Hero MotoCorp starts ops in Africa, LatAm

New Delhi: The country’s largest two-wheeler maker, Hero MotoCorp, on Monday said it had commenced operations in Africa, Latin and Central America.

Pawan Munjal, managing director & chief executive officer, Hero MotoCorp, said: “We have started despatches to our new international markets in Central and Latin America and Africa. Our first consignments of two-wheelers have already been shipped to Peru in Latin America, El Salvador, Guatemala and Honduras in Central America and to Burkina Faso and Ivory Coast in Africa.”

The company is set to despatch the first lot of two-wheelers to Kenya later this month.

It has already appointed new distributors and channel partners in these markets, where retail sales of the Hero two-wheelers is likely to commence in the first quarter of this financial year. Hero motorcycles to be sold in these markets include a mix of models from the 100cc and 125cc range.

Hero MotoCorp has earmarked Rs 1100 crore as capital expenditure for the current financial year. It includes an investment of about Rs 600 crore on the company’s upcoming fourth plant and global parts centre at Neemrana, and Rs 100-150 crore on a state-of-the-art integrated R&D centre at Kukas (near Jaipur in Rajasthan).

These initiatives are in line with Hero MotoCorp’s vision of reaching a total of 10-million unit volumes in a few years’ time, and garnering a million units — 10 per cent of that — from international business. The company currently registers around 2.5 per cent of its volumes from sales in overseas markets.

To meet this objective, the company has already short-listed as many as 30 countries across Latin America, Central America, Africa and South East Asia.

Colombia is the only country in Latin America where Hero MotoCorp currently exports to. The other international markets where Hero two-wheelers are sold include Sri Lanka, Bangladesh and Nepal.

Hero MotoCorp aims export of 10 lakh units in 5-6 yrs

NEW DELHI: Free from export restrictions imposed by its ex-promoter Honda, India's largest two-wheeler maker Hero MotoCorp today said it aims to sell 10 lakh units in the overseas markets in the next 5-6 years. The company, earlier known as Hero Honda, has already shortlisted some players to expand its export markets in a big way in the future. On the domestic front, the company is looking to invest about Rs 1,000 crore to set up two new facilities besides expanding the output of three existing plants. Addressing analysts in a conference call, Hero MotoCorp Senior Vice President (Marketing and Sales) Anil Dua said: "We are looking at an exponential increase in export numbers ... In 5-6 years of time, we aim to sell a million bikes (every year) in international markets, which will be 10 per cent of our total business." Currently, exports contribute less than 2 per cent of total sales, he added. The company had sold a total of 54,02,444 units during 2010-11 financial year. "We have been approached by several partners for distribution and assembly. We have already shortlisted some partners," Dua said without giving further details. The company is looking at exporting its products to Latin America, Africa and South East Asian nations, he added. Asked about investment that Hero MotoCorp might put into develop its export bases, Dua said the firm will invest in future, but now it will not financially support its channel partners. On the plans for setting up of two new factories and expanding the existing capacities, Hero MotoCorp Chief Financial Officer Ravi Sud said : "When we talk of capacity, we talk in slabs of 7,50,000 units. So, 1.5 million units capacity plants. In a phased manner, it will cost close to around Rs 1,000 crore."

Netxcell to grab a slice of mobile market in Africa

KOLKATA: Netxcell Ltd, the Hyderabadbased telecoms applications service provider, is set to ink deals with MTN, France Telecomcontrolled Orange Africa and Vodafone's Africa arm Vodacom to grab a slice of the $300-million mobile value-added service market in Africa. It is in advanced talks with the firms to deliver services on both 2G and 3G networks, including customer lifecycle management solutions on the pre-paid and post-paid platforms.

Netxcell operates in Africa through its Mauritius-based subsidiary Netxcell Mauritius (NML). Over the next six months, NML will launch operations in Nigeria, Ghana, Zambia, Ghana, Mozambique and Angola, a top company executive with direct knowledge of the matter told ET. The company is present in Kenya, Rwanda, Burundi, Tanzania, Sudan and Uganda. Netxcell Mauritius is a 51:49 JV between Netxcell and Kenya's Aqua-SanTec Group that was established a year ago.

Parent Netxcell is the telecoms software arm of Hyderabad-based Prathima Group that has interests in technology, healthcare, medical education, construction, engineering and entertainment. "We plan to deliver the full spectrum of mobile VAS solutions to MTN, France Telecom-controlled Orange Africa and Vodacom. Since 3G has already gained traction in key Africa markets unlike in India, a lot of our applications will be tailormade for 3G networks," Netxcell CEO Debasish Chatterji said.

He said the company would shortly conduct field trials of its video outbound dialing (VOBD) software in 3G networks across Africa. Among a host of mobile VAS solutions, the company plan to commercialise its video outbound dialing software that can be used by a telco for video advertising to 3G users and promoting products and services. The software application is delivered, typically, through video calls that are increasingly becoming popular in Africa. At present, there are some 510 million mobile subscribers in Africa,


the likes of MTN, Vodacom, Bharti Airtel, Orange, Orascom and Maroc Telecom collectively control 65% of cellular turf. While telecom penetration levels in the southern and northern Africa markets is close to 88% and 76%, respectively, mobile teledensity levels in eastern and central African markets remains a paltry 27%.

Small wonder, Netxcell's target markets will be those in eastern and central Africa. "We believe there are serious opportunities in the eastern and central African bloc where telecom penetration is low. NML has recently launched sales and marketing offices in Nairobi, Kampala, Dare Salam, Kigali to address market opportunities in Kenya, Rwanda, Burundi, Tanzania and Uganda where MTN, Orange and Vodacom are present.

In the second stage, we are looking to expand into Nigeria, Ghana, Gabon, Zambia and Angola. We plan to also develop a full-fledged mobile VAS ecosystem in select African markets by partnering with local content developers and integrators," said Chatterji. But he concedes that grabbing market share in the mobile VAS space will be no cakewalk for Netxcell, especially since rival Indian companies like Conviva, IMI Mobile and Spice Digital are already active in Africa.