TVS Automobile chalks out aggressive expansion plans
By IANSWednesday, February 23, 2011
CHENNAI - With the Indian car market logging good growth, this city-based automobile services company TVS Automobile Solutions Ltd is aiming to increase the number of MyTVS car garages to 523 and achieve a revenue of Rs.460 crore by 2014 through organic and inorganic expansions, a top company official said.
“Discussions are on with four parties to have a joint venture for setting up car garages in other parts of the country,” R. Dinesh, a director of the company, told reporters here Wednesday.
“Our investment may be around Rs.15 crore in these joint ventures whereas the partner will bring in land or client base,” he added.
Till recently, the Rs.33 crore-revenue TVS Automobile was a division of T.V. Sundaram Iyengar and Sons Ltd. The division was hived off into a separate company and has got Rs.79 crore funding from private equity Kitara Capital.
According to Dinesh, the company plans to increase the number of MyTVS garages to 523 by 2014 from the current 65 outlets.
He said the company will also increase the number of states it is present in to 11 by 2014 from four now.
Dinesh said the company has initial funding of Rs.120 crore (equity capital plus share premium and others) and over a period a total of Rs.500 crore worth of investment would be made in the business to take the company’s revenue to Rs.460 crore by 2014.
“TVS Automobile will commit around Rs.250 crore and the balance will come from our partners, franchisees in the form of land and other assets,” Dinesh added.
He said independent garage chains are not competitors to vehicle manufacturers but partners in progress.
“We can set up dedicated service outlets for car makers,” he added.
Queried about the investment by Kitara, he said the private equity will hold significant minority holding — anything between 20-30 percent stake — in TVS Automobile.
According to R. Srivatchan, president, the company is planning to enter countries like Thailand, Vietnam, Sri Lanka and Turkey with its 24×7 MyTVS roadside assistance.
