Good morning, Mr. Radhakrishnan. This is Jinit Mehta from B&K Securities. Yeah, good morning. Good morning. Sorry for the delay from our side. No issue, sir. Thank you so much for making time, sir, for this call. We've got the team of Canara Robeco, led by Mr. Shridatta Bhandwaldar. He is the Head Equities. We've got the fund managers, Miss Enid Fernandes, Mr. Vishal Mishra. We also have the CIO offshore, Mr. Abhay Laijawala, and Fund Manager offshore, Mr. Dhrushil Jhaveri, and we have the sector specialist, Mr. Bibhishan Jagtap. I have started the recording, so I will leave this call. It's a one-on-one call. Thank you so much for taking time out, everyone. Over to you, sir. Sure. Thanks a lot. Good morning. Thanks a lot, Mr. Radhakrishnan and Mr. Desikan for actually sparing time for us. We have been shareholder for some time with the company and have participated in group interactions, but probably this is one of the first one-on-one interactions we are having with you. Thanks, really, thanks for sparing time. We have certain questions that we have prepared, and our team will go through it. For convenience and coordination purpose, we'd let Bibhishan ask, who's the sector analyst, ask most of the question because then since this is a virtual meeting, otherwise it will become a chaos in terms of people actually getting, kind of, cutting each other. Let me just start at one point, and then, I'll hand it over to Bibhishan. Basically, the drivers for the industry and particularly for us, one of the drivers that has played out extremely well for us, and congratulations for that, doing such a great work on that side, has been on export side. It has reached a sizable chunk of our business now. Lately, given the challenges that we have seen in the exports market, and particularly the larger peer has faced, in fact, more challenges than you, how do you see this piece working out? What are the key challenges in the top three markets there? Do you think that it'll persist for a longer period or it'll be a three-six -month phenomenon? I'll start there and probably then Bibhishan can take most of the questions and we'll interject whenever it is needed. Thanks. See, thank you and good morning to all of you. I think what is most important is this is not the first time we are seeing such challenges in developing markets. If you look at while we are doing now the business, there is no Sri Lanka. Sri Lanka used to be one of the best markets for us. Okay? We used to sell almost 6,000-7,000 and our market share almost reached 35%. You know, economy, this is the challenges in Sri Lanka. It will come back because they can't be without two-wheelers in Sri Lanka. We have to be little patient. If you look at Myanmar, this is another country we had a huge opportunity. We started off very well. There are some challenges. If you look at Iran. Iran is another market where we used to do extremely well. All our Apache and Victor used to, you know, and Rockz from Indonesia used to be extremely well accepted. Now there are some sanctions and challenges. It's not that the customers in these markets are still liking TVS, and it will come back. We have to be patient. Okay. Now, whatever we are going through in African countries, I think we have seen it in the past. Okay. Whenever we have seen the oil prices or inflation or availability of currency. Okay. My hypothesis is only one thing. If there is some problem in one place, I think you have a good product range, maybe couple of months see. Immediately, we will not be able to respond in one month or two months because there have been a stream of things. We actually still in Nigeria, the retailing is happening. It's not that there is no zero retail, okay? Whatever you read in the media is banned and things like that. Our approach has been always, you know, manage the stocks pretty well with the distributor, whether it is inside the company with the distributor. We have practically stopped dispatching to Nigeria saying that, "Look, you liquidate all the stocks, okay? In a couple of months you will be able to do that through retailing and then we can start." At that time we will take a measured call. In the meantime, there are many other markets where we can start a little bit doing higher. For example, we are doing extremely well in DR Congo. We are doing extremely well in Ethiopia. We are doing very well in Tanzania, Uganda. In my view, these challenges, whatever we are talking about, slowness or some challenges in some market, without Sri Lanka, Iran and, you know, Myanmar, we have reached these numbers of 100,000. I'm pretty confident that going forward, I'm not disturbed. What is most important is customer starts disliking you, that is the most important thing. Okay. Then you have a problem. Okay. Inflation, some local government bans, and there are solutions. For example, there are markets where we have given certain facilities to track who is using. You know, with our technology we have given in certain markets, and we are also planning to offer that in these markets. Because these markets, the biggest challenge is they are not able to trace the vehicle. Okay? As a part of the retail financing company requirement, we have also put certain telematics so that you can track exactly and you can also, you know, disable the vehicle if the customer doesn't pay on time, so the same technology can be used. I'm not so much worried about the short-term ban what you see in Nigeria. From the countryside, please understand, they cannot continue the ban for a longer time because this is the main income. You know, they have so many millions of taxi drivers. What will the government do if these people doesn't have job? What they need to look at is what is it they need to do to trace these customers, how they are using it, how they are. Where they are going. Okay, I'm pretty confident. We have seen in three-wheeler also several times banned in these countries but it is now come back. I'm pretty confident. What is most important is consumer confidence on the brand should not go away. We have excellent even in Sri Lanka, Myanmar, Iran, our distributors are still there. They take care of the service of the existing vehicles. They're under little bit of pressure, but our team has been supporting them, saying that you focus on service parts, and in that you make profitability working with the customers. That has been our theme. Sri Lanka has done it. Myanmar has done it. Iran has done it. They are all looking forward to a day when the imports will be open. K.N., also Latam is one which is doing well, right? Yeah. Latam and ASEAN markets are huge opportunities for us. You know, we have started little bit increasing those markets. Overall, I'm not afraid about the market share growth, and we're growing ahead of the industry. Sir, just a sub-question on the same thing. Over last five years you have put in place the entire distribution infrastructure. The branding has happened. The customer associate you with a very good product. When you look at these markets, which are the end markets that you are targeting across Asian or Latin American or African, Middle Eastern countries, where do you see the potential of whatever numbers that we are doing, say, three-five years down the line? Of course, the organization has to gear up to do that over a medium term, and I assume that you would have kind of thoughts around it in terms of how do you scale up this business and what is the scalability that is possible? For Why I ask this question is basically, there are a lot of analysts who keep writing particularly about Nigerian market, that, okay, already you guys plus Bajaj plus Chinese guys are like, the market is saturated, so there is not much of scope to grow apart from the organic growth. When you look at your current kind of broader numbers, on annual basis, can they double, triple over next five years if you actually look at the target markets in terms of scalability and your presence as infrastructure and brand in those respective countries? Three things have happened. I think, the first thing is this was a highly penetrated Chinese market with very low prices. Okay? Bajaj entered, and when we entered, we said that, "Look, our prices are far, far higher, but we give a better total cost of ownership." For example, if a Chinese, product, they buy at, $350 or $400 and usability is 12 months. We said, "Our product can be 3x better than that. Our durability, reliability, usage, customer convenience, and after-sale service will help you to use it for three years, but our prices are $500 or $550. We will have a mechanism to make sure that there are proper service centers, parts, oil, everything, and they will take care of you. Initially, there was a huge resistance saying that, "No, we don't have money to buy. $100 is a huge money. $150 is a huge money." We still stayed there, and a few people bought, and then the customers, the people realized that Indian brands are far, far, far, far superior. What has happened is the Chinese proportion has come down. Now Indian brands are doing extremely well in Africa. This is number one. Number two, you asked about the potential of this market. I can tell you this is the market to be in. Okay. They don't have roads. Okay. They don't have commuting segment. It is like 30 years, 40 years back in India. Okay. No roads, no public transport, but lot of natural wealth, but education levels are very low. I don't want to use the word, you know, who have been exploiting this set of people. They have oil, but they don't have refineries. Okay. I think this is the market with education. Many people who are going for education from these countries, coming back, settling down, and investments in infrastructure like roads and connectivity. I'm 100% sure you will see a significant proportion of growth in the two-wheelers. First it will move from taxi segment. In addition to taxi segment, you will see commuting segment, you will see motorcycles, you will see scooters. Maybe you will also see EV coming in much faster because at least in the cities, they will say that, "No, we have to be progressive." Because like India is comparing Europe, I think these people will start comparing countries like India and saying that India can progress like this, why not? Okay. I don't want to give you a guidance, but I promise you these are the markets to be in. Okay? We are in. We have an excellent product range from HLX series to moped and to scooters, to motorcycles, to Apache, to RR 310, from products from Indonesia and this is going to make a huge difference. Just to give you a perspective, in the last four years, industry CAGR was 9%, we are at 18%. You want to put any mathematics, put the same mathematics for the future, I promise you that. That's a great. We'll be growing double that of this. That's a great number to work with, sir. Yeah. Hi, sir. Thanks for that detailed answer. Sir, is it possible for you just to give us a sense, which are our top five markets and how much does Africa and the other major countries contribute to us, especially Nigeria? Overall, Africa is about 50%. Okay. I don't want to give a break-up of that, how each country makes it, et cetera. I think this keeps changing, in my view, because every month it keeps changing. Okay. Because every country is wanting to expand, every country is now investing in infrastructure. This is a number which will keep growing. Overall, as in Africa, will keep growing. Number two, I think we had Asia market significantly higher, but with no, Sri Lanka. Now it is Bangladesh, Nepal, okay. Even Myanmar is not there. Bangladesh and Nepal are the key markets on this side. If you look at the Middle East, then you have Turkey, then you go back to LATAM. The entire LATAM is a huge opportunity. Then here you look at Indonesia, Malaysia, Philippines, Laos, Cambodia. Okay. We don't export to China. Okay? Only through BMW that, our joint partnership, we send it to all developed markets today. For example, Europe or U.S. or Japan or any other country, it is the K series what we make. More than 100,000 vehicles we have given to these customers in this market. That is the overall breakup. Understood. Sir, which are the markets we are the market leader currently? Or probably we are number two, number three player, if you can just- See, we are, in most of the market we are a strong number two. There are a few markets we are number one. Okay. Such as? There are markets like Ethiopia, Tanzania, Kenya. Okay? The reason I don't want to give number one, number two, I think the direction is more important. I don't play to become number one, okay? I don't want to. I want to be number one in the customer consideration. Correct. If you are number one from the customer consideration, then, we can grow the market ahead of industry. I have a simple rule. We don't know the denominator, which is the industry. We have to be growing faster than the industry. Sure, sir. Understood. Yes. Sir, just a question on the export margins. I mean, is it fair to assume that the export margins are slightly higher or better as compared to domestic market? How one should look at that aspect? Margin to me, overall margin is what we will look at it. Some markets, certain brands. We have the best range, starting from moped to scooter to motorcycle to commuter motorcycles to Apache, okay? To RR 310. As a company, we look at overall contribution, overall gross margin, because, unlike some of my competition, we are now into expanding the business. Three very clear objectives. Number one is customers should be delighted with TVS. Product durability, reliability, attractive quality, features, service, after-sales care, I think that is the first priority. If this is done and you have exciting products, both existing products and new products, with the kind of features what we give, then you can grow ahead of the industry, then the top line is assured. Okay? I'm a firm believer that if the top line is assured, every line is assured. Okay? You can have any number of contribution. You can even 30% gross margin also. The top line is not there, anything multiplied by the low number is not going to help you. The most important thing, first is customer satisfaction, second is top line, because top line is what the distributor, dealer, also the supplier wants. Any business, volume is the most important thing. If the volume is not there, nobody wants to participate with you. The suppliers, in this kind of a business, you need to have investments not only from you, the suppliers have to invest. They should have the belief with you. The dealers has to invest. The distributors has to invest. Correct? Everybody has to invest in infrastructure, people, sub-dealers. That is required. The volume is required. The brand is required. Okay? Once these two comes, you have seen our profitability. Then you can work on, okay, can I sell more of a premium? You know, can I sell more of Ntorq 125, Apache, and the kind of products in a. We started off with Apache 162 V, then 4 V, then 180, then 200, then 310. We moved like that. Even in Jupiter, when we started, we had a base version. We said that that is not going to give me profitability. I need to improve the profitability. We do a ZX version, we give a classic version, Grande version, and recently we have launched one. All are higher priced than competition. Great. Just one last- Today more than 50% of the sales of Jupiter is from those models which are higher on pricing, but we give better features, better attractive quality to the consumers. Understood. Just one last question on the export market. I think the kind of turnaround which we have seen in the Indonesia market, where initial four or five years was not good, but the last two years where we have seen a very significant improvement. I think this particular geography or this particular aspect will continue to do well, right? We do not expect any major headwind to come in. In my opinion, we can grow exponentially because the acceptance of the products in the markets are extremely good. Extremely means extremely good. We started out 2,000, 3,000, now we are hitting every month almost 10,000. We have now started three-wheeler. Now this 10,000 can be easily multiplied by two, you know. We have a separate platform of products starting from Neo, Rockz and Dazz. The benefit is it will multiply, and the more the volume, definitely you know the benefits what it can give to the whole company. TVS will do extremely well. Sure. Thanks. Sir, I think congratulations on the TVS Ronin. I think I personally rode that vehicle. It's truly amazing. Just wanted to understand, I mean, what is the product positioning of that particular model? Is it more of a retro cruiser tourer? I didn't get that. If you can just help me understand the product positioning of that one particular aspect. You have heard me saying it is a modern retro vehicle. Okay? It is not competing because many people ask me, "Are you competing with RE?" No. Okay. We look at Apache. Apache is standing for really the racing enthusiast. When we started the journey, many people said, "No, no, India you don't have racing enthusiasts." We said it will come thanks to the government. You look at highways. You know, I can tell you, if you come here on a Saturday, Sunday, there are Apache clubs, 150 people traveling together. Okay? Amazing. Whatever, whatever. See, India, the aspiration levels are very high. Even my moped customer, when he comes in to buy a moped, first he will go around the Apache showroom. Okay? Right. Aspiration is very high, but poor fellow, he doesn't have money. Many a times I ask them, "Why you do walk?" "No, no. I will buy this for my son. I understood. Okay? "But I can't afford. I will buy only this one." Same way I have seen if there is a stretch possible, they will buy the Raider, you know, 125. Okay? Saying that, "Oh, it is little bit aspirational." One thing I have seen in India is the aspiration levels are very, very high. Okay? We found that there are many customers who think Apache is a modern retro. They don't know. They come, they look at and racing and then say, "Oh, this is there, then I'll use. And I like the build. I like it is modern." You know? It is not different. It is not RE. It is completely different. Okay. Okay. So- What is the monthly volume one can expect from this one particular product? I think- If you can just- See, this is one model where it can grow. Okay, currently we are looking at 5,000 this month, but I want to keep the demand ahead of supplies, okay? These are brands where you have to be a little bit patient. If you ask me, India is a great country. Even you get a 0.001 fraction of this set of customers, it will be more than 10,000 per month. I think 5,000 number is a very good set of numbers which we are targeting. Secondly, if I just look at our product portfolio like Apache, Raider, even, and talk to some extent, I think last four or five months we have seen that because of the chip shortage, there has been a significant impact. I think this is what you have been guiding even in the con call also. What is the situation now? Apache lost quite a bit in April, May, June, and Raider also lost quite a bit in April, May, June. Thanks to our team, we were able to develop alternatives and now Raider is fully back, Apache is fully back. I don't think there will be any problem in the season. Now this month and next month you will see very good numbers. Mm-hmm. Now these numbers can go up, that I promise you, but I am not in a hurry. Okay. You know, unlike some of my competitors, I don't dump. I don't want to keep any of my dealer more than 25 days stock. In fact, I tell them, let us use the principles of OR and say, zero loss of retail. Tell me what is the minimum stock you have to carry and how will you rotate? Because whether it is my working capital, dealer's working capital, it's working capital only. Correct. From the customer point of view. Yesterday I was talking to one of my competitor. He takes 75 days stock, Jaisingh. If you keep 75 days stock, then the customer will never get a fresh product. Correct. What is the sense you are getting on the festive season, by the way? Do you expect that this year's festive season would be much, much better compared to last year? I'm pretty confident because people are fed up. You know, you go anywhere, people are fed up about these lockdowns, and I don't think people are even testing now, Jaisingh. Even if fever is there, people are not even testing. Yeah. Fortunately for us, we are all vaccinated, booster has been given. One good news is, even in the last, let us say 60 days, the number of cases where we test rigorously the COVID- Mm-hmm. None of them were hospitalized. Zero hospitalization. Okay. I think I'm pretty confident that this year's season, starting end of this month to Diwali will be excellent. Okay. Just moving to our, you know, if I just look at the gross margin, the kind of improvement which we have seen over even the last two years, the margin trajectory has been really amazing. Just want to understand, is there any drop in our, let's say input cost, what used to be earlier, let's say four or five years back versus now? If you can just help me on that line. Yeah, input we used to be 24%, I'm saying from my memory. Now it's around 7%. 24%, this was in which year or which time you're talking about? I think it was 1920, if my memory is right. 1920. We have taken a lot of initiatives. Twenty-twenty. Including, you will be delighted to see the biggest alloy wheel supplier in China. We brought them to set up a plant here in India. Okay. A small correction. 2020. I mean, he meant 2020. Yeah. Okay. In FY 2010, it was about, let's say 19% versus now it is at about 7%. 24%. 24%, now it is 7%. Okay, that's great. Any scope, you know, to further reduce that in coming time? You can reduce, but please understand we can't be without input. Okay. Certain things are not available in India. Certain technologies are yet to develop here, so we have to look at import. Import is not a bad word yet. Import is not a bad word, okay? If many of my other supplier, you know, export people, they start looking at local content and they say, "We also have to be self-sufficient," things will not work. I understand. I think we have to import those things which is required. This predominantly import reduction is from China. Got you. Okay. Sir, if I just look at the, let's say Q2 FY 2023's commodity prices, I think we are almost 20% down. If I just look at our EBITDA margin, which has been in the range of, let's say 10%, we have not dropped that. How do you see that our margin benefit will probably get flow into our P&L in coming time? Do you expect that, you know, the commodity prices reduction, you know, will help us in second half or probably in FY 2024? The commodity price increase or reduction, I have always looked at in a stable way. How do you price it? How do you price it in relation to the competition? How do you price it from the customer point of view? Okay. I honestly, I'll tell you, commodity is not in our hands, okay? Mm-hmm. There may be some three months lag here and there between certain suppliers and this one. If you get some three months benefit, you will also have some challenges going forward. Life is like that. What is most important is what are the strategies we are trying to look at to improve, let us say from 10% going forward? I think continue to create brands which can sell high volumes. Okay? Continue to focus on the premium brands. Okay? Premium brands like Apache, Ntorq. Now we have Ronin. Can I take up Ronin to next level? You know, systematically. Systematically, quarter- after- quarter, how do you build it? What is most important is premium proportion is around 30%-32% of our sales. Can it go up? Number two, exports. Your colleague asked a question. Average from 100,000, can we go up? Can it will go up. I'm pretty confident that it will go up. When the volume goes, you know about three-wheeler. Practically we are, many markets we are number one. In the export market our market share is almost close to 40%. There is still opportunity to grow our three-wheeler. When we look at volume side, earlier we had many products, many we had single source. Now we are also trying to look at second source because when you expand to a second source, there is a good opportunity to look at little bit better negotiation. You know? Okay. We are also now looking seriously at what our platforms can be common. Mm-hmm. Mm-hmm. You know? What commonization we can do. Because the moment you do commonization, you can get again, benefits. You would have seen, lot of initiatives on the, without reducing the value, without reducing the quality, what kind of innovation you can do on the design. Okay? Mm. I think these things will continue to focus on material costs. Equally, we have always looked at an opportunity to increase prices. For example, products like Raider or products like Apache, products like Jupiter 125 or Ntorq. I told you about the varianting strategy. Right. There will be base model, but we will have variants where. See, today, when a customer walks in, if he's a retail finance customer, the moment he sees the base version and he sees the upgraded version or the, you know, limited edition, he will say that I have to pay another INR 100, you know. 36 months is INR 150. He will go immediately to that. Because every customer should feel that he's getting a much higher value when he pays another INR 3,000. Okay. This strategy of premiumization, focusing on very systematic cost reduction will continue. Second, you would have seen our marketing costs. Yeah, absolutely. I was just coming to that. Yes. It is. Systematically it is possible to cut down. All other employee costs related today, it is full investments in electronics. We are looking at software. We are putting at extra people on the digital side. All investments are on the EV. Okay? Okay. I see no additional people. Actually, we are trying to move many people from IC to EV, train them, make them work on the EV side. We are working as though EV is 100%. Okay. That's why in the next eight to 12 quarters, you will see many product launches from the company, okay? Because that is what is very critical at this point of time. We know what to do, which products, what kind of interventions, which markets, that will continue. All of us, we will invest in more and more on the EV side. I think some of you can visit, come and see the facility, then you will realize, okay. Because that is the focus we have in effect. Sure. Understood. Sir, just one question on this advertisement and marketing expenses. If I just look at the annual numbers, I think even in absolute numbers also, it, the number has reduced. Is there anything changed, anything we changed on the advertising and marketing expenses? Are we moved to the online advertisement? Have you done anything like that? That's the reason why we are seeing that. Few brands we have completely moved to digital. Okay. Okay. Okay? That focus will be there. I'm not saying there won't be any advertisement in the TV or newspaper, okay? Don't get me wrong. Progressively we will move more and more to the digital, number one. It's not that digital is free, okay. Mm-hmm. As the customer requires, we will look at it. We are not afraid of investing behind the brand. Okay. Okay. Okay. Good times, bad times, we will invest behind product, we will invest behind brand, because that is what is going to give next four quarters, next eight quarters. Absolutely. Sir, just one more question on the RM cost. I think even though if I look at our, let's say, purchases of goods from the related party transactions, which earlier used to be about, let's say, 15%, which has now further come down to about 11%. Is there any scope, you know, to further reduce that? Can we expect that more cost benefits, you know, will help us, you know, to improve our gross profit margin? See, I told you, every supplier has invested. Mm-hmm. The next addition of volume we are giving to a new supplier. Okay. Okay. When you give to the new supplier, you will negotiate better. Right. Right. Right. You will put the pressure on the current supplier saying that, "Look here, the other guy is giving me so much of benefit, you also review your prices. Mm-hmm. Mm-hmm. This helps. Definitely this helps. I will not be able to put a number because I'm not so much worried about, you know, shaking up the supplier. Rather work with the supplier, which then the win-win works. Okay. As a supplier and the company we have to win. They have to win, we have to win. Dealer, distributor, they have to win, we have to win. If there is a mutual win-win, that relationship will be long-term. If it's a win-lose, it will not last. Okay. Okay. Understood. Just coming to, you know, the EV part, especially the TVS iQube. I think we have seen a very significant ramp up. I was truly amazed, you know, when I was looking at the numbers on a monthly basis. I think you were also very positive in talking about that we might even cross, let's say, 10,000 kind of number by July. Is there? I am really looking forward to 10,000. The good news is the demand is there. Okay. Okay. Okay? Another good news is now these semiconductor companies have understood that we are very serious. Okay. They have visited us, they have seen our ramp-up plan, they have seen our facilities, and they say, "Yeah, we will help you. We will support you." The support has started, so you will see the 10,000 soon. Sir, what is our current capacity, by the way, now for the TVS iQube on a monthly basis? Yeah. Current capacity is more than 10,000. Okay. Sir, how, when can we see, you know, the upcoming product launches on the EV side? If I just leave the TVS iQube, can we expect, you know, the more launches on the low speed, You will see more launches closer to launch. I will tell you the timing, because I can't really tell you the timing, but you will see more launches in this financial year. Understood. Sir, just one question on the EV side. I think largely when I look at the industry, you know, scenario, I think most of the OEMs currently are now introducing products on a high speed side, right? There is a high speed, mid speed, even on the low speed side. When I look at our probably strategy or most of the OEM strategy, currently they are launching products on a high speed side. You take even, let's say, Bajaj to some extent, or TVS to some extent, everyone wants to, you know, capture that premium pie first. But there are you know, certain OEMs or certain Chinese companies currently who are now present in the low speeds, and their numbers are also increasing significantly. When I correlated that number with moped, I think the kind of number which we earlier used to do that, unfortunately because of, you know, the cost of ownership has overall increased, macro factors have not been that great for the commuter segment. Are we seeing that, you know, those customers are now moving towards, you know, the low-speed EVs? Why are moped sales are not increasing? If you can just throw some light, and if you can just guide us on these aspects, that will be great help. Again, the moped is amazing product, no doubt about that. See, there are. First I want to answer you on the EV side. In my opinion, what is going to be sustainable from the customer point of view. Forget about I'm answering from KNR TVS Motor, okay? Purely look at from a customer side. Today, iQube customers, when I ask them: "Why are you buying iQube?" They say simply, "KNR, this is like Jupiter. Okay. Okay. This is like any good scooter from TVS. It can carry husband, wife, two children, some bags. All put together, whatever I do in iQube, I am able to do it with this. Number two. It can go good roads, bad roads, anytime, flood times, no issue. It can take any kind of flyover of any gradient, no issue. Okay? I pause here. You ask the same question to the low speed and the medium speed of the kit assemblies which are supplied by the customers. You ask them and you realize yourself, will it be sustainable? No, they don't have that kind of product quality. Those products are not that durable. There are customers of moped who buy and give it to their grandson also. Okay? Right. These customers, according to me, will feel cheated. It's a question of one year, one and a half years. Okay? To me, you have to stand in for the brand and the quality, and you have to focus on the customer. TVS is very, very serious about resonating the Atmanirbhar Bharat. We design, develop, okay, everything. Okay? We partner certain things with the suppliers. Okay, we don't have any hesitation. Okay. If you look at iQube, the motors, the controllers, the BMS system, the VCU, everything has been designed and some of them co-created with the suppliers, some we do it ourselves. Why? Because this is an investment for building a business of EV for the future. Okay. We can also buy some kits from others and assemble and give it. Okay? Okay. It may not satisfy the quality standards of TVS. It may not stand in for the durability, reliability, what we are standing for. This is number one. Number two, from the customer side, if they don't get, then they will reject it soon. Okay. Okay? Now, coming to moped, I think let us look at last three years. Mm-hmm. Okay? Because we see sometimes the cause and effect we put based on certain things. My moped customer is using, it's a mini light commercial vehicle. He carries 150 kilos of load, okay? Mm-hmm. Mm-hmm. Mm-hmm. He carries milk, he carries. Predominantly, moped is in the utility category. It is not in the commuting category. There may be few mopeds which are used by women teachers for convenience, because, you know, Indian dress system for women, very convenient. No gears. Yes. It's like, you know, and big wheels, so they can comfortably ride a moped. Okay? Okay. I'm saying 98% is utility. The purpose of this utility is very clearly they wanted to earn money. Okay, I always say that the best CSR activity in India is the moped. Every day they earn INR 100, INR 150, they run the family with that. If you look at 2020 March to 24 months, they've closed down everything. Practically, they have closed down everything. Because of the lockdown, no steady income. When there is no steady income, the bottom of the pyramid thinking is, first I have to make sure that my family survives. Correct. Okay? Okay? The second is education of my children, because I am a farmer, I am, you know, self-employed. I don't want my children to be like that. Okay? Then only he starts thinking about buying a new moped or replacing my old moped. Okay? Little statistics I will tell you, not only moped, because everybody looks at the moped number. Moped has declined in the last eight quarters, 38%. The best-selling motorcycle, HF Deluxe of Hero, has declined at the same rate, 50%. Yeah. Commuter. I hope it tells you some story. Right. Okay. If it is because of the EV kit et cetera, et cetera, HF will not come down by 50%. Correct. I always look at the cause and effect, and look at poor fellow doesn't have money yet. Poor fellow doesn't have job. The reason. See, this is the first year where we have seen a marriage season, April, May, June. Mm-hmm. There is slowly now the confidence is coming. People are going out, people are getting some job. People are able to do some plumbing job, repair job, delivery. I think slowly the economy is picking up. Unfortunately, what has happened is, thanks to BS-VI, thanks to third-party insurance, thanks to the raw material, the prices have been going up. His salary has not gone up so much. Correct. When I meet people, I'm a firm believer that India's two-wheeler has to come back. My hypothesis is very simple. Public transport is not there. Very good roads are there. People mobility has gone up. India is a young country. Rural, 50%. Self-employed, 50%. The only solution is two-wheeler. It has to come back to that 10%+ CAGR. Now, why it is not there? 36 months or close to 40 months we have seen BS-III to BS-IV changeover, GST. A smartphone is 18%, yeah, this is 28%. Yeah. Okay? We saw the safety standards. Okay? All AHO. Okay? India is full of sun here. Day and night we have sun. Okay? Correct. We have adopted AHO, then safety standards. I'm not against anything. BS-IV to BS-VI, hop, step, and jump. Now, not against third-party insurance. If you look at in the 36 months, the prices have gone up by more than 45%. Have the income gone up by that? They're scaling all up like that. Give some time. It will come back. Promise it will come back. Okay. Okay. Sridhar, just to conclude on EV. Earlier you were speaking about EV, and there was one question which was pending. I mean, you said that demand is not a challenge, clearly. That's the indication you are getting. So when I look at that 6,000 to 10,000 to 20,000 or 30,000, whatever those numbers go to over the next one, two years, how's the distribution strategy? I mean, we don't find the product present in even some of the metros. So is it more a supply chain challenge as of now? Because you said that there's no demand challenge. And how are you trying to resolve that supply chain challenges? Is it that the entire thing has to be done in-house? How much of value addition is happening in-house in EV side? I think that entire supply chain value addition internally, and how do you plan to scale up the distribution on EV side? Basically, the presence of EV in your existing distribution would be interesting to get your view on that. Thanks. The iQube most importantly, whatever I said, is getting the customers like the product. That's what we have done with few cities. Now we are there from 33 cities, now we have gone to 88. Are we there in all India? No. Definitely not. Okay? Now, we are close to booking of almost 25,000 vehicles, but I don't want to take any more booking without delivery. Now, from the delivery side, the semiconductor suppliers are fully supporting us. Please understand, even for semiconductors, again, let us look at what has happened in the semiconductor industry. All of you know that the auto grade, what is used in the automobiles, are the best grade, highest grade in terms of quality and standards and safety. During this pandemic, everybody closed down, okay? Almost three months. Then pick three companies. Renesas in Japan. Renesas, you know. They had the fire accident. TI in U.S., you know, they had the biggest flood. Okay? One more company in Europe, they also had flood. These are unheard. Okay. Okay? Weak capacities destroyed almost 60 days- 70 days. While this was happening, everybody was on Teams, like us, Zoom, smartphone, sitting at home. Suddenly you saw disproportionate growth in the semiconductor PC industry. Sorry, the consumer durables and smartphone and connectivity and all this industry. Okay? Today, every company is talking about 52 weeks of planning. We have planned 52 weeks back. That is why I'm getting the confidence. Okay? Month after month you will see that, and you will see things improving. One more most important thing is, the logistics times have gone up substantially now. You know, what used to come in 30 days comes in 60 days. Due to some reason, if the raw materials are not available, and many of the flights you can't reschedule because all flights are full. Okay? Many things are good news, but many things it also gives us little bit of challenge. We have to systematically now look at how do we go month after month to 10,000, then to go to 15,000, then go to 20,000, then to go to 25,000. That is the focus that we are in. Sure, sir. Thanks. How much, one part is still unanswered. How much of the value addition is happening internally at organization? I mean, how much of integration has happened? Many of these PCBs, et cetera, we buy from outside. None of them are manufactured inside. The design, for example, of the BMS system or controllers, or some of the motors along with the supplier, like that we have certain things we completely design and develop. Certain things we design, manufactured by the supplier. Certain things completely supplier part we buy. Okay? Okay. For example, in the new iQube, the VCU is completely designed by, manufactured by our supplier in India. Okay. It's a combination of make and buy, and completely buy. This strategy will continue even for future. Okay. What is most important is designing. You know? Most important is designing in-house because that is what is going to give us the biggest cutting edge for the future. Sure. Thanks. Thanks. Sir, one more I think, concern area or, you know, this is something which I really want to understand is more on the investments which we did on the EV side or even in subsidiary side. Can you just help me understand what was the thesis behind, you know, investing in EGO Movement? It's a Swiss, you know, Swiss-based company who majorly into the e-bikes. Again, they are not completely a two-wheeler motorcycle company, it's a e-bike only. What was the thought process behind investing in that company, sir? You know our complete range and you know our EV strategy in India. Correct. You know, Norton, you know. It is really the premium. Premium bike. When we look at EV and Norton and some other products what we are making in the K series, we can go to all the developed markets. One of the thinking process was even in the developed markets, e-bikes or e-cycles are becoming very predominant. There are two approaches. You design your own e-cycle and then start producing and then going to manufacture and look at the customer. We thought it is, you know, best way is to look at EGO or SEMG, who have got omni-channel, and they have certain products, and understand the consumer in Europe. Because there is a huge market, and it is projected that it will get into a CAGR of almost 18%-20% year after year in the e-cycle segment. In order to save time, we felt that it is best to invest in these companies and really understand what profile, what type of customer, what kind of, you know, demography, what are the usages, okay? At some point of time, we can look at it, how do we scale up, okay, for different countries. We can leverage our design and different capability and also look at what are things we can do from India. At this point of time, it is completely the kind of products just ahead of the product range what we have. This is one thing which is likely to change in the future, e-cycles. That is the thought process. Is it? So cycles is a, you know, it's a completely different product what we generally manufacture. But it is about the production. Is it about the distribution? Is it about the other capability which will get it? Basically it's understand the consumer first in Europe. We have never been in a developed market. Never. Even the exports we are doing is almost 70-75 markets are all developing markets. Okay. We have sold through BMW the product 100,000 globally. That is, through BMW brand, we have an understanding of what are our capabilities. If you look at European markets where the set of customers who are buying the e-cycles, what is the profile, what is the demography, what is the usage, what is the distribution system. The best way to, you know, go quick into the market is to invest in this kind of companies and then understand. Please understand, SEMG is a profitable company. Yeah. Good. Secondly on- Sorry, Vivek, just to continue on this. From a longer-term perspective, the strategy is to push the cycles as a product to other developed markets and maybe even in some developing markets? Or is it that we would be looking at, leveraging our EV and the premium bikes and after understanding the customers, we would like to push this into the developed markets? Both. Because, see, one thing about iQube or any EV vehicles, global market we can go. Absolutely, no problem. The K Series, whatever the RR 310 and above, we can go to every market. Today, we are in the developing market, we can go to the developed markets. Okay? We will have EV products from India. We will have the higher series products, which we are partnered with BMW. We have the e-cycle. We will have a portfolio of products, okay, which we can leverage for all the developed markets. Definitely, we can look at for developed markets. We can even look at for the developing markets as well. These e-cycles, you know, once we understand, then we can have it, even in the developed market, developing markets also. It is a very clear understanding of how to and what kind of products and what kind of customer segments. See, please understand one thing. The bikes what we are selling for Africa is completely different. It's not sold in India. You need to understand. The strength of TVS is we go to the market, we understand the consumer. Even in India, I don't have to explain to you. You know, we South Indians, we want dosa and idli in the morning. Okay, you go to North, they want, you know, paratha and chana in the morning. Somebody in Gujarat wants to start with sweet. Okay. I have seen Apache, only black color will sell in Kerala, only red color will sell in West Bengal. I think we have to resonate with the customer experience, customer requirement. It is very, very important that you have the product range, understand the consumer usage. It is a very clear matrix of which product, which market, what kind of, you know, strategy we can have. Just, Sidharth here. I mean, just to continue, this has been one of the kind of at least confusing issue or complex issue for us as an investor to understand. This has been a sizable commitment for learning in e-bicycles, which you don't know how it pans out. Nonetheless, about the- I correct you. We may not tell you how it pans out. We know very clearly. Okay. For example, when we invested five years back, I have met many people like you. They asked me, "Why are you investing in TVS Credit Services?" Today, TVS Credit Services is one of the finest financing companies with very good returns. PT TVS, many people have asked me, "Why are you investing in Indonesia?" That too, think of Japanese. Almost 99% is Japanese. Why are we KNR going and investing in Indonesia? Today, Indonesia is becoming successful, and years will prove that we'll become far, far successful than many of other competition. Three-wheeler, we came last. We were the last to enter into three-wheeler. Today, our numbers, we are practically number one in many markets. We are at 40% market share. I am of the view, people generally say that, you know, you will get the first mover advantage and all. Even a fast follower will have advantage, please understand. Number two, I think you invest for future. You look at the future trends, invest in that. Okay? Sure. Scale it up. Be patient. You know, you be patient. Don't get disturbed by one quarter, two quarter, three quarter, even if you have to take some losses. Treat that as investment. That is the approach we take. Okay, today I can proudly say that more than 60% of our portfolio, which we invested about four-five years back, are returning very well, better than the industry. Sure, sure. Jeswanth, you want to add on about TVS or anything more? Yeah. No, no, I just want to tell you, TVS's performance has been exemplary. We have crossed INR 16,000 crore in the book size. We are not providing for the NPAs for the last six months continuously now. It's doing extremely well. The collections are better than the pre-COVID days today. We were cautious in deployment for quite some time now because of Three years back or seven years back when we started, we were 100% TVS Motor. Now, the dependency on TVS Motor is less than 30%. Interesting. Interesting. We may have to wrap up in just five minutes, please, last few questions. Yes, sir. One or two last questions on the same thing. This INR 1,800 crore commitment, correct, or total division? That will happen over what period in this acquisitions? Which one? The INR 1,800 crore. Where is that number? What is that number? Division total number is INR 1,800 crore, correct? No, no, sir. What I was referring to is, I think, during this year in FY 2022, probably investment in our subsidiaries, we did about INR 1,400 crore, right? How one should look at that number for the next two or three years? Which are the significant investments one can expect in the subsidiaries? It is strategy driven, and it is purely from looking at. We have a very clear strategy to look at how the company has to be in the next five years, 10 years vision. In that context, I promise you, whatever we invest, it will give returns. You look at our consolidated also, you look at our TVS Motor or TVS AS, you look at it. In the last three years, when there were a lot of headwinds, and I agree that relatively our profitability is lower than some of the competitors. If you look at the momentum in the last three years when tough times were there, we are consistently performing better and better in relative terms, and you will see that performance to continue. Same way I spoke about PT TVS, I spoke about TVS AS. I think the new investments will definitely start yielding much better results going forward. I'm pretty confident that we are investing in the right segment as per our strategy. These numbers will depend upon the strategy and opportunities, what you see. Most importantly, I believe that, for example, some of the people have asked me, "Why you will succeed in Ronin?" I understand the customer here. I don't look at the RE. I look at my customer. A customer who comes into my showroom and say, "Apache, but, you know, I want like that." Okay. Then what is the size of the market? I understand the market segmentation. I look at from the industry. Okay, leverage the platform and see what all things we can do. Here comes Ronin. Same way, the genesis of Ntorq, you know. We have the design and development capability. Most importantly, if you have the design and core design and development capability coupled with the customer understanding, you can come up with delighting products. That is serious. That is what you have seen in Ronin. You will see Ronin becoming a 10,000 brand. Okay? Only in India. We can take it to other countries because we have this platform. Okay. Sir, last question. As you said that there is a momentum in cash flows, and cash flows will only go up as our profitability and everything keeps moving up. The largest allocation of capital incrementally, is it fair to assume that it will happen towards the EV part of our business? Maximum will be EV only. Okay. Maximum will be EV only. Because ICE we know, you know, we will put some incremental, you know, investments in the designing and developing some things. We have practically most of the platforms ready, you know. The innovation part we will never stop. Disproportionate investments will happen only in EV. Future mobility. Let me use the word future mobility. Thanks. Thanks a lot, sir, for sparing time. Thank you. You are most welcome. Whenever you people are available, tell us in advance. You can visit the factory, spend time with us. Sure. Seeing is believing. Because many of the questions, many of the colleagues, whatever they ask, you walk around and spend about three-four hours here, okay, you will get the answer. I promise you that. Sure. Thank you. Thanks. Thanks a lot. Thank you, sir. Thank you. Thank you so much. Thank you. Thank you, sir. Thank you. Thank you, sir. Four. Four. It was a tea session. I think we'll do a quick round of intros, sir. I'm K. N. Radhakrishnan, President and CEO. You've been the President and CEO for how many years now? I moved to Director and CEO. Uh. You are, every time you are introducing me and demoting me. President. Jeswanth, this guy has been de-promoting me. No, sir. No, that's a strong objection to this. Very strong objection. You became the CEO in which year? That is not relevant here. Is that 2006, sir? Or no? I think it should be. No, no. Don't do that. Okay. He's a veteran of the group. He earlier was with Brakes India. The Sundaram-Clayton, the brake business with TVS, John, he was the president of that before he joined TVS. I think, Quality Hawk- No, no, I was not president. I was head of TQM there. TQM and planning. I moved here, then started with India business and then moved into this role. This role. You've been with the group since campus. 38 years. 38 years in the group. IIT Madras. With Mr. Ganesh Srinivasan, 38 years. IIM Ahmedabad, IIT Madras. Mr. Desigan again is with the group from the start, sir? Yeah, 30+ years. 35 years now. 34 years. He's the group CFO. Right. With investors, I think, Kevin. Kevin comes from UBS Asset Management Singapore. We have Yanling, again from Singapore, GIC. Right. David comes from Taipei, from UG Funds. That's his first to the plant. I think the three are coming to the plant for the first time. Then we have Nikunj there, who was with me in UBS in Bombay. Then, Jigar on the left-hand side, from Baroda BNP Paribas Mutual Fund. The Baroda BNP Paribas Mutual Fund. The JV between BNP and Bank of Baroda. Rahul comes from Goldman Sachs Asset Management, GSAM, from Mumbai. Sandeep has been to the plant earlier, and he's with Franklin Templeton in Chennai. Oh, you're from Chennai? Yeah. Oh. Yeah. Any quick impressions of your visit to these two plants? You would have definitely visited many plants, I promise. Any feedback? Is the ability to produce both ICE and EV on the same line? Yeah Something special for us or. Next year. No, next year. Is it something unique to TVS or other companies are doing it already? I don't know. I don't know. See, the difference between ICE and this one is engine. Here you have the motors and controllers and otherwise, the chassis is same. There is no petrol tank. Styling parts are there. Instead of petrol tank, you will have to package the battery. So far we have not tried with the same line, but we are going to do it in the same line. Mm-hmm. Okay. There will be some challenges. Mm-hmm. This is like the challenge when we went through when we started with BMW. Mm-hmm Every day we make 120 country-specific variants in that line. Mm-hmm. One to Japan, one to Canada, one to U.S., one to Berlin, like that. Each one has got specific colors and also the manual, you know, the customer manual is different. Mm-hmm. I was very much afraid. Mm-hmm. N = 1, because we are a company we look at on a daily basis. We produce about 14,000 vehicles and that's mass production. Mm-hmm. Here it is, N = 1. Mm-hmm. I'm very sure our people have the ability to look at how to produce in the same line, both EV and ICE. Next year. Okay. It looks like it's ready, actually. It looks like you can do it now. Possibly. What you have explained. Possibly. What you were explaining. Yeah In terms of scaling up some of it. Possibly. Any impressions about the plant visit? Very nice. Very clean. Since it's a very old plant and still it's maintained very well. 40 years old. Yeah. It doesn't look like that. Doesn't look like it. I think I've been to many Japanese plants, and it reminds me of a Japanese plant. The way everything is very well mapped out. You You know, even the way the line moves and how everything is sort of manualized to make sure that the losses and inefficiencies is minimized. I was actually very, very impressed. Lot of see the TQM vibe is an Indian way. Our sensei have been from Japan. Mm-hmm. Suda. It was Suda. It was Washio. Okay. They from the Japanese Union of Scientists and Engineers. They have been part and parcel of, you know, working with us. Also TPM, total productive maintenance with JIPM, Japanese Institute of Plant Maintenance. So- We also look at Toyota Production System in a big way, TPS. In the pricing and the U.S. We look at, you know, all kinds of. Different- lean systems or the TPM systems or TQM systems and try to. Take the best out of it. Take the best and adapt it to the local. Mm-hmm ...people. Just- Yes, sorry, go ahead, Yanling. No, go ahead. This was done, like, right at the start of this plant or in recent years, you know? It was done long back. Mm-hmm. What is most important is, for example, when we went into BMW, their standards, in my opinion, are the best. In the two-wheelers, the best quality standards are BMW. Mm-hmm. No Japanese. I would rate BMW's good. Their standards are the best. We co-create many things with them. Mm-hmm. I can say with a lot of humility that 100,000 bikes we have sold now from this line. Yeah. They are extremely happy. Yeah. BMW team always says that your quality is equal or better than the best. Yeah, when I saw the BMW portion, it's very different from the other portions. With BMW case, with your management experience, would you expand such an OEM model to your other brand? Could you repeat the- The BMW, the way they manufacture BMW. Yeah. You can do the OEM for BMW, you can do for anyone. Okay. He's saying, will there be a similar arrangement with other brands? The future will answer your question. See, there was a specific interest between both the companies in 2012. They had a good philosophy. They had customer orientation, quality orientation. We also had the same thing. Fortunately, we had above 300 cc, an opportunity to partner. I think it's partner with that. One thing I can tell you, when we partnered, we started off with, it was their design, the entire development and the supply chain and the manufacturing and the quality was ours. We have agreed for another relationship that the entire design is also ours. Mm-hmm. For BMW brand. That is going to be a cool EV bike. EV bike or scooter? EV two-wheeler. Okay. Yeah, that's what. Let me not use the word bike. Bike means you will think it is motorcycle. Yeah. I don't want to say the form, but it is a two-wheeler. It's a cool two-wheeler, let me tell you. It will really, really surprise the market. You guys have done the designs, the development. Design, development, supply chain, manufacturing, everything is for them. Global, all markets. We will have same platform for our TVS. More a little bit like Maruti and No, not Maruti. Toyota. Here, their product. Everything is theirs. BMW- See, there is no JV here. Please understand, the relationship between BMW and TVS is. We have not invested, they have not invested in TVS. It's a pure partnership of both companies developing common platform and using in their own brand name. To that extent, I can. The RR 310. Now they have launched the same bike with BMW brand in India. The Apache 310 has been rebadged as a BMW. Yeah. Same TVS product. It's entirely the same, just a different brand. Brand alone is BMW. That's it. Everything else is TVS. TVS design. They're saying that this design is good and we'll use it for BMW. No tweaking of the brake. Nothing. Nothing. Nothing. Same bike, different airtime. The color scheme will be different. BMW color schemes and higher price. How does the economics work for you? Is it, No, it's not the economics. I think you have to look at from the confidence of the BMW brand. Mm-hmm. If somebody has to put the BMW brand on your product, you should be feeling proud that they are recognizing your quality equal to them. No, no such company will lend their brand to anybody. The relationship is actually different, right? First, it's the product that you have used for them overseas. Then it's this cool EV two-wheeler and now they say, "Just take the Apache." Can we market or people will know that. We can market globally. We can market. Let's say, will consumers know that, "Hey, actually our Apache RR310 has. The BMW is actually just the. Consumers must be knowing. Yeah, it's getting the customers sophisticated. Consumers must be knowing. The price difference is. Price difference is there. Because a big brand has got a, you know, a premium. Yeah. What is most important more than the price difference, I think if a brand like BMW can say that, "I want to use your product and put my brand there," that is not easy. You have a lot of confidence. That is not easy. I don't think in the history there will be many such cases. Oh, okay. In the newspaper, I saw an interview about you. They say you spend 80% of time to do the electric two-wheeler. Well, I should be careful, no? I know. May I know a little bit about how do you spend 80%? What is- See, like I said, top management, I think this company knows it is very well. There are enough people who are trained on products and technology and manufacturing and supply chain. If you had asked me the same question about five years back when we were having the relationship with BMW, I would have said no. Mm-hmm. Today, thanks to BMW also. Now we know that even developed markets. Mm-hmm. Our engineers know what to design, what to develop, how to deliver to appearance, quality, many aspects. Now, EV completely all of us need to learn. It is learning and developing and, you know, putting into the market. It's the combination. It's not only for me, the entire top management team. Mm-hmm. Of the company understanding EV technology. We believe once you are serious, you have to design yourself. Okay? Not source a few parts and assemble and give to the customer. That is not going to make a difference usually. When I said 80%, significant proportion of my time, okay, goes only on that. For example, we have now a dedicated, you know, more than 150 people in the digital side. Two years back, it was not there. Even interviewing them, understanding, and there is a lot of reverse mentoring you get from them. They will teach you many things which you don't know. Yeah. Digital systems, what software or what is it? Every aspect of digitization. How things are going to be looking differently in the future. Mm-hmm. Same way the software side. Yeah. Same way the electronic side. Okay? Same way, who knows, motors, controllers, the new series of. See, we know very well on the chassis side, on the basic motorcycles or scooters we know. But the entire EV cell chemistry, cell technology, BMS, every area there's a huge learning. How big is the R&D function for EV and in totality? Because there'll be a lot of shared services also, right? Yeah between EV and I think what is more important is not size. I think the right. Yeah, sorry. Right area you need to invest. Mm-hmm. Right? So far we have not disproportionately invested in digital or in software or in electronics in a big way. I'm not saying we don't have people, but this is disproportionate investment. Because this is going to make our belief is that it is going to be a smartphone on wheels. Future is going to be smartphone on wheels. People also use it for mobility or commuting. As Tesla says, "A wheel on computer, not a computer on wheels. Mm-hmm. Do you agree? Are we going that way to be fully computerized and digitized and to control by the computer to the very depths of the whole system? See, the only biggest difference I see is, we always invest in the core technology. That may be the reason our R&D costs are higher. Yeah. Our product costs are higher. Our depreciation is higher. That's true. Okay. Many a times people ask me, "You compare your competition, why your depreciation interests are higher? Why your marketing costs are higher? You have too many brands. Yeah. We look at the customer segment and we differentiate. When you travel, a platinum customer is a platinum customer. Economy customer is a economy customer. Business class customer is a business class customer. If you combine them, I don't think people will be happy. They may not be unhappy, they won't come back to you again. Many friends, I always tell them, "I don't work for this quarter, I promise you." Will this company, this brand will be there for 50 years, 500 years? That is what you need to decide and then say, "These are the investments we are going to make." We are so much focused on. I'm not against profit. Don't get me wrong. But will I be aspiring to become 20% EBITDA? I also want 20% EBITDA, but not at the cost of investing where R&D, capability, brand. Those areas, if we have to invest, we will invest. If you had to sort of list out the areas that you need to invest by priority, what are they? Now the priority is fully EV. Within the EV, what will be the priority? Software. All products, all areas. I told you the core is wherever the customer differentiation has to happen, we have to invest. Which would be these areas? Yeah, in EV. I may not be able to share this. No, but I'll. I can give you an analogy. Yeah. I can give you an analogy. You look at Jupiter, there is a 110. Even in Jupiter 110, you have a ZX version, you have a classic version, you have a Grande version. Okay? Now we have a connected Jupiter. Okay? Then we have a 125 Jupiter. Mm-hmm. When you go to 125 Jupiter, you have seen the complete design. Mm-hmm. Okay? It has got two helmets, it has got a front fuel filling, it has got the entire gasoline tank is in the bottom. It is not just making engine alone to 125, which many other people do. Okay? That is not an addition to the consumer. Every time you have to give disproportionate value to the customer. Okay? Then Ntorq. Ntorq is a completely new version of engine. It gives the best power. It is for young people. Young men and women. Okay? It has got even voice assist. I can only give you analogy today. All this will be seen in the EV space. Software clearly stands out for you. Connectivity is software led. May I answer you? Yeah. As a software-oriented product, you have a difficulty to acquire adequate engineer to do that. Yeah. I think the most traditional industry guys has a difficult. Yeah To allure tech technicians to join them. Like Volkswagen. My story. Have you seen any of our voice connected or connected clusters or have you tried any of our- No, we didn't get the time, to be honest. Okay, in a way to answer this question, those are in-house or it's, in-house developed by you guys, right? They're totally in-house. In-house. What will be the strength of your software team across everything put together? Again, don't- Okay. If I say 1,000 people, is it going to solve the problem? No, no. I think we understand you need to have. We firmly believe that you need to have. I'll give you an analogy. If you need technology, it's not that number of people will give you technology. You need to know where you will get the technology, how you will get the technology, what are the core competence you need to build in-house. 30 years back, we partnered with best-in-class universities globally. We put our students there. They did their Ph.D. there. This iQube was developed 10 years back, not today. That was a plug-in hybrid or something like that? We started somewhere, the journey. Ah. Okay? We send something like 40 engineers every year to best-in-class universities globally. There's quite a lot of investment in people learning technology. The iQube Lab that was set 5 km from here, every day we train about 600 people. Mm-hmm. on various subjects, including quality, TPM, TQM, basics to EV, advanced future mobility. There are best-in-class professors globally. There are best-in-class consultants globally. We don't mind investing in developing people. Is there technology transfer between you and BMW on the EV front? Are they also behind? It's not technology transfer. I think you learn from each other. The core product is yours. It's a TVS- It is completely designed by our team. Mm-hmm. They look at our capability. We have their capability. There is always, you know, when people sit together, there is a mutual learning. Yeah. Oh, you tried this testing? No. Or this is the rating test. Oh, okay. This is the way it is done in Munich. This is the way it is done in Europe. These are the things which we will have to look at. Then somebody will say, "No, this is the way we do it in Rajasthan." You know, Rajasthan is one place, it is 50 degrees, 60 degrees. It is even worse than Gulf countries when it is summer. Oh, we have not even heard about that kind of temperature. Okay? This is the type of excitement. Mm-hmm. There is always, I believe, that any relationship has got mutual learning. There's nothing but technology transfer in one way. Win-win works. Yeah. Okay? If it only flows one direction, it will never win. Mm-hmm. The flow has to be together, otherwise why should I spend time and tell you these are the things I do? Nobody will tell you. They expect something from you. Oh, oh, these things I can learn from you. Brilliant. Then I can also teach you what I have. Which EV player globally do you look at to learn, to pick up learnings from? Honestly, we don't look at any EV player. We look at the customer. Okay. Yeah. Because when you look at the customer, for example, we find that customer usages are different, customer test cycles are different, customer charging behaviors are different, usages are different. Then you have some challenges. For example, suppose you see some bottleneck. Again, analogy. When we went to Africa, some of the African market, we go to rural. We find that people are using adulterated fuel. They're using kerosene. They're using something else. I can't say that that is not the kerosene to be used. That is not the fuel to be used. Okay? The dust levels are different. I can't say that, you know, my bike will work only in this condition, and customer will reject you. Mm-hmm. We said, "Look, you must understand how to make your bike work in those conditions." Bring those oil, bring those things, put the dust. See what kind of filtration you need to have. Right? To me, everything is customer. Customer usage. Generator, I said, you know. You won't see anybody talking about 50 degrees and 60 degrees. Mm-hmm. The moment somebody said, "Oh, Radhakrishnan is like that." We have never heard about Rajasthan. We know only Gulf countries which goes. It is in India. Mm-hmm. You ride there during peak summer, then you realize, oh, amazing. The sand also during that, you know. Sand- -tufan, what you call- Sandstorm. The sandstorm in the peak summer. You get it. Oh, you get it like that. Oh, wonderful. You go to these people, they will tell you -10%, -15%. Mm-hmm. Which many people will say. Yeah, -10%, -15% is okay, no problem. Mm-hmm. More and more higher temperature, then there will be a problem. There is a mutual learning. I've seen the same principle with the suppliers also. Mm-hmm. You go to a good supplier, you know, Motherson Sumi or Sona Comstar or somebody. They will not just take whatever you say as an OEM. They'll say, "Hold on, hold on." They will say. They will have structured questions on the customer usage, then say, "Okay, this is your requirement. We will come back to you." I have always seen, okay, this kind of co-creation. I use the word co-creation. Mm-hmm. Do you think it's necessary to have cell manufacturing in-house? Definitely you need to have manufacturing in-house. Battery cell manufacturing. Battery cell manufacturing. To me, it's too early. Mm-hmm. The reason is the chemistries is changing. We started off with 18,650. Now it is 21,700. You started with 1,860. That's much more expensive, complicated, right? 18,650 we started with. That was what was available. Ah. The next series has come. Now next series will come. There is. See, the manufacturers have got their own energy and density, cost, volume, the NMC, LFP, various combinations, applications, cylindrical, pouch. The variability is so huge, and each one has got the best application. I don't think this is the right time to Make a decision. -decide. Sure. In my opinion, designing a two-wheeler or designing a three-wheeler which is liked by the customer is our priority. Mm-hmm. Okay? Work with those competent, outstanding quality suppliers at this point of time. That's why I say certainly it has to be right. The buyer has got a very detailed decision-making, you know. Standards and quality and safety and every parameter, and then you say, "Okay, we will partner with them, and we'll buy from them or whatever." They will do the research, and we have to be aware that these are the things which are likely to change. The BMS has to be done in-house, right? BMS is ours. Yeah. Because it has got an influence on the customer, the performance, the characteristics of the bike. Mm-hmm. When I say bike, don't get me wrong, okay? A two-wheeler. Two-wheeler. We quite often use the word bike. Bike means it's not motorcycle, so. BMS technologies, we have developed in-house. In-house. Partnered with someone? In-house. What other critical components we are planning? Controllers, VCUs. We are planning to do that in-house? We have already done. VCU is also the power control unit. Controllers. Integrated VCU, including the display, the TFT. Whatever you see in iQube is all designed and developed by us. Okay. Motor, you didn't mention motor. Motor. We partnered with some of the suppliers, design co-created. Okay. Because there are requirements on the motor. Mm-hmm. For delivery of certain performance, you know. We co-created. Motor is one area maybe we will decide which type of motor maybe we have to buy, which motor we have to make. Those discussions will come. That's why I expect, you know, all these things get evolved in the next three quarters, four quarters, five quarters, six quarters. You will see a big change. Different application may need different economics. All this requires your maximum time. Yes. to the top management. Because we don't know, honestly. Mm-hmm. Which type of motor we have to decide. Somebody will say, "What amount of, you know, in case a commodity is available because of geopolitical reasons, should we make that kind of a motor?" Oh, okay. Somebody has got a patent. Okay. You need to get involved. That's why EV is a learner, a great learner, a new learner. How much of the supply chain is already available within India such that we can. I think in India, one thing I'll tell you. My experience in the last two, three years, outstanding. I think there are some suppliers who are really, really able to think out of the box. Mm-hmm. I'll give you two, three examples. You saw RR today. Mm-hmm. That cluster, the TFT cluster. There are big companies, Bosch and company, globally. We are discussing with them. One, they always look at the high end. Their priority goes there. They get good prices and lot of development costs they get. Mm-hmm. Every time they will say that, "Yeah, we will give you. TFT is very important." Time was going. In my view, if you look at an Apache RR type of a customer, he says, "Why can't you give me a TFT cluster? I'm willing to pay." The premium customers, they are ready. They are not looking at the money there. They want the features. They want the technology. You'll be surprised that it's completely by Indian supplier. Our design. He made it in big class. That also amazed me why Indian customers want so many functions. Even their budget might be limited. Let's consider two-wheeler buyer mostly not that rich or they are cost sensitive. Like, all I've been told by the users of Maruti. The success of Maruti, because of the design of the car, we keep the maintenance low, maintenance cost low, fixable and blah, blah. It all adds into cost. Right now, like from yesterday to today. Our team have visited many different players in this area. All of them told us, "We are aiming a little bit higher and with more functions." Not less. Let me ask you. Why everybody buys? Smartphones. -Apple? Apple, yeah. Because they are rich. What is the series? 14 or 13 point? I always get it confused because every time there is a new series. Why? It's a fancy. Monocle. They have a brief- All bankers have. Smartphones. They have large share. I think, iPhone. You see iPhone penetration rate in my company is about 95% of the workers. The global situation, not only in India. Everyone thought that the pandemic is going to create more problems, but every company, in my understanding, have done extremely well, whoever has been dealing with premiums. Most people. Okay. We discussed about issues in the entry-level, moped and motorcycles. You go to my market, my dealers doesn't have Apache, my dealers doesn't have Raider, my dealers doesn't have high end, any of the products. Rich people are rich. India, population, okay? Even 1% is a huge market. Okay? This is not only for two-wheelers. Even for cars. Okay, that's my theory. Maruti was the pinnacle of 2,000. 2,000. 20 years back. Now Maruti is not their aspiration. Yeah. Okay? Hyundai. Okay, recently, I'll give you one example. I have two daughters. I asked one daughter, "So what car do you want?" "Kia Seltos." Indians' aspirations. A moped customer walks into a showroom, okay? He will first go to RR310. He'll walk around. He will see that. He's going to only buy a moped. Okay? Then you ask him, "You are anyway interested in moped?" "No, no. I'm I'm looking RR310. At some point of time, I can buy to my son or my daughter." That is why everybody wants to invest in India. Aspiration. Very young country. Take you in the weekend, go to any highway, you will be amazed. People having big end bikes, big end scooters, all premium products, clubs. Okay? Everybody will be riding. From India, you go to any flight, business class will be always full. Yeah. You will get seats in economy class. Oh, yes. Uh. This fact is so. I think that's the answer. I always tell the people, "Look, India is the place." The consumer segment is also like that. The aspirational levels are like that. Let's see. Okay. Now, if that's right, but for two-wheeler, if I am this side, I don't want a two-wheeler. If only people is on this side want two-wheeler. Which side? Poor side. Poor side. They look at something like Jupiter, or they will look at something like a Scooty, or they will look at entry-level motorcycle or moped. They may say that, "Look, I don't have I have only so much of money." I call them budget customers. Mm-hmm. They will say, "Look..." Because they are completely driven by the economy, agriculture, the income what they get. This is very important that we cannot forget about that. The young country, young people, aspirationally high. Okay? For example, when I look at Ntorq plus the Apache plus- Raider. Jupiter 125 plus Raider, my sales is more than 40%. Okay. Month after month it is going up. Mm-hmm. Okay? Month after month it is going up. Okay. They want latest. They want ride modes. This bike has got ride modes. Why, why only 1,200 cc? I want ride modes here. You know, we have a concept called build to order. Any model you want. We give a menu and build. My team presented to me, "KNR, we will have 50 per month capacity." I said, "Don't even start. You will have 100." "So many customers." I said, "Minimum 200- 250." Now I booked for three months, 250. INR 250. What's the price? Per month. What's the price? It will go to Maruti price. three and a half to four lakhs. No, since he knows Maruti, I'm telling him. INR 350 thousand-INR 400 thousand. He wants to really, really show off to his friends, his features. Just like, the secretary always has the best iPhone. Yes. That is something. I think the reason why I spoke about India's aspiration is. Secret. India has got huge opportunity, and India, unfortunately, doesn't have good public transport. Lot of investments in the roads. Mm-hmm. If you look at last 36 months or 40 months, we had BS3 to BS4. Then we have GST. This GST is 28%-18%. My moped GST is 28%. Real, real. Okay, he will tell you more details. This is 18%. That is 28%. Okay? Then we had BS, then we have AHO, All Time Headlights On. You see India full of sun. Okay? Somebody benchmarked Europe. Norway. Yeah. Okay? Safety standards, ABS. 125 cc and above, ABS. Mm-hmm. You travel in our city, how many people are able to travel 100 km and 125 km? Correct? We have BS6. BS4- BS6. Our insurance people said, "No, third-party insurance should be five years." Okay? In the last three years, the price of the products have gone up by 40%. During this period, we have almost 24 months of lockdown. No income for the 50% of the self-employed in the rural. That is what we are going through. Mm-hmm. I'm pretty confident that given some time, this rural segment will be good. Given some time, because these consumers are very aspirational. They want to buy the bike because they have mobility needs. Half of them, they are either plumber, carpenter, electrician. They go home to home. They repair, they get the money. They supply certain. They deliver some parts. That is the job. Sir, can I just confirm something? 'Cause I guess what his point is that if you want to target the aspirational segment under which that they would be buying a high-end four-wheeler. If you look at the people who are buying two-wheeler, it's people who can't, where affordability. No, it's not normal. People use four-wheeler, majority of the people. I'm not talking about the high-end BMW seven series and so on. Yes. I'm talking about the common man. People like him. He will be using a car. He will also use a two-wheeler. His wife also will use a two-wheeler. You know, one of the questions I was asked when Nano Nano was going to be launched, "What will happen to the two-wheeler?" I said, "If Nano is successful, two-wheeler will double." Because customers, those set of customers will buy a car to use it for the weekend with the family. Regular days they will use only a two-wheeler. Easier Easier, total cost of ownership. Mm-hmm. This is a major investment in their life. Mm-hmm. This car is a major investment in their life. They will keep it for very, very Mm-hmm Important usage with the family. Basically what you are saying is that even that segment where they can afford, they will still buy a two-wheeler. Have you visited Indonesia? Yes. Okay? When we went initially, I was shocked. Indonesia, people have small houses, maybe one-third of this size. Houses. INR 3 crore Men use, women use. Yeah. You know what they do? Because I stayed with them to understand. They keep the bike and the Scooty inside the house and lock it, and they will sleep outside. Not joking. Please, please visit. Especially people from Singapore and Thailand, please visit. Okay? Whenever they are giving it for service, in here, that way better. They will be sitting near the mechanic and looking at the bike. Applied leave to his job that day, half a day. Mm-hmm. Because in his life, this is the most precious thing. Not even his wife. Sorry. He or she tells that this is the most important investment in their life. It cannot be stolen. Nobody, a mechanic cannot remove any part. I want to see what they are doing. India may not be so much attachment to the two-wheeler, but some rural, it's so much attached. You know, they give so much importance for a two-wheeler in their life. It's a very important investment in somebody's life. Majority people, even you buy a two-wheeler, they still want your two-wheeler with style. With something new, precious or proud of. Repeat. The ones who wanna buy two-wheeler, they want a one which is stylish or has more features. Something new. Something new. For example, moped. There was a discussion inside the company, "Should we give the EFI technology or we can give the carburetor technology?" EFI technology gives the best in class fuel efficiency and total cost of ownership. This was the bike where we put the ISG first. Integrated Starter Generator. It gives a lot of consumer convenience, fuel efficiency. This guy gets very small money. We said to a moped customer, we should improve his productivity. No kicking, no kick-start. Only electric start. Okay. That his main problem. We looked at what are the pain points of the customer, what is the total cost of ownership, and then we decided the technology to be used in the moped. I'm taking moped as an example. Many a times, please don't only focus on the premium customer who's willing to pay. Look at every customer and say, "What is it he values?" Give that to him. Sir, on EVs, you mentioned lot of learning curve is happening on product make or buy decision. In terms of markets, will India be the main market or in Southeast Asia in the next three-five years? We can deliver these products. For example, the same equipment can be sold both in all export markets and even the developed markets. But- As of today, the constraint is any market you enter, you have to fulfill the volume. Okay. We started with Bangalore, then we expanded. We went to 33 cities. Now we are in 88. Already booking is more than 25,000. I don't want to book because till booking, everybody will be a gentleman. The moment you take some money from him, then he will say, "No, I'm booked. Why you are delaying me?" Okay. While every semiconductor company is trying to improve, it is still not up to the level what we want. We want immediately 10,000 to be delivered. You know, two-three months of 10,000 or 15,000, then we may enter into one or two markets. You are right. Absolutely right. There is a great opportunity. We may have to have certain modifications on certain parts based on the learning. I won't say that the same, but predominantly the same platform will be used in these markets. In any of these markets, you are seeing some adoption, in Southeast Asia or anywhere? I think there are. For example, every market is going through the journey what India is going through. Every market is talking about EV. For example, Indonesia, I know some people are also testing. Indonesia, we are there. Mm-hmm. Our dealerships are there, but I don't have today the delivery capability. Mm-hmm. It will happen. Yes. Okay. Sticking with EVs, sir, how do you think about the viability? Because there's a lot of companies are losing a lot of money on EVs, especially the startups. How you look at it as a philosophy and as EV ramps up? To me, it is similar to what we did in previous credit services or in PT TVS. Indonesia. PT TVS, when we invested about eight-nine years back, we have to come up with completely new set of products. Neo, Rockz, Dazz, none of them sold in India. Scuba and the rest, yeah. Scuba and the rest. We design, develop. We have a full-time team. In Indonesia, we have a plant there. May not be so big, but smaller size plant. We have a paint shop. There are basic things we don't compromise on quality. Customer is important for us, so we treat it as an investment. We had some challenges, you know, because 98% Japanese and almost 95% is retail finance. The retail finance terms are dependent on the volume, whether it is the initial, you know, then the EMI, the interest. Exactly like India. We had some challenges, but we stayed back. The good news is we stayed back and said, "Customers like our product, but there are challenges." No competition is going to easily allow us to succeed. Today we are profitable. Now we are entering to see the multiplier effect. More and more people is looking at our brand. More and more countries want it. Same thing will happen here also. Mm-hmm. The good news is from negative margin, we have gone to positive. On the cost, bill of material. It will have a fee. Like I said, customer, once he accepts, the demand is assured, then the top line is assured. Yeah. When the top line comes. Scale Dealers are happy, sub-dealers are happy, suppliers are happy. Everybody wants participate. All right? Volume gives you the luxury of- Competition Looking at the total cost. We struggle with EV break-even. Now we are talking about EV. EV bill of material, then break-even. No, it is positive now. Positive now. Sorry. Of course, the subsidy benefits are included in that. That's. Subsidy is not a bad word, Yash. Yeah, I know. When India started exporting, every country had sought some support from the government. We started off with 14%-15% export benefit. Today it's 1.5%. How much? 1.5%? Yeah. Your exports are still very profitable. Yeah. So- There is a learning curve. In any business, there is a learning curve. In the learning curve, you focus on the customer, you focus on the quality. Never make shortcuts. Yeah. I have to somehow sell some numbers. That is not the intention. You have to be sustainably looking at quarter- after- quarter and build brand, brand. Come with a lot of products. Put the right infrastructure. Partner with companies. For example, in the EV space, we have partnership with Tata. We have now Jio. We have to look at who are all the future people who are going to. We don't know which is going to be. As of now, customers are using home charging. Mm-hmm. Okay? Fast charging is possible now. Mm-hmm. Along with the new iQube. I think most importantly, you keep yourself, my view, focused on the customer usage and agile and see how things are shaping. Do you think absolute EBITDA per unit for EV would be higher than for ICE? No better. In the long term. I It's hard to say. No. I look at these as investments for future. Mm-hmm. Okay? This question is like left eye is important or right eye is important. For me, both eyes are important. Mm-hmm. No, just, yeah, from standpoint, like when you described an EV as a smartphone on wheels, if we were to compare margins at smartphone. Learning curve. I can also counter-argue saying that today I don't export to many of the developed markets. Mm-hmm. Okay? Developed markets, you get better price for the same product. Mm-hmm. I will make more margin, but I am not in the margin game. Mm-hmm. Not in the margin. Margin will come here. Focus on the customer, focus on the technology, giving the best to the customers. Top line will come, and the top line is where every line will come from. It's not a, you know, kind of a. You are asking ICE versus EV. Correct. Also it is like two-stroke to four-stroke, now to EV. Tomorrow, somebody will come up with hydrogen, somebody will come up with new technology. I think it is evolution. Mm-hmm. Okay? We should not look at which technology is going to give you more and more profit. Nobody knows. Yeah. Okay? You focus on the volume, because business is driven by volume. How much- Costs are dependent on the volume. Mm-hmm. Okay? How much is localization in EVs right now, and what kind of percentage localization you are looking by when? See, as of now, everybody are looking at getting from the cells coming most of them. All of you know there are many factories that are going to be placed in India. Correct. Possibly it may take three years, four years. Right? Maybe you start with import initially on cell. That's the not so critical, okay? That's why I put cell. Right? Many people who are working on the semiconductor side. Mm-hmm. Semiconductor side. Start with cell life importing, but over a period of maybe three years, four years, many things will be completely in India. The in-house investments to succeed or Indian investments, volume is needed. Volume is needed, customers have to accept your product. That's why it comes back to customer acceptance. The customer acceptance is there, any technology will not work. In terms of EVs, like, you know, you were mentioning that. Sorry. Yeah. Continue. No. I was saying that, you know, in a big change like this which is happening in terms of the entire industry getting, you know, let's say getting a big churn as such, how do you think about, you know, customer education where you say, you know, they're going to buy whatever is going to be sold to them, right? What car you buy? Sorry? What car you use? I have a Honda Brio. Have you seen the manual? No. I can tell you, if I ask 100 of my iQube customers, how many of them have read? Mm-hmm. You will get one freak incident of one tech guy. I have gone through, sir. 99. Correct. Correct. They'll ask how to switch on, how to charge. Please understand, customer is not so complicated. Correct. No, no. He's not. I'm answering you. They have a purpose. Mm-hmm. Okay? When you bought the car or when I bought the car, let me tell you, I have a. What is it? Kia. Carnival. Carnival. Okay? I just took a test drive. I liked it. I bought it. Okay? On the EQC, electric. Oh, very good. I tried Honda. Mm-hmm. I asked them, "Hey, tell me, which are the switches?" That's all. After that, convenience, ride, that's all. Mm-hmm. Customer's mind is not so complicated. In my view, customers are completely agnostic about the technology, okay? Within the boardroom, we bring a lot of theoretical discussions like, "No, what the customer..." You know, how many times we have read the manual of this? Honestly, I'll tell you as a person, I don't know what technologies are there, what features are there. Mm-hmm. This is customer behavior. Many a times there may be a set of customers who are very techie. That you have to deal with separately. For example, if you are dealing with your RR 310, ride modes, et cetera, et cetera. I've seen my dealers sometimes have a lot of problem. The customer knows more. Customer knows more. Mm-hmm. You have to look at which are the models, which are the customers who are free with the technology and the feature, such you have to deal separately. Mm-hmm. Their proportion is very small. Mm-hmm. Very, very small. The other day I asked 100 iQube customers. I was shocked. Nobody said, "I use this, I use that." They said, "Brilliant. I charge it at home, and I feel very happy. This is noiseless." The terminologies what they use is, "No, no noise. Very convenient." Okay? "Very smooth. Mm-hmm. I can take my entire family like my Jupiter. Mm-hmm. That's all. The question, sir, was then, you know, whoever reaches the customer first is going to be able to sell it to him, right? If the customer is not discerning enough to, you know, kind of know the difference between, let's say, something brought from China versus something developed in India, which is so, you know, kind of. I agree with you. That's why you are seeing the low speed and the other speed is moving very fast now. Mm-hmm. The moment he will start, I think you can tell him the numbers what some of my competition highlighted. Why he does not sell it? Try to go to their online this one. They will give you so many numbers. You know? I normally don't talk about partnerships. Not easy. Customer knows if there is a problem, they won't use it. Early morning, if you have a two-wheeler, you know, getting up between 6:00 A.M.- 6:15 A.M. I may even stretch it to 6:15 A.M. because I know my two-wheeler is there. You go there and start, it doesn't start. One day is okay. Second day is okay. Third day, what will be your behavior? You will sell that. They will completely get upset. We have to look at the customer behavior. The owner, a customer, he wants flexibility of his mobility. Whenever I want, I should be able to go from place A to place B. Downtime. If you ask my HLX customer in Nigeria, he rides 200 km every day. Five people sitting behind him. He's from He's from Nigeria. Okay. He doesn't want even 10 minutes break. Mm. I've never seen people riding 200 km, 12-13 hours every day, because that is the money they earn. Mm. Depending upon the customer segment, we need to understand, did you deliver that volume? Even Chinese will succeed here. I'm not saying I'm not against anybody. Anybody who gives customer- Mm. 2 important things I tell. This is the most important investment in customer's life. Mm. Mm. Okay? Most important. If I put INR 60,000, INR 70,000, INR 80,000 rupees. Mm. It's my earning of the life. If that thing doesn't start or doesn't work whenever I want, I get pissed off. Completely pissed off. Mm. As you know, the bad word of mouth travels much faster than the good word of mouth. Nobody will say, "I had a good bike." Nobody will say. In a way, nine people, if I have some problem, I'll tell my friend, "Hey, don't buy this, okay?" But if I have good bike, I won't say, "Please buy this." This food is made by our canteen for our staff, okay? It's very good, thank you. Yeah. They have tried and attempted many things. Yeah. We do a variety of South Indian, North Indian or only vegetarian. Oh, tasty. Oh, very. We give only vegetarian here. Sir, in this increasing dealership, are we looking at new dealers as well, or are we giving more old TVS guys bikes in? It is not old or new. Performing dealers. How do I evaluate performance is based on one side we look at the service care. On one side I look at the sales care and how they treat the customer. Mm. We have a competency score. Those dealers who are very pro-customer, customer-friendly, such dealers we will continue. Okay? Here, honestly, I don't know how it is going to pan out the distribution. Namely, there are set of customers who completely believes in online. My hypothesis is unlike a TV or a PC or a consumer durable, this is a moving vehicle, no? A moving vehicle will have wear and tear. It requires some kind of a service. But there is no engine. Right now it could be a hybrid structure. It is the early stage. I can't really tell you how it is going to. Many things are going to be OTA. With so much of software and whatever you can do in this can be done in the two-wheeler. Mm. It's at this point of time, every structure possible. Maybe there will be some difference in urban and rural and semi-urban. Mm-hmm. Okay? Lot of learning curve will come. when you look at all this, because you have now come to the output part because you shared a lot about the input and all the process, but how do you- I share with the profitability also. Be patient. Have you seen twenty twenty cricket? I think most of us were at that time. You may not have seen. India did play cricket. Yeah. Oh. India played 50 overs. Mm. I get to get here. Yeah. This test match. Yeah. 50 days, 50 overs. Now it is 20 hours because people becoming rusty. Yeah. They don't want to spend the whole day. Mm. One principle we made. Okay? Good bowling, fast bowling in very difficult pitch. I always tell the people, be calm and stay. Respect good ball. If you stay calm, you will get an opportunity to hit your sixes. Okay? Stay calm. No. To me, it is nothing different to a TVS Credit Services or a VTV. No, it is different. Process is same. Process is same. Build the top line, scale the customer. Focus on the customer. Build scale. Build scale. It will come. Prices will come down. Which customer segment do you think you are less well-penetrated into and you want to focus on expanding your share in? I would be involved, no? We were not there in 125 cc Raider. We have come up now. Mm. We were not having 125 defector. We have come now. If you ask me. Mm. Lifestyle segment. We were never there. Mm. We have to match between size of the customer segment, our capability, and then decide what kind of product. This is one area we continuously work on. Mm. Possibly in the EV side, maybe we will start with scooters. My hypothesis is that a scooter as a category is around 35% now. Mm. It will expand. It will expand. 35% will become 40%, 45%, 50%, like that. The total will increase. Because of electrification going. Yeah. Taking share away from a country level. Until a commuter motorcycle. Of course, Hero would interact with that. Don't go by TVS, AMR or Hero or anything. Customer. You decide by customer. Okay? Don't go by. Don't get influenced by AMR. You ask the people who has bought today Activa. Easier, you can do a focus group and ask, "What did you consider?" They will tell you, "I consider the scooter," or somebody will say, "I tried this motorcycle." Right? I mean, your hypothesis is that scooters are expanding to keep up with the population. How do you see the price point of that segment then if you got the? Price point we'll see. India is a country, you know, where Mm. One hypothesis I have is premiumization is going to happen. Premiumization. Premiumization. Premiumization. Very good. Okay? People want more and more features, more and more technology, especially today's young people. After I saw the Kia car, I was expecting some. Maruti. No. Maruti and all is for old people. No, no. Today's young people look at Hyundai. They look at. Kia. Kia. Whether they have affordability. See, aspiration level they want. Mm. They will put their budget. Okay? I was looking, what is that Venue or something. Hyundai Venue. She will be happy. Because no Venue- Small car. I said, "One person?" My friends are saying this, this. I want only these, these features. Ah. Today's young people, especially in urban, they are aspirationally somewhere. That's a YOLO effect. You live only once. I think some of the things the current generation of India. I agree with you. Please understand. When we were growing up, we were always looking at saving. Saving, yeah. Saving for the next generation. Investment apartment because Mm. Today's young generation. Whenever I go to Indonesia, you know, I talk to the Indian people. Saturday, Sunday, they don't want to work. Mm. I used to say, "Oh, hey, why you don't work?" "No, no, we want to have friends. We want to meet my friends." Okay? To me, it was not going in because we work. There is nothing called life. Okay. For that part, that's a strength that comes here. Like you say, in Indonesia, they are kinda lazy. They spend weekend and are happy. The Indian is hardworking and willing to work. I ignore the word lazy. I think naturally you have lazy time. Oh, okay. For example. Uh, let's- We can break now? Yeah. Kiran, excuse me. He hasn't had anything. He hasn't eaten his lunch. He's just looking at. Oh. Whoa. Really? Oh, very good. I really missed that. Some bankers have come, so I have a physical meeting, so you may have to excuse me now. Okay. Anything you wanna say, sir? Mr. Mirza? Nothing. No, I think once. Talk about the TVS, TS. Because a lot of people don't know. You should give us a brief picture of TVS Credit. I saw there was a recent update. The last one was great, but how is the business shaping? Sure, sure. TVS Credit Services is a subsidiary to TVS Motor Company. TVS Motor Company holds close to 85%, 85-86% in TVS Credit Services. As far as the book size is concerned, we have recently crossed INR 16,000 crore of book size. Very profitable, very healthy book. There are no provisions for the non-performing assets for the last four or five months continuously. The collections are better than the pre-COVID level today. In fact, earlier, TVS Credit Services used to depend on 100% business from TVS Motor Company when it was started. Now the dependency is as low as 30%. We are doing for other business, including consumer durables, trucks, used tractors, cars, everything today. We have close to more than 10,000 people on ground for collection. Though the collection cost is slightly high, but it is really helping us on the collections. There are no provisions today. That's the news. We are quite a bit cautious in deployment. Otherwise, we would have even crossed INR 17,000 crore by now. That's the reason. Otherwise, it's really doing very well. Plans of modernization still on, sir? You did talk about plans to bring an external investor for TVS Credit. Yeah. Yes, we are exploring all options. There will be a fundraise program, probably we'll let you know very soon. We are evaluating all options. Yes. The most importantly, when we started, 100% it was TVS Motor dependent. Mm-hmm. Today, the dependence has come down to 30%. 70%, elsewhere now. Mm-hmm. Any business is like that. We started with one version of iQube, now we have three versions. Three different price points. Understand. Now we will have more and more products, more and more segments. How many products you plan really across, not getting into specifics, but how many over the next, say, 18 months? It will come. You will have every segment, ultimately, you will have product, and it will be for not only for Indian market, for global market. You should eat that. It's all made for you. I'm good. I've been eating. Can I take leave please? Thank you so much, sir. Thank you, Pramod. Thank you to the entire team. Thank you so much. Thank you, sir. Thank you, Sushil. These are all made here. This is made of carrot. This is made of beet. This is local banana. Hey, Pramod, you should tell them it's not only interaction. You should eat well. Yeah, we should eat well. I mean, we've been eating a lot. Sir, if you can talk a bit about the recent DriveX investment as to how that ties up into your TVS overall and the TVS- See, I don't want to say specific investment, but I can say that there is a logic. See, we have the TVS plus ICE here. There's an option which is very, very high-end. Mm-hmm. Okay? Okay? That you have the e-bicycles. If you look at, we don't know anything about European market, but there's a great opportunity to enter into the European market. e-bicycles are growing almost 20% CAGR in this market. There is something we invested in EGO Movement and SEMG primarily to understand customer usage, channel. Okay? Options are different. You can also design, develop something and then put it to. Then you can learn. These are all strategic calls we looked at, which is the fastest way, you know, to understand the consumer behavior. It's possible to scale it up. This is an addition to the range. Okay? I think we will constantly look at the opportunities for right investments and scale it up, and then try to look at how we reach to make it profitable. The thing is, if we can understand that when we are accumulating so many small investments over a long period of time, one plus one and plus, suddenly becomes 20% of your book or something. That's the risk that we let it go. See, when we started in Indonesia, it was completely run by the Indians. Yeah. Okay? Today it is completely run by the Indonesians. Indonesians, yeah. Mm-hmm. To me, money is not the problem. HR is the problem. Mm-hmm. When you buy so many businesses, who will run it? That's the worry they have, that is your bandwidth. I answer. I used to go to Indonesia every month. Okay. Last three years, I have not gone. I sometimes say that now that I have not gone, it's profitable. Not with me. Yeah. It is run by the Indonesians. I never dreamed, you know, you will have Indonesians, you will have Europeans, you will have Africans, you will have Latin Americans, which will be running this company. Look at all TVS tech. What's the major difference between have a factory in Indonesia versus here? Because the funny thing is there are so many OEM doing like textile, apparel and things in Indonesia, but not in India. It's rare to see. Like if you are in United States, you can see a lot of T-shirt made in Bangladesh, Indonesia or even Pakistan, but rarely India. Supposedly India should be a country with cheap labor, even cheaper than them. The majority, global brand not using India as a OEM center. Yeah. Yeah. That's the thing always puzzle me. Yes.