Honda May Make Small Cars To Take On Suzuki In India

Honda Motor Co., Japan's second- biggest automaker, is studying developing small cars with engines of less than 1.2 liters to woo buyers in India, where its market share is a tenth of rival Suzuki Motor Corp.

The small cars will also enjoy tax advantages in India, where they make up 75 percent of the market, Masahiro Takedagawa, chief executive of Honda Siel Cars India Ltd., said in an interview at its headquarters in Tokyo yesterday.

Honda is challenging Suzuki's dominance in India, where its unit Maruti Udyog Ltd. has a 50 percent market share compared with Honda's 5.5 percent. Nissan Motor Co. and Tata Motors Ltd. are also developing cheaper, smaller cars to entice the nation's 45 million motorcycle and scooter users.

``The key is which non-Indian automaker coming to India can cut costs furthest in order to compete with the local companies,'' said Koji Endo, a senior analyst at Credit Suisse Group in Tokyo.

India last year cut the federal excise tax on small cars to 16 percent from 24 percent. The change only affected petrol cars that are shorter in length than 4 meters (13.1 feet) and powered with engines smaller than 1.2 liters. India's car market, Asia's fourth-biggest, may triple to 3 million vehicles a year by 2015, according to government estimates.

Maruti Suzuki Autocross Solan 2007 Rally

Sunny Sidhu of Chandigarh won the Maruti Suzuki autocross solan 2007 rally for maruti made vehicles in upto 1100 cc vehicles and Suresh Rana from Manali won the first prize in Gypsy category.

Rehan khan from Delhi was adjudged the best rider in the two wheeler category championship.

40 top seeded drivers and riders from Jaipur, Delhi, Noida, Punjab, Haryana and Chandigarh participated in national level competition.

Specially designed start gate and 400 metres long track was laid down to test the skills of the drivers as well as the endurance of the machines.

The event was sponsored by Maruti Suzuki and supported by Indian Oil Corporation, Airtel, Pepsi and Indian Express.

Buy Maruti Udyog At Current Levels: SP Tulsian

Investment Advisor SP Tulsian is of the view that one can buy Maruti Udyog at current levels.

Tulsian told CNBC-TV18, "Maruti has reported sales of about 59,000 plus 59,440 for May 2007 and first two months sales figure has been more than 1,09,000 that means in April they effected sales of more than 50,000 while in May more than 59,000 and now there has been recent development that government is totally moved out of the company and about 55% stake is now held by Suzuki and close to 40% is held by mutual fund, insurance companies, banks and FIIs. So there is a very little floating stock of about 4-5% of Maruti into the market.

He further added, "The company’s performance by and large has been good about Rs 54 EPS for FY07. I think they are going to post a topline growth of at least 20% and maybe bottomline growth of also 20-24%. If you want to take a long-term call lets not get perturb by the acquisition cost which for this gentleman it is slightly lower than the present market price. But I am quite hopeful and have positive outlook on Maruti in the short to medium-term and even on the longer-term outlook. So my advice is that one could really go and buy at these levels but only thing he has to keep a longer-time horizon in his mind of at least 6-12 months. So my call on the company is clear buy at these levels."

Maruti May 2007 Sales Up 11.2% yoy

Maruti Udyog Ltd., India's largest passenger vehicle maker, said on Friday that its sales rose 11.2% last month, on the back of strong demand for Swift and Zen Estilo hatchbacks and the new SX4 sedan. Maruti Udyog Ltd, said it sold 59,400 vehicles in May, up 11.2 per cent from 53,396 units a year earlier. Maruti said it sold 55,952 units in the domestic market, also up 9.9 per cent from 50,904 units a year earlier.

Exports surged 38.4% to 3,448 units from 2,492 units in April 2006. Japan's Suzuki Motor Corp has a majority stake in Maruti.