Thursday 7 June 2012

DSK Plans to Setup a Manufacturing Plant for Hyosung Bikes



DSK Head, Shirish Kulkarni answering media questions
After an official confirmation about DSK Group taking over Garware Motor’s share in the venture with Hyosung Korea there was a planned Question and Answers session which revealed a lot of interesting bits about DSK and the way they plan to go forward. Read on for a quick round of important points from the session.
Question & Answers Round:
  1. DSK did not disclose the amount at which they bought Garware’s stake.
  2. On a question that whether Garware Motors was a loss making unit, DSK Shirish Kulkarni said that Garware had their own reasons of moving on and had they continued they would have made profits, on a larger scale.
  3. Everything including the assembly plant at Wai, all the dealerships as well as the manpower now goes to DSK.
  4. Wai plant is 10,000 sq feet in size and currently bikes in CKD (Completely knocked down) forms get assembled there.
  5. Wai plant is capable of doing 8-10 bikes per shift of 8 hours per day.
  6. On a question whether this continuous change of partners from Kinetic to Garware to DSK create confusions and hesitation in a buyer, Shirish promised to make this venture work and as long as they can.
  7. Hyosung managed to sell 611 bikes in the last fiscal year (which was the first year of operations for the company) and in a market of 2500-3000 annual sales, this is a sizeable chunk.
  8. DSK has plans to infuse Rs 300 crores in this business.
  9. DSK would also want to take the Hyosung brand to tier 2 cities and plans to increase dealerships to 35-40.
  10. Shirish also mentioned that the company plans to setup a proper manufacturing plant to increase localization and bring down the costs of all the Hyosung motorcycles sold in India.
  11. This one would be a proper manufacturing plant (and not an assembly plant) where DSK plans to take the localization levels to 90%
  12. Shirish also clearly hinted that he prefers having this setup in Maharashtra but the current political clout is not looking favorable. He also stated that talks have been initiated with other states like Gujarat and a decision would be taken soon.

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