totally digital, it has that look for sure. The ac vents are of the circular type and one which is adept at directing air flow towards rear passengers as well.

The Toyota India Etios sedan has a more conservative cabin. It looks sort of built to a price thing and the hatchbacks high quality interiors are totally absent in the sedan. The sedan like the outside, also on the inside looks like the Mahindra-Renault Logan, bare basic. It is even devoid of steering audio controls. Whichever body style you choose, the Toyota wouldnt disappoint you with its interior space. The sedan has a humongous boot pegged at 450 liters and the hatchback at an impressive 370 liters. The flat floor at the rear helps in getting a 3rd passenger stuffed easier.

Handling and ride quality

Though we couldnt take the Toyota India Etios sedan or hatchback for a spin, we can judge by the GOA chassis that both would be safe handlers as also give a good ride. The sedan with its wider foot print would shine more in the ride department than the handling part. Toyota Indias cars arent known for their handling but for their ride quality. As of now, both body types would be offered with a 5 speed manual with an auto tranny on the periphery later. The 75/65 R14 and 185/60 R15 tyre sizes are at par with the competition and give the car a planted feel.
Engine,Performance and fuel efficiency

The engine for the hatchback is a segment comparable 1.2 liters but one producing 80bhp. It is a 16 valve petrol without the VVT-I technology. Toyota has assured us that the Etios wouldnt feel out of place without this technology as they have made internal revisions to the engine components to compensate it. The sedan boasts of a 1.5 liter petrol which churns out 102 bhp. Couple this with the 800kg for the hatchback and 920 for the sedan, it should spell some potent performance from both the engines. The braking for both, would be discs upfront and drums at the rear. However for the higher variants, you can specify discs at the rear as well. Safety features would be at segment par, with two airbags, ABS and traction control. Toyota may offer parking aids as well on the sedan. Fuel efficiency for the hatchback should be around 13-14 kmpl in city and 18-20 kmpl on the highway. For the sedan, it would be 11-13 in city and 16-18 on the highway. This would be at par with competition. Toyota could do well to shoe-horn the 1.4 liter diesel from its Corolla sedan into both the Etios hatchback and sedan.
Verdict

Toyota Kirloskar India has been long synonymous in India for high quality, highly engineered and good resale value cars. Their car designs may not be the best in the world but they do give you a sense of solidity like none other. The Etios hatchback and sedans are bound to change the feeling of the staid designs, the hatchback noticeably so more than the sedan. Couple that with the expected at par with competition fuel efficiency and probably a killer pricing considering the use of local components to a high level, you cannot go wrong with this sedan-hatchback twins. Expect the hatchback to start from Rs.4,50000 to Rs.5,90000 for the top end version. The sedan should start from Rs.6,10000 to Rs.7,20000 for the higher variants.

Maruti Suzuki

Maruti Suzuki India Limited (Hindi: ) (NSE: MARUTI, BSE: 532500) a partial subsidiary of Suzuki Motor Corporation of Japan, is India's largest passenger car company, accounting for over 45% of the domestic car market. The company offers a complete range of cars from entry level Maruti 800 and Alto, to hatchback Ritz, A star, Swift, Wagon-R, Estillo and sedans DZire, SX4, in the 'C' segment Maruti Eeco and Sports Utility vehicle Grand Vitara.[4] It was the first company in India to mass-produce and sell more than a million cars. It is largely credited for having brought in an automobile revolution to India. It is the market leader in India, and on 17 September 2007, Maruti Udyog Limited was renamed as Maruti Suzuki India Limited. The company's headquarters are located in New Delhi.[1]

Profile

The old logo of Maruti Suzuki India Limited. Later the logo of Suzuki Motor Corp. was also added to it

'To Munsiyari on a Maruti 800', Uttarakhand Himalayas

Maruti Suzuki plant in Manesar

Maruti Suzuki is India and Nepal's number one leading automobile manufacturer and the market leader in the car segment, both in terms of volume of vehicles sold and revenue earned. Until recently, 18.28% of the company was owned by the Indian government, and 54.2% by Suzuki of Japan. The BJP-led government held an initial public offering of 25% of the company in June 2003. As of 10 May 2007, the government of India sold its complete share to Indian financial institutions and no longer has any stake in Maruti Udyog.[citation needed] Maruti Udyog Limited (MUL) was established in February 1981, though the actual production commenced in 1983 with the Maruti 800, based on the Suzuki Alto kei car which at the time was the only modern car available in India, its only competitors- the Hindustan Ambassador and Premier Padmini were both around 25 years out of date at that point. Through 2004, Maruti Suzuki has produced over 5 Million vehicles. Maruti Suzukis are sold in India and various several other countries, depending upon export orders. Models similar to Maruti Suzukis (but not manufactured by Maruti Udyog) are sold by Suzuki Motor Corporation and manufactured in Pakistan and other South Asian countries.[citation needed] The company exports more than 50,000 cars annually and has an extremely large domestic market in India selling over 730,000 cars annually. Maruti 800, till 2004, was the India's largest selling compact car ever since it was launched in 1983. More than a million units of this car have been sold worldwide so far. Currently, Maruti Suzuki Alto tops the sales charts.[citation needed] Due to the large number of Maruti 800s sold in the Indian market, the term "Maruti" is commonly used to refer to this compact car model. Its manufacturing facilities are located at two facilities Gurgaon and Manesar south of Delhi. Maruti Suzukis Gurgaon facility has an installed capacity of 350,000 units per annum. The Manesar facilities, launched in February 2007 comprise a vehicle assembly plant with a capacity of 100,000 units per year and a Diesel Engine plant with an annual capacity of 100,000 engines and transmissions. Manesar and Gurgaon facilities have a combined capability to produce over 700,000 units annually. More than half the cars sold in India are Maruti Suzuki cars. The company is a subsidiary of Suzuki Motor Corporation, Japan, which owns 54.2 per cent of Maruti Suzuki. The rest is owned by public and financial institutions. It is listed on the Bombay Stock Exchange and National Stock Exchange in India.[citation needed]

During 2007-08, Maruti Suzuki sold 764,842 cars, of which 53,024 were exported. In all, over six million Maruti Suzuki cars are on Indian roads since the first car was rolled out on 14 December 1983. Maruti Suzuki offers 14 models, Maruti 800, Alto, WagonR, Estilo, A-star, Ritz, Swift, Swift DZire, SX4, Omni, Eeco, Gypsy, Grand Vitara, Kizashi. Swift, Swift DZire, A-star and SX4 are manufactured in Manesar, Grand Vitara and Kizashi are imported from Japan as completely built units(CBU), remaining all models are manufactured in Maruti Suzuki's Gurgaon Plant.[citation needed] Suzuki Motor Corporation, the parent company, is a global leader in mini and compact cars for three decades. Suzukis technical superiority lies in its ability to pack power and performance into a compact, lightweight engine that is clean and fuel efficient. Nearly 75,000 people are employed directly by Maruti Suzuki and its partners. It has been rated first in customer satisfaction among all car makers in India from 1999 to 2009 by J D Power Asia Pacific.[5]
Further information: Timeline of Maruti Suzuki

[edit] Partner for the joint venture

Sanjay Gandhi owned the Maruti Technical Services Limited, which ran into trouble and was liquidated. After the death of Sanjay Gandhi, the Indira Gandhi government assigned a delegation of Indian technocrats to hunt for a collaborator for the project. Initial rounds of discussion were held with the giants of the automobile industry in Japan including Toyota, Nissan and Honda. Suzuki Motor Corporation was at that time a small player in the four wheeler automobile sector and had major share in the two wheeler segment. Suzuki's bid was considered negligible.[citation needed] While the major companies were personally represented in the initial rounds of discussion, Osamu Suzuki, Chairman and CEO of the company ensured that he was present in all the rounds of discussion. Osamu in an article writes that it subtly massaged their (Indian delegation's) egos and also convinced them about the sincerity of Suzuki's bid. Suzuki in return received a lot of help from the government in such matters as import clearances for manufacturing equipment (against the wishes of the Indian machine tool industry then and its own socialistic ideology), land purchase at government prices for setting up the factory Gurgaon and reduced or removal of excise tariffs. This ensured that Suzuki conscientiously nursed Maruti Suzuki through its infancy to become one of its flagship ventures.[6]

[edit] Joint venture related issues

Maruti Suzuki's A-Star vehicle during its unveiling in Pragati Maidan, Delhi. A-Star, Suzuki's fifth global car model, was designed and is made only in India.[7] Maruti Suzuki is also Suzuki's leading research and development arm outside Japan

Relationship between the Government of India, under the United Front (India) coalition and Suzuki Motor Corporation over the joint venture was a point of heated debate in the Indian media till Suzuki Motor Corporation gained the controlling stake. This highly profitable joint venture that had a near monopolistic trade in the Indian automobile market and the nature of the partnership built up till then was the underlying reason for most issues. The success of the joint venture led Suzuki to increase its equity from 26% to 40% in 1987, and further to 50% in 1992. In 1982 both the venture partners had entered into an agreement to nominate their candidate for the post of Managing Director and every Managing Director will have a tenure of five years[8] R.C. Bhargava was the initial managing director of the company since the inception of the joint venture. Till today he is regarded as instrumental for the success of Maruti Suzuki. Joining in 1982 he held several key positions in the company before heading the company as Managing Director. Currently he is on the Board of Directors.[9] After completing his five year tenure, Mr. Bhargava later assumed the office of Part-Time Chairman. The Government nominated Mr. S.S.L.N. Bhaskarudu as the Managing Director on 27 August 1997. Mr. Bhaskarudu had joined Maruti Suzuki in 1983 after spending 21 years in the Public sector undertaking Bharat Heavy Electricals Limited as General Manager. In 1987 he was promoted as Chief General Manager. In 1988 he was named Director, Productions and Projects. The next year (1989) he was named Director of Materials[clarification needed] and in 1993 he became Joint Managing Director.[citation needed] Suzuki Motor Corporation didn't attend the Annual General Meeting of the Board with the reason of it being called on a short notice.[10] Later Suzuki Motor Corporation went on record to state that Bhaskarudu was "incompetent" and wanted someone else. However, the Ministry of Industries, Government of India refuted the charges. Media stated from the Maruti Suzuki sources that Bhaskarudu was interested to indigenise most of components for the models including gear boxes especially for Maruti 800. Suzuki also felt that Bhaskarudu was a proxy for the Government and would not let it increase its stake in the venture.[11] If Maruti Suzuki would have been able to indigenise gear boxes then Maruti Suzuki would have been able to manufacture all the models without the technical assistance from Suzuki. Till today the issue of localization of gear boxes is highlighted in the press.[12] The relations strained when Suzuki Motor Corporation moved to Delhi High Court to bring a stay order against Bhaskarudu's appointment. The issue was resolved in an out-of-court settlement and both the parties agreed that R S S L N Bhaskarudu would serve up to 31 December 1999, and from 1 January 2000, Jagdish Khattar, Executive Director of Maruti Udyog Limited would assume charges as the Managing Director.[13] Many politicians stated in parliament that the Suzuki Motor Corporation is unwilling to localize manufacturing and reduce imports. As of 2011 Gear boxes are still imported from Japan and are assembled at the Gurgaon facility.[citation needed]

[edit] Industrial relations

For most of its history, Maruti Udyog Limited had relatively few problems with its labour force. Its emphasis of a Japanese work culture and the modern manufacturing process, first instituted in Japan in the 1970s, was accepted by the workforce of the company without any difficulty. But with the change in management in 1997, when it became predominantly government controlled for a while, and the conflict between the United Front Government and Suzuki may have been the cause of unrest among employees. A major row broke out in September 2000 when employees of Maruti Udyog Ltd (MUL) went on an indefinite strike, demanding among other things, revision of the incentive scheme offered and implementation of a pension scheme.[citation
needed]

Employees struck work for six hours in October 2000, irked over the suspension of nine employees, going on a six-hour tools-down strike at its Gurgaon plant, demanding revision of the incentive-linked pay and threatened to fast to death if the suspended employees were not reinstated. About this time, the NDA government, following a disinvestments policy, proposed to sell part of its stake in Maruti Suzuki in a public offering. The Staff union opposed this sell-off plan on the grounds that the company will lose a major business advantage of being subsidised by the Government.[citation needed] The standoff with the management continued to December with a proposal by the management to end the two-month long agitation rejected with a demand for reinstatement of 92 dismissed workers, with four MUL employees going on a fast-unto-death. In December the company's shareholders met in New Delhi in an AGM that lasted 30 minutes. At the same time around 1500 plant workers from the MUL's Gurgaon facility were agitating outside the company's corporate office demanding commencement of production linked incentives, a better pension scheme and other benefits. The management has refused to pass on the benefits citing increased competition and lower margins.
Manufacturing facilities

Maruti Suzuki has two state-of-the-art manufacturing facilities in India.[15] Both manufacturing facilities have a combined production capacity of 1,250,000 vehicles annually.
[edit] Gurgaon Manufacturing Facility

The Gurgaon Manufacturing Facility has three fully integrated manufacturing plants and is spread over 300 acres (1.2 km2). All three plants have an installed capacity of 350,000 vehicles annually but productivity improvements have enabled it to manufacture 700,000 vehicles annually. The Gurgaon facilities also manufacture 240,000 K-Series engines annually. The entire facility is equipped with more than 150 robots, out of which 71 have been developed in-house. The Gurgaon Facilities manufactures the 800, Alto, WagonR, Estilo, Omni, Gypsy and Eeco.

[edit] Manesar Manufacturing Facility

The Manesar Manufacturing Plant was inaugurated in February 2007 and is spread over 600 acres (2.4 km2). Initially it had a production capacity of 100,000 vehicles annually but this was increased to 300,000 vehicles annually in October 2008. The production capacity was further increased by 250,000 vehicles taking total production capacity to 550,000 vehicles annually. The Manesar Plant produces the A-star, Swift, Swift DZire and SX4.
[edit] Sales and service network

As of 31 March 2011 Maruti Suzuki has 933 dealerships across 666 towns and cities in all states and union territories of India. It has 2,946 service stations (inclusive of dealer workshops and Maruti Authorised Service Stations) in 1,395 towns and cities throughout India.[16] It has 30 Express Service Stations on 30 National Highways across 1,314 cities in India. Service is a major revenue generator of the company. Most of the service stations are managed on franchise basis, where Maruti Suzuki trains the local staff. Other automobile companies have not been able to match this benchmark set by Maruti Suzuki. The Express Service stations help many stranded vehicles on the highways by sending across their repair man to the vehicle.[17]
[edit] Maruti Insurance

Launched in 2002 Maruti Suzuki provides vehicle insurance to its customers with the help of the National Insurance Company, Bajaj Allianz, New India Assurance and Royal Sundaram. The service was set up the company with the inception of two subsidiaries Maruti Insurance Distributors Services Pvt. Ltd and Maruti Insurance Brokers Pvt. Limited[18] This service started as a benefit or value addition to customers and was able to ramp up easily. By December 2005 they were able to sell more than two million insurance policies since its inception.[19]
[edit] Maruti Finance

To promote its bottom line growth, Maruti Suzuki launched Maruti Finance in January 2002. Prior to the start of this service Maruti Suzuki had started two joint ventures Citicorp Maruti and Maruti Countrywide with Citi Group and GE Countrywide respectively to assist its client in securing loan.[20] Maruti Suzuki tied up with ABN Amro Bank, HDFC Bank, ICICI Limited, Kotak Mahindra, Standard Chartered Bank, and Sundaram to start this venture including its strategic partners in car finance. Again the company entered into a strategic partnership with SBI in March 2003[21] Since March 2003, Maruti has sold over 12,000 vehicles through SBI-Maruti Finance. SBI-Maruti Finance is currently available in 166 cities across India.[22] "Maruti Finance marks the coming together of the biggest players in the car finance business. They are the benchmarks in quality and efficiency. Combined with Maruti volumes and networked dealerships, this will enable Maruti Finance to offer superior service and competitive rates in the marketplace".

 Jagdish Khattar, Managing director of Maruti Udyog Limited in a press conference announcing the launch of Maruti Finance on 7 January 2002[20] Citicorp Maruti Finance Limited is a joint venture between Citicorp Finance India and Maruti Udyog Limited its primary business stated by the company is "hire-purchase financing of Maruti Suzuki vehicles". Citi Finance India Limited is a wholly owned subsidiary of Citibank Overseas Investment Corporation, Delaware, which in turn is a 100% wholly owned subsidiary of Citibank N.A. Citi Finance India Limited holds 74% of the stake and Maruti Suzuki holds the remaining 26%.[23] GE Capital, HDFC and Maruti Suzuki came together in 1995 to form Maruti Countrywide. Maruti claims that its finance program offers most competitive interest rates to its customers, which are lower by 0.25% to 0.5% from the market rates.[citation needed]
[edit] Maruti TrueValue

Main Article: Maruti True Value Maruti True service offered by Maruti Suzuki to its customers. It is a market place for used Maruti Suzuki Vehicles. One can buy, sell or exchange used Maruti Suzuki vehicles with the help of this service in India. As of 31 March 2010 there are 341 Maruti True Value outlets.[citation
needed]

[edit] N2N Fleet Management

N2N is the short form of End to End Fleet Management and provides lease and fleet management solution to corporates. Clients who have signed up of this service include Gas Authority of India Ltd, DuPont, Reckitt Benckiser, Sona Steering, Doordarshan, Singer India, National Stock Exchange and Transworld. This fleet management service include end-to-end solutions across the vehicle's life, which includes Leasing, Maintenance, Convenience services and Remarketing.[24]
[edit] Accessories

Many of the auto component companies other than Maruti Suzuki started to offer components and accessories that were compatible. This caused a serious threat and loss of revenue to Maruti Suzuki. Maruti Suzuki started a new initiative under the brand name Maruti Genuine Accessories to offer accessories like alloy wheels, body cover, carpets, door visors, fog lamps, stereo systems, seat covers and other car care products. These products are sold through dealer outlets and authorized service stations throughout India.[25]

[edit] Maruti Driving School

A Maruti Driving School in Chennai

As part of its corporate social responsibility Maruti Suzuki launched the Maruti Driving School in Delhi. Later the services were extended to other cities of India as well. These schools are modelled on international standards, where learners go through classroom and practical sessions. Many international practices like road behaviour and attitudes are also taught in these schools. Before driving actual vehicles participants are trained on simulators.[26] "We are very concerned about mounting deaths on Indian roads. These can be brought down if government, industry and the voluntary sector work together in an integrated manner. But we felt that Maruti should first do something in this regard and hence this initiative of Maruti Driving Schools."[citation needed] Jagdish Khattar, at the launch ceremony of Maruti Driving School, Bangalore

[edit] Issues and problems

On 24 February 2010, Maruti Suzuki India announced recalling of 100,000 A-Star hatchbacks to fix a fuel leakage problem. the company will replace the gaskets for all 100,000 A-Star cars.[27]

[edit] Exports
Maruti Exports Limited is the subsidiary of Maruti Suzuki with its major focus on exports and it does not operate in the domestic Indian market. The first commercial consignment of 480 cars were sent to Hungary. By sending a consignment of 571 cars to the same country Maruti Suzuki crossed the benchmark of 300,000 cars. Since its inception export was one of the aspects government was keen to encourage.[citation needed] Every political party expected Maruti Suzuki to earn foreign currency. Angola, Benin, Djibouti, Ethiopia, Europe, Kenya, Morocco, Nepal, Sri Lanka, Uganda, Chile, Guatemala, Costa Rica and El Salvador are some of the markets served by Maruti Exports.

Maruti Suzuki India Limited (MSIL), a subsidiary of Suzuki Motor Corporation (SMC), Japan, is the leader in passenger cars (PCs) and multipurpose vehicles (MPVs) in India, accounting for nearly 50 per cent of the total industry sales.

In 2009-10, the Company sold 1,018,365 vehicles. This comprised 870,790 vehicles in the domestic market and 147,575 vehicles in export markets. Cumulatively, it has produced and sold over 8 million cars.

The total income of the Company for 2009-10 stood at Rs.301,198 million. Maruti Suzuki has a strong balance sheet with reserves and surplus of Rs. 116.9 billion and debt equity ratio of 0.07 as on 31st March, 2010.

MSIL is a public limited company and is listed on Bombay Stock Exchange Limited and National Stock Exchange of India Limited. SMC is the majority shareholder with 54.21% equity stake in the Company

MSIL has two manufacturing facilities in Gurgaon and Manesar, Haryana, India, with a combined manufacturing capacity of over 1 million cars per annum. In terms of number of cars produced and sold worldwide, the Company is the largest subsidiary of SMC, Japan.

Gurgaon Plant

Spread over an area of 20,300 square meters with a capacity to produce over 500,000 engines per annum, the Gurgaon facility houses three fully integrated plants having a combined manufacturing capacity of over 700,000 vehicles per annum and a state-of-the-art K-series casting engine plant which employs global manufacturing best practices to ensure high quality standards.

Manesar Plant

Manesar is the Company's latest car assembly plant which was started in February, 2007. This plant has a capacity to produce over 300,000 units per annum with an additional capacity of 250,000 cars per annum, the operation of which began in 2009-10.

R & D Test Course

In 2009-10, 700 acres of land in Rohtak, Haryana have been procured by the company for setting up a world-class test course for R & D.

MSIL provides its customers with "one-stop-shop" experience such as Automobile Finance, Automobile Insurance, Maruti Genuine Parts and Accessories, Extended Warranty and Maruti Certified pre-owned cars. The Company had 341 pre-owned car outlets in 198 cities as on 31st March, 2010.

MSIL has the largest sales and service network amongst car manufacturers in India. It had 802 sales outlets in 555 cities and 2740 service workshops in 1335 cities as on 31st March, 2010. The service network of the Company includes Dealer Workshops, Maruti Authorised Service Stations (MASSs), Maruti Service Masters (MSM) and Maruti Service Zones (MSZ).

Export sales of the company touched 147,575 units, its highest ever. This is a 111% growth over the previous year's total of 70,023 units. Europe has accounted for over 75% of the sales. On a cumulative basis, the exports crossed 700,000 units. Currently the company is exporting to 98 countries in Europe, Asia, Latin America, Africa and Oceania.

In 2009-10, the Company sold 1,018,365 vehicles. This comprised 870,790 vehicles in the domestic market and 147,575 vehicles in export markets. Cumulatively, it has produced and sold over 8 million cars.

The total income of the Company for 2009-10 stood at Rs. 29,623 billion. Maruti Suzuki has a strong balance sheet with reserves and surplus of Rs. 116.9 billion and debt equity ratio of 0.07 as on 31st March, 2010.

MSIL is a public limited company and SMC is the majority shareholder with 54.21% equity stake in the Company.

honda
Honda Siel Cars India Ltd., (HSCI) was incorporated in December 1995 as a joint venture between Honda Motor Co. Ltd., Japan and Siel Limited, a Siddharth Shriram Group company, with a commitment to providing Hondas latest passenger car models and technologies, to the Indian customers. The total investment made by the company in India till date is Rs 1620 crores in Greater Noida plant and Rs 784 crores in Tapukara plant.

HSCIs first state-of-the-art manufacturing unit was set up at Greater Noida, U.P in 1997. The green-field project is spread across 150 acres of land (over 6,00,000 sq. m.). The annual capacity of this facility is 100,000 units. The companys second manufacturing facility is in Tapukara, Rajasthan. This facility is spread over 600 acres and will have an initial production capacity of 60,000 units per annum, with an investment of about Rs 1,000 crore. The first phase of this facility was inaugurated in September 2008.

Honda Siel Cars India Ltd. launched its much-awaited small car, the Honda Brio (pronounced as Br-ee-o and means energetic and cheerful in Italian), in the Indian market. The car, offered as the perfect package for a new era, embodies the best of Hondas technologies to deliver fun and agile driving, fuelefficiency, spaciousness & safety.

The companys product range includes Honda Brio, Honda Jazz, Honda City, Honda Civic and Honda Accord which are produced at the Greater Noida facility with an indigenization level of 80%, 77%, 76%, 74% and 28% respectively. The CR-V is imported from Japan as Completely Built Units. Hondas models are strongly associated with advanced design and technology, apart from its established qualities of durability, reliability and fuel-efficiency. Environment and Safety The Honda Group is globally recognized for its concern towards environment, safety and conservation of the society in which it operates. HSCI follows the same in India for achieving high standards in environmental safety in the various processes of car manufacturing. Honda Assure Reinforcing its position as a customer centric company, and to enhance ownership experience for Honda car customers, Honda Siel Cars India (HSCI) launched the 'Honda Assure', Hondas Insurance initiative.

Under the Honda Assure program all Honda customers get the benefit of a more transparent, hasslefree transaction and a quick turnaround time on their insurance claims. The entire transaction is routed through an on-line central server which enables HSCI to monitor the overall operations more effectively. Some of the direct benefits to the customers include Cashless Insurance across India, instant policy issuance, and improved turnaround time. Auto Terrace Honda's Exchange and Pre-Owned car division Auto Terrace has been in existence ever since the interception of HSCI in India. Present in all major Honda dealers across the country, Auto Terrace presents itself as the one-stop solution for catering to the needs of customers wanting to exchange their existing cars for a New Honda car. Exclusive Honda Care Program Honda Care Program is designed to bring an extra measure of security & comfort to being a Honda Owner. It includes additional warranty* of 2 years or 40,000 kms after the new vehicle warranty expires and 24 hrs Roadside Assistance support* for 4 years from the standard warranty start date. Sales Network Honda Siel Cars India has a strong sales and distribution network spread across the country. The network includes 127 facilities in 79 cities. HSCI dealerships are based on the 3S Facility (Sales, Service, Spares) format, offering complete range of services to its customers.

innovations
Honda has always believed in giving more excitement and more joy. Be it designing high performance sports cars that are a pleasure to behold and a joy to drive or creating the world's first humanoid robot to walk on two legs or countless other technologies that astonish and delight, Honda's spirit of exploration frequently invents the future.

Not surprisingly, millions of people worldwide often respond to Honda's spirit of innovation with a sense of delight and amazement. Honda's obsession for technology that continuously improves upon the performance and safety of all Honda vehicles is what sets it apart from other names in the car industry

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