Value Creation Thru M&A

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A

SYNOPSIS

ON

VALUE CREATION THROUGH MERGERS ANDACQUISITIONS A CASE STUDY OF ICICI LTD. V/S ICICI

BANK

Under the supervision of: Submitted by:

Dr. Rajeev Kumar Rashmi Chhabra

Lecturer Roll No. 06061114024G.J.U.S&T, Hisar MBA (Finance)

Remarks of Evaluator

Approved/Disapproved Approved/Disapproved

(1 Evaluation) (II Evaluation)

Session:- 2006-08

Directorate of Distance Education


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G.J.U.S&T., HisarANNEXURE II

DIRECTORATE OF DISTANCE EDUCATION

GURU JAMBHESHWAR UNIVERSITY OF SCIENCE &TECHNOLOGY, HISAR

FORMAT FOR RESUME OF SUPERVISOR/GUIDE

1. NAME : .

2. DESIGNATION : .

3. QUALIFICATION : .

4. AREA OF SPECIALIZATION: ..

5. EXPERIENCE : ..6. OFFICIAL ADDRESS : .

..7. MOBILE : ..

8. E-MAIL : ..

I am willing to supervise ..

Enrollment No.

On the topic :

(Signature) with seal

Countersigned by the employer with seal

Countersigned by Director of study centre with seal


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DECLARATION

I here by declare that my project on Buying behaviour and customer satisfaction in the

selected brands of bikes (Hero Honda, Bajaj, TVS) regarding fuel efficiency, aftersales services and price in Mahender Garh submitted in partial fulfillment of

requirement for the award of degree in Master Of Business Administration is an authentic

work. This project is my original work and results are based on responses given by therespondents and the secondary sources used for this purpose and any part of this projects has

not been submitted for this purpose in any form.

SATISH KUMAR

Roll no. 0510511

MBA ( Mkt) 2003- 05GJUS & T , HISAR


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ContentsSerial No.

1. Acknowledgement

2. Executive summary

3. Introduction to automobile industry

Two wheeler industry

Invention of two wheeler

4 Consumer behavior

5 Significance of the study

6 Objective of the study

7 Literature Review

8 Research Methodology

Sampling & Sample Design

Analytical Tools

Data Collection

Hypothesis Testing

9 Limitations of the study

10 Result & Discussions/Findings

11 Recommendation

12Bibliography


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13Annexure

ACKNOWLEDGEMENT

There is always a sense of gratitude which one expresses for others for their help &

supervision in achieving the goals. I too express my deep gratitude to each &

everyone who has been helpful in completing the dissertation report successfully.

I express my sincere gratitude toDr. Vinod kumar Bisnoi, without whose

guidance, keen interest and regular encouragement my project would not

have been compiled. I would also like to grab the opportunity to thank my

other teachers and friends for there helping hand in the compilation of the

report.

Last but not the least I would like to thank all those to whom I met and get

any information regarding my project.

Satish yadav

Roll no. 0510511


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Executive Summary


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Executive Summary:

To know about the consumer buying behavior and factor which affect the consumer

buying decision process. As the objectives of my study is to analyze the customer

perception and the customer satisfaction to wards specific brands of bike (TVS,

HERO HONDA, BAJAJ) on the basis of Price, Fuel efficiency, Brand, Style and

brand name.

Consumer buyer behavior refers to the buying behavior of final consumers

individuals and households who buys services and goods for personal consumption.

Consumer behavior is influenced strongly by culture, social, personal and

psychological factors. Culture factors include the set of basic values, perceptions,

wants and behavior learned by a member of society from family and other important

institutions. The social factors include consumers family, small group, social roles

and status. The personal characteristics such as buyers age, life cycle stage,

occupation, economic situations and life style influenced by four major

psychological factors: Motivation, Perception, Learning, Belief and Attitudes.

In this era of cut throat competition, no company can even survive in the

market place without knowing its and its products strengths and weaknesses. It has

to fortify itself against threats from the environment and exploit its strengths or

increase profits. And in order to do so, the company has to conduct regular surveys

to know the customers opinions, needs, and preferences. This helps the company to

manufacture the product like wise for each customers expectations.


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INTRODUCTION TOAUTOMOBILE SECTOR


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INTRODUCTION TO AUTOMOBILE SECTOR:-

The automotive sector comprises the Original Equipment Manufacturers (OEMs)

and auto component manufacturers. Globally, the automotive industry is recognisedas a key component and driver of national economy. The global automotive industry

is in the midst of a major structural transformation

Among OEMs, global conglomerates are emerging, driven by mergers and alliances

among manufacturers

Component manufacturers, or suppliers, are getting Tirades, with Tier 1 suppliers

taking on the role of component aggregation and and module supply/assembly, and

component suppliers being relegated to Tiers 2 or 3.

Relationships between OEMs and suppliers (especially Tier 1s) are becoming

increasingly collaborative.

These trends have affected the Indian auto industry as well, leading to a rapid

transformation of the industry over the last decade or so. After the end of licensing

in 1993, the industry has witnessed rapid growth in volumes and capacity, and 17

new ventures have come up in the last 10 years. These include global giants such as

General Motors, Ford, Toyota, Honda, Hyundai and Fiat. The industry encompasses

commercial vehicles, multi-utility vehicles, passenger cars, two wheelers, threewheelers and auto components.

The domestic automobile market has been growing at 14.2 per cent CAGR over the

past 4 years (2000-01 to 2004-05), while the auto components market has been

growing at 19.2 per cent CAGR (2000-01 to 2003-04). The industry (OEMs and

suppliers together) contributed nearly 4 per cent to the countrys GDP in 2003-04.

The automotive sector also offers significant employment opportunities. It employs

0.45 million people directly and around 10 million people indirectly.

The industrys capabilities in design, engineering and manufacturing have beenrecognized the world over, and most automotive majors are looking to increasingly

source auto components from India.

India is emerging as one of the most attractive automotive markets in the world, and

is poised to become a key sourcing base for auto components.


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Indian Automobile Industry :

Largest three wheeler market in the world

2nd largest two wheeler market in the world

4th largest passenger vehicle market in Asia

4th largest tractor market in the world

5th largest commercial vehicle market in the world

The industry structure spans all segments and is concentrated in regional clusters

The India automotive sector has a presence across all vehicle segments and keycomponents. In terms of volume, two wheelers dominate the sector, with nearly 80

per cent share, followed by passenger vehicles with 13 per cent. The industry had

few players and was protected from global competition till the 1990s. After

government lifted licensing in 1993, 17 new ventures have come up. At present,

there are 12 manufacturers of passenger cars, 5 manufacturers of multi utility

vehicles (MUVs), 9 manufacturers of commercial vehicles, 12 of two wheelers and 4

of three wheelers, besides 5 manufacturers of engines. With the arrival of global

players, the sector has become highly competitive.

Pune in the west, the National Capital Region (NCR, which includes New Delhi andits suburban districts) in the north, Jamshedpur and Kolkata in the east and

Pithampur in the central region.

Following global trends, the Indian automotive sector also has most auto suppliers

located close to the manufacturing locations of OEMs, forming regional automotive

clusters. Broadly, the three main clusters are centered around Chennai, Pune and the

NCR.

The Indian automotive component industry is highly fragmented. There-are nearly

6,400 players in the sector, of which only about 6 per cent are organized and the

remaining 94 per cent are small-scale, unorganized players. In terms of value added,

however, the organized players account for nearly 77 per cent of the output in the

sector.

The sector manufactures components across all key vehicle systems. The break-up

of the output from the organized sector, in value terms, across key vehicle systems.


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The automotive sector is growing strongly in both domestic and exports markets

Indian automobile industry has been performing well both in the domestic and the

international markets.

Automobiles - Domestic Performance:

The production and domestic sales of the automobiles in India have been growing

strongly. While production increased from 4.8 million units in 2000-1 to 8.5 million

units in 2004-05 (a CAGR of over 15 per cent), domestic sales during the same

period have gone up from 4.6 million to 7.9 million units (CAGR 14.2 per cent).

CAGR of last 4 years for different segments 23.5

Commercial Passenger Two Three total Vehicles Vehicles wheelers wheelers

Automobiles

Segments:

A positive trend in the domestic market is that the growth has not been driven by one

or two segments, but is consistent across all key segments. Two wheelers, which

constitute the majority of the industry volume, have been growing at a rate of 14.3

per cent, three wheelers at a rate of 14 per cent and passenger vehicles at a rate of

11.3 per cent. Commercial vehicles have been growing at a higher rate of nearly 23.5per cent, although from a lower base.

Since nearly all macro-economic indicators GDP, infrastructure, population

demographics, interest rates, etc. are showing a favourable trend, the domestic

market for automobiles in India is expected to continue on its growth trajectory.


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Introduction

of Two wheelers


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Two wheelers:

The production of two wheelers in India increased from 3.76 million vehicles in

2001 to 6.53 million vehicles in 2005.

Invention of Two Wheelers:

The invention of the first two-wheeler is a much debated issue. "Who invented the

first motorcycle?" may seem like a simple question, but the answer is quite

complicated.

Two-wheelers owe their descent to the "safety" bicycle, i.e., bicycles with front and

rear wheels of the same size, with a pedal crank mechanism to drive the rear wheel.

Those bicycles, in turn descended from high-wheel bicycles. The high-wheelers

descended from an early type of pushbike, without pedals, propelled by the rider's

feet pushing against the ground. These appeared around 1800, used iron-banded

wagon wheels, and were called "bone-crushers," both for their jarring ride, and theirtendency to toss their riders.

Gottlieb Daimler (who later teamed up with Karl Benz to form the Daimler-Benz

Corporation) is credited with building the first motorcycle in 1885, one wheel in the

front and one in the back, although it had a smaller spring-loaded outrigger wheel on

each side. It was constructed mostly of wood, the wheels were of the iron-banded


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wooden-spoked wagon-type, it definitely had a "bone-crusher" chassis!

This two-wheeler was powered by a single-cylinder Otto-cycle engine, and may

have had a spray-type carburetor. (Wilhelm Maybach, Daimler's assistant, was

working on the invention of the spray carburetor at the time). If two wheels with

steam propulsion can be called a motorcycle, then the first one may have been

American.

One such machine was demonstrated at fairs and circuses in the eastern US in 1867.

This was built by one Sylvester Howard Roper of Roxbury, Massachusetts. There is

an existing example of a Roper machine, dated 1869. A charcoal-fired two-cylinder

engine, whose connecting rods directly drive a crank on the rear wheel, powers it.

This machine predates the invention of the safety bicycle by many years, so its

chassis is also based on the "bone-crusher" bike.

Origin of Motor-Scooters:

Edward Butler, an Englishman, built the first motor tricycle in 1884. The first

gasoline-engine motorcycle to appear publicly was built by Gottlieb Daimler, of Bad

Cannstatt, Germany, in 1885. The first practical engines and motorcycles were

designed by the French and Belgians, followed by British, German, Italian, and

American makers.

The popularity of the vehicle grew, especially after 1910. During World War I the

motorcycle was used by all branches of the armed forces in Europe, principally for

dispatching. After the war it enjoyed a sport vogue until the Great Depression began

in 1929. After World War II a revival of interest in motorcycles lasted into the late

20th century, with the vehicle being used for high-speed touring and sport

competitions.

The practice of attaching auxiliary engines to bicycles in western Europe and parts

of the United States led to the development during the 1950s of a new type of light

motorcycle, the moped. Originating in Germany as a 50-cubic-centimetre machine

with simple controls and low initial cost, it was largely free of licensing andinsurance regulations except in Great Britain.

The more sophisticated motor scooter originated in Italy soon after World War II,

led by manufacture of a 125-cubic-centimetre model. Despite strong competition

from West Germany, France, Austria, and Britain, the Italian scooters maintained

the lead in the diminishing market. The scooter has small wheels from 20 to 36 cm


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(8 to 14 inches) in diameter, and the rider sits inside the frame. Power units are

placed low and close to the rear wheel, which is driven by bevel gearing or chain.

Capacities vary from 50 to 225 cubic cm, and four-speed gearing is common.

MOTORCYCLES IN INDIA:

In 1955, the Indian government needed sturdy and reliable motorcycles for its Army

and police to patrol the rugged border highways. The first batch of 350cc Bullet

from the Royal Enfield Company of UK were received and assembled at Chennai.

The four stroke engine of the motorcycles is fuel efficient and is the main reason for

the growth of motorcycle segment In India. The motorcycle market share is about

81.5% of the total two wheeler market in India. Three-fourths of the total exports inthe two wheeler automobile industry are made in the motorcycle segment. Exports

are made mainly to South East Asian and SAARC nations.

The domestic sales have been increasing at a CAGR of 14.3 per cent for the past 4

years. Motorcycles constituted 79.5 per cent of the domestic sales of two wheelers in

India and have been growing at nearly 24 per cent CAGR. In the scooter segment,

overall domestic sales grew by 1.3 per cent CAGR, driven primarily by ungeared

scooters and scooters with automatic gears. The sales of mopeds have declined at a

CAGR of 15.9 per cent for the past four years. The motorcycle segment clearly

drives the growth of the two wheeler segment in India.

The two wheeler segment is being shaped by changing demographics and lifestyles.

An increasing number of working women and greater affluence among college goers

have led to an increase in demand for ungeared/auto geared scooters. As with the

case of passenger vehicles, there is a rising demand for higher-end models that

combine style and performance in this segment as well. In motorcycles, for example,

models with higher engine capacities (125cc, 150cc or above) are proving very

popular.


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Most of the production is consumed in domestic market, a very little part of the

production uses for the exporting.

TWO WHEELERS DOMESTIC SALES TREND

Category 2001-02 2002-03 2003-04 2004-05 2005-06

Scooters 908268 825648 886295 922428 908159

Motorcycles 2887194 3647493 4170445 4964753 5815417

Mopeds 408263 338985 307509 322584 332741

Grand Total 4203725 4812126 5364249 6209765 7056317


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Export of two wheelers from our country:

TWO WHEELERS EXPORTS TREND

Category 2001-02 2002-03 2003-04 2004-05 2005-06

Scooters 28332 32566 53687 60699 83873

Motorcycles 56880 123725 187287 277123 386202

Mopeds 18971 23391 24078 28585 43181

Grand Total 104183 179682 265052 366407 513256

Persistence & Customer Orientation Keeps Two Wheeler market In India growing

18 % this year...

The two-wheeler automobile industry is continuously striving for synergy between

technology and systems to provide products and services that meet the quality,performance and price aspirations of the Indian buyers. They stress on maintaining

the optimum level of standards of ethics and social responsibilities, constantly

innovate products and processes, developing teams that keep the momentum going

to take the industry and its counterparts to heights of excellence in times to come.

The constantly rising Indian economy has enabled more and more buyers in the


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years to come, would be able to afford a two-wheeler. The intrusion of foreign and

merchant bankers have endorsed easy loans for both the consumers and the

entrepreneurs.

As a substantially large number of customer add to the family of two-wheeler

owners club, the demand for a more fuel-efficient, ride comfortable and look wise

appealing two-wheeler is on rise. Moreover the increasingly growing demand for

after sales support and better services has compelled the manufacturers to focus and

invest more on Research & Development, Customer reach and satisfaction.

The presence of 5 strong players with infrastructure and R&D support even form

overseas has almost restricted the entry of any new player in the segment, lest alone

the manufacturers zone, the new comer is not even capable of entering the spare part

or service support sector.

Japanese two-wheeler giant Yamaha Motor Indias new CEO and managing director

T Ishikawa recently speaking at Auto Expo Asia 2006 at New Delhi, announced

We plan to invest around Rs 300 Crores by 2008 on product development and

expansion in India. We have plans to add 3 new models in 2006.

Hero Honda Motors continues to retain the World No. 1 title by selling a record

number of motorcycles in the calendar year 2005. They sold over 29-lakh

motorcycles in 2005. A growth of 123% since 2001. This was an Average Annual

Growth Rate of 24.6 %.

A research report named, Indian Automobile Industry: An Analysis (2005-2010)

claims that in the Indian Automobiles Segment, Two-wheeler sales crossed a

significant landmark of 6mn units in the last fiscal. Total two-wheeler sales, driven

by motorcycles, grew 15.75% to 6,208,860 units in 2004-05. Likewise production

also grew by 16% Year On Year. Two-wheeler sales are projected to grow 18% to

around 7.7 million units for FY06.

The report also claims that during the FY06 and further until 2009, the CAGR

(Cumulative Annual Growth Rate), for Scooters is expected to be around 2.65%, the

same for Motorcycles and Mopeds is expected to reach 11.75% and 6.5%respectively.

The auto industry, for instance, should touch 1 million vehicles a year by2005/06 according to SIAM (Society of Indian Automotive Manufacturers). Andby 2011/12 the production of motorcycles should climb to over 10 million fromthe current 3.2 million today.
http://www.rncos.com/Report/IM028.htmhttp://www.rncos.com/Report/IM028.htm


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BIG PLAYERS IN THE BIKE SEGMENT

Hero Honda:

HHML recorded lower numbers than expected during May 2005. The bike sales

grew 6.5% yoy to 226,072 units, lower than BAL and TVS growth for the same

period. On a mom basis, HHMLs motorcycle sales declined by 4%. Exports

witnessed encouraging growth of 94.9% yoy, whereas domestic market sales grew

by 4.6% yoy. Cannibalization of sales in favor of the 125cc Super Splendor will

help the company earn higher margins and better realizations. Further, launch of

Super Passion in the near future will help gain presence in the executive segment.

However, given the competitive pressures and low numbers for the month, we

recommend investors to avoid the counter for now.

BALs volume performance in May 2005 outperformed industry growth, helped by

three brands, CT-100, Discover and Pulsar. Motorcycle sales grew by 75.6%

yoy and 11.7% mom to 153,975 units.

The declining trend in other two-wheeler sales continued with 34.2% yoy degrowth

during the month.

However, sales of ungeared scooters grew by 48.6% yoy to 3,203 units. Pulsar

model recorded a 36.7% yoy growth during the month.

Three-wheeler sales, where the company enjoys high margins, continued to remain

slack. Volumes declined by 1.8% yoy and 8.9% mom to 15,892 units. The stock has

been one of the highest gainers in the auto space in the last month. Although,

volume numbers are encouraging, higher CT-100 sales, which earn lower margins

and due to slowdown in three-wheeler sales, we rate the stock as market performer.


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BAJAJ AUTO:

A meeting of the Board of Directors of Bajaj Auto Limited was held today to

consider and approve the results for the third quarter of 2006-07 and the nine months

ended31st December 200

.HIGHLIGHTS OF Q3:

Motorcycle Sales 28% - more than double the industry growth of 13%.

Market share 34% - Increase of 3% over 2005-06.

3-Wheeler Sales 49% .

Exports (Nos.) 80%.

Turnover Rs. 27 billion 30% .

Operating EBITDA margin 14.2 %.

Gross Profit Rs. 5.2 billion 13% .

Profit after tax Rs. 3.4 billion - 23%

Motorcycles

(a) Bajaj Autos market share has further improved and stands at 34% as of 31 t

December 2006.

(b) Motorcycle sales continue to outgrow the industry. In Q3/2006-07, Bajaj

registered growth of 28% v/s industry growth of 13%. During the quarter,


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Bajaj Auto has garnered 65% of the incremental industry growth.

(c) The Bajaj Platina has recorded sale of over 500,000 units within 8 months of its

launch in April 2006. Bajaj Autos leadership in the price segment of the

motorcycle market continues with a share of 45%.

(d) The Bajaj Discovers crossed cumulative sales of ONE MILLION in

November 2006. The share in the value segment has steadily increased from

16% in 2005-06 to 21% as of 31st,December 2006.

(e) The new upgrades of Bajaj Pulsar DTS-i twins were introduced in

December 2006. Both the products have been well received and have raised the

bar in the premium segment. Bajaj Auto will shortly launch the all-new

Pulsar 220 DTS-Fi, which will further consolidate Bajaj Autos dominance in the

Segment.

(f) The company continues its focus on higher end motorcycles. Spearheading the

initiative, three new motorcycles will be launched in next few months.

(g) Motorcycle capacity is being expanded to 300,000 per month from April 2007 in

anticipation of the growing demand.

(h) The Companys efforts in new product development have been recognized.

Bajaj Auto has received:

Bajaj Auto Bikemaker of the year Overdrive Awards 2007

Bajaj Auto Bike Manufacturer of the year NDTV Profit - Bike India Awards,2007

Bajaj Pulsar DTS-Fi Bike of the year CNBC-TV18 Autocar Auto

Awards


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Bajaj Platina 100cc Bike of the year NDTV Profit - Bike India Awards,2007

3-Wheelers

(a) In the Passenger segment, Bajaj Auto has recorded a growth of 53% during

Q3/2006-07.

(b) The company continues to dominate the 3-wheeler passenger segment with a

market share of 78%.

(c) In the Cargo segment, the company has achieved a market share of 28% during

9 Months/2006-07. To further consolidate its position in the segment, the

company has recently launched an upgrade of the GC 1000.

(d) 3-wheeler passenger carriers have received overwhelming response in export

market. Over 55% of Bajaj Autos 3-wheeler passenger carriers were exported

during Q3/2006-07.

(a) Exports continue their strong growth - 80% in Q3/2006-07.

(b) Exports (Nos.) now constitute 17% of total sales significant growth as

compared to just 3% five years back.

(c) Bajaj Auto continues to be the countrys #1 Exporter of 2 & 3-wheelers.

(d) This quarter has witnessed the commencement of the new export initiatives of

the company.

PT. Bajaj Auto Indonesia, a majority owned subsidiary of Bajaj Auto, has

commenced operations during the quarter. The Pulsar 180 DTSi was

launched successfully in November 2006 at the Jakarta Motor Show. The

company is currently focusing on network development, sales and after sales


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services and brand building.

Despatches to Iran have started.

As Nigeria sales grow, the company continues to expand its sales & service

network in the country.

These new markets should generate significant volumes in next year.


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TVS recorded a 47.3% yoy and 20.4% mom growth in volumes at 63,585 units

during May 2005.

However, bulk of this growth was on account of Star, its entry-level motorcycle.

This is low margin earning brand for the company, leading to low earnings growth.

Scooterette sales grew by 18.1% yoy to20,454 units and moped sales grew by 12.2%

yoy to 22,875 units. Export performance was healthy,recording a 59% yoy growthduring the month.

Uncertainty about sustainability of market share given the competitive scenario and

disappointing operational performance during Q4 FY05, we recommend a sell at

these levels

TVS Motors:

Star is yet to shine, is Victor(y) out of reach?

TVS Motors has been a laggard as regards FY05 was concerned and has

disappointed a great deal of its supporters. Overall sales for the year grew just under

2% to 1.16 million, while the motorcycle sales ended the year 4% lower to 6.8 lakh

bikes.

Second half of FY05 was however much better, assisted by the launch of Star 100

cc. Scooter sales were up 19% for the year, aided by strong growth in sales of

Scooty model and managed to control some on the damage done by faltering bike

sales. For the year, the companys market share in the two wheelers has fallen bynearly 270 bps to 18.7%


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Consumer behavior


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CONSUMER BEHAVIOUR :

Before getting into details of Consumer Behaviour, one must go through certain

basic terminologies. In general terms both Consumer and Customer are

considered the same but they are quite different.

The term Customer is some what different from the term consumer. The term

customer is used to refer to someone who purchases goods and services from a

particular store or company. Thus a customer is defined in terms of a specific term

while a consumer is not

Consumer may be referred to any one engaged in evaluating, acquiring, using or

disposing of goods and services which he expects will satisfy his needs. So

ultimately Consumers are that individual who consumes or uses a product, which

may or may not be purchased by him.

So after getting into these terms we need to get into the details of Consumer

Behavior.

Consumer Behaviour Consumer behavior refers to how a consumer behaves or

acts or reacts in making a purchase of goods and services of his choice in different

situations

The term consumer Behaviour can be defined as, The behaviour that consumers

display in searching for purchasing, using, evaluating and disposing of products,

services and ideas which they expect will satisfy their needs.

- Leon G. Schiffman and Leslie Lazar Kanuk.

The study of consumer behaviour not only focuses on how and why consumers

make buying decisions, but also focuses on the uses which consumers make of the


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goods they buy and their evaluation of these goods after use. If the goods after use

dont satisfy the consumers, they my feel dissatisfied perhaps because post- purchase

services are not up to their satisfaction, and thus, this may influence their purchase

of the goods and it may also influence the buying decision of many others who

might come in contact with them.

The detailed study of Consumer Behaviour or Consumer Preferences focuses on-

Who Buys products or services?

How do they buy products or services?

Where do they buy them?

How often do they buy them?

When do they buy them?

Why do they buy them?

How often do they use them?

These questions will help in understanding the factors that influence the decision

making process of the consumers. The buyers decision making process includes the

following:-

1. Problem recognition

2. Information search

3. Evaluation of alternatives

4. Purchase decision

5. Post purchase behavior


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1. Problem recognition : - First and the foremost step is to identify the problem

i.e. what actually one wants with regard to the product.

2. Information Search : - Second step is to search the relevant information

regarding the Product which one wants.

3. Evaluation of alternatives : - Third step is to evaluate the collected information

i.e. analyze the information.

4. Purchase decision : - In forth step the product is actually purchased.

5. Post purchase behaviour : - In fifth step the consumer actually reacts against

the quality, quantity etc received after the purchasing the product i.e. in this

stage he reacts on the basis of his getting satisfied after the purchase of the

product.

The buyers decisions include the following:-

Product choice

Brand choice

Dealer choice

Purchase timing

Purchase amount.

Consumer perception

How do Buyers form their preference? Their preferences are influenced by

their past buying experience, friends and associates advice, and the marketers and

competitors information and promises. Though customer preference is a very


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qualitative term and it is very difficult to measure. In this study an effort has been

made to measure the customer preference level.

Customer Satisfaction

Satisfaction is a persons feelings of pleasure or disappointment resulting

from comparing a products perceived performance in relation to his or her

expectation

As the definition makes it clear, satisfaction is a function of perceived

performance and expectations. If the performance falls short of the expectations of

the customer, the customer is dissatisfied. If the performance exceeds theexpectations, the customer is highly satisfied or delighted.

Many companies are aiming for high satisfaction because customers who are

just satisfied still find it easy to switch, when a better offer comes along. Those who

are highly satisfied are much less ready to switch. High satisfaction or delight

creates an emotional affinity with the brain, not just a rational preference. The result

is high customer loyalty.

In this highly competitive world customers plays a very important role. Thus,

if a company wants to survive then it should look forward to the determinants of

customer satisfaction. Though it is a very subjective issue that differs from

individual to individual yet, identifying some basic parameters of customer

satisfaction is important.

Satisfaction is a persons feeling of pleasure and disappointment resulting

from comparing a products perceived performance in relation to his or her

expectations. It is only the customer delight that marketer aims for.


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Significance of the study :-

To know about the customer preference and decision process with regard to

bike.

To know the Basic consumer buying behaviour and the reasons because of

which they switch from one company to another.

To know about the companys details (profile, Products)

This study would help in revealing the type and specific qualities of the bikes

offered by the company to their consumers.

To study the satisfaction level of consumers who uses bikes.

To study the factors influencing consumers to buy the bike.

To study effect of advertisement on the purchasing decision of the consumers


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OBJECTIVES

OF THE STUDY


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Objectives of the study :

The clear purpose or objective of the research enables the researcher to collect

necessary relevant information. The objective of the research is to know the

Customer behaviour, preferences and customer satisfaction with regard to brands of

bikes (TVS, HERO HONDA and BAJAJ) on the basis of Price, Fuel efficiency,

Brand, Style and BRAND name.

.

Knowledge about two-wheelers (Bikes).

To know the buyers behaviour in the case of a bike or the behaviour which he

shows while purchasing a bike

To know about the leaders of the market in two wheelers (Bikes).

Find out the quantum of customer satisfaction with respect to bikes.

Determine the influence of reference group in the purchase decision of college

going students.

Find out the ways for improving of the services to attain level of customer

satisfaction

.


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LITERATURE REVIEW


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LITERATURE REVIEW :

Once the problem is formulated, the researcher has to undertake an extensive

literature survey related to problem. The literature survey undertaken here includes

books and different websites from the internet.

The research project was to know the Customer behaviour, preferences and

customer satisfaction with regard to brands of bikes (TVS, HERO HONDA and

BAJAJ) on the basis of Price, Fuel efficiency, Brand, Style and BRAND name.

Schiffman. G. Leon and kanuk lazare Leslie 1 - Study of the customer

behaviour is the study of how individuals make decisions to spend their

available resources (Time, Money and Efforts) on consumption related items.

It includes the study what they buy, whey they buy it, when they buy it, where

they buy it, how often they buy it and how often they use it. The primary

purpose for the study consumer behaviour as apart of marketing curriculum is

to understand how and how customers make their purchase decisions. There

insights enable marketers to design more effective marketing strategies.

Gupta.C .B and Dr. Nair. N.Rajan 2 - A business is based on understanding the

customer and providing the kind of products that the customer wants.

Mamoria C.B. and Mamoria Satish 3 - Consumer behaviour is the process

where by individuals decide what, when, where, how and from whom to

purchase goods and services. Buying behaviour may be viewed as an orderly

process here by individual interacts with his environment for the purpose of

making market decision on products and services.

Nair Suja. R.4 - The success of the firm will be determined by how effective it

has been in meeting the diverse customer needs and wants by treating each

customer as unique and offering products and services to suit his/her needs.


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Research methodology


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RESEARCH METHODOLGY

Research in common parlance refers to search for knowledge. It can also be defined

as a scientific and systematic search for information on a specific topic. According

to OXFORD Dictionary: Research is a careful investigation or inquiry specially

through search of new facts.

Research Methodology in a way is a written game plan for conducting research.

Research methodology may have dimensions. It includes research methods and also

considers the logic behind the methods used in the context of the study. It may also

be understood as the science of the study and minimizes the degree of uncertainty of

making wrong choices. It helps to understand assumptions underlying various

techniques and the criteria by which they can decide that certain techniques will be

applicable to certain problems and others will not.

Therefore in order to solve a research problem it is necessary to design a research

methodology for the easy and accurate solution of the problem.


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SAMPLING AND SAMPLE DESIGN

SAMPLING: Sampling can be defined as the selection of some part of an

aggregate or totality on the basis of which a judgment or inference about the

aggregate or totality is made. In other words it is the process of obtaining

information about an entire population by examining only a part of it. The process of

sampling is used for various reasons-

Sampling saves time and money. It is usually less expensive and produces

results at faster speed.

It provides more accurate information.

It enables to estimate the sampling errors and thus assists in obtaining

information concerning characteristics of population.

It also enables greater speed of collection of data.

The ultimate test of sample design is how well it represents the characteristics ofthe population it purports to represent. In measurement terms the sample must be

valid which depends upon

Accuracy It is the degree to which biasness is absent from the

sample.

Precision It represents how well the sample represents the population

in all respect.

SAMPLE DESIGN: A sample design is a definite plan for obtaining a sample from

the sampling frame. It refers to the technique or the procedure that is adopted in


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selecting the sampling units from which inferences about the population is drawn.

Sampling design is determined before the collection of the data.

Several decisions have to be taken in context to the decision about the appropriate

sample selection so that accurate data is obtained and efficient results are drawn.

Following questions have to be considered while sampling design-

What is the relevant population?

What is the parameter of interest?

What is the sampling frame?

What is the type of sample?

What sample size is needed?

How much will it cost?

Sample Size: It indicates the number of individual who would be surveyed. Here the

sample size is 150 respondents.

RESEARCH DESIGN:Marketing Managers often commission formal studies of specific problems and

opportunities. They may request a marketing survey, a product preference test, a

sales forecast by region or an advertising evaluation and so marketing research is

defined as the systematic design and collection analysis and reporting of data and


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finding relevant solution to a specific problem being faced. An effective Marketing

research involves the six steps being given as:

Define the problem and the research objective

Developing the research plan

Collecting the information

Analyzing the information

Present the findings

1.Defining the problem and the research objectives:-- Management must not define a

problem too broadly or too narrowly, a manager should describe what type of

problems is it and what the possible problem is accompanying it. Therefore, what

the marketing research team has to basically look in for to combat the problem. So

he chalks out a plan to do away with the problem.

2.Developing the research plan :-- The most efficient plan for gathering the needed

information is Designing a research plan, it calls for decision on the data

resources, and research approaches, research instruments sampling plan and contact

method.

Data Resources: The researcher can find secondary data, primary data or both.

Secondary data are data collected for another purpose and already exist somewhere.

Primary data are data gathered for a specific purpose or for a specific research

report.

Research Approaches: Primary data can be collected in five ways. These are as

follows:--

Focus Group

Observational Research

Survey Research

Behavioral Research

Personal Interviews

Research Instruments: Marketing researches have a choice of two of the main

research instrument in collecting primary data questionnaire and mechanical devices.

a) Questionnaire: It consists of a set of question presented to respondents for

their answers.

b) Mechanical Instruments: Mechanical devices are occasionally used in

marketing research.


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Sampling Plan:

a) Sampling Unit: Who is to be surveyed?

b) Sampling Size: How many people are to be surveyed?

c) Sampling procedure: How should the respondent to be chosen?

Contact Methods: Once the sampling plan is being determined, the marketing

researcher must decide how the subject should be contacted: mail, telephone,

personal or online interviews.

3. Collect the information: The data collection phase of marketing research is

generally the most important expensive and the most prone to errors.

4. Analyze the information: The next to test step in marketing research process is to

extract findings from the collected data. The researcher tabulates the data and

develops frequency distribution.

5. Presentation for findings: The researcher presents the findings to the relevant

parties and for taking major marketing decisions faced by the management.

The characteristics of good marketing research: --

Scientific Method: Effective marketing research uses the principal of the

scientific method, i.e., careful observation, formulation of hypothesis,

prediction and testing. Research Creativity: Marketing research helps develop innovative ways to

solve a problem, e.g., many companies trying to get a scoop on teem and 20+

and have found many ideas catering to the minor ability of that particular age

group.

Multiple methods: Researcher uses multiple sources which lead to better

information.

Interdependence of Methods and Data: Good marketing researcher interpreted

data from underlying data.

Value and cost of information: Good marketing researcher shows concern for

estimating the value of information from underlying data.

Ethical Marketing: Good marketing research benefits both the sponsoring

companies and its consumers.


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Research Methodology:

The research carried out in the project was descriptive in nature. The

study was aimed at describing the existing phenomenon and thereby predicts the

trend of the concept under evaluation. For that matter I consulted various magazines,

newspapers, books etc. Then I conducted the survey on schedule. On the basis of the

result of survey the final schedule being formulated for the study with the help of

various concerned persons.

Collection of Data: To collect the relevant a questionnaire was used & the data

collected was primary in nature and the method adopted was field survey and

personal interview.

Research Instrument:a) Field Survey

b) Personal Interview

Respondent Group:

a) consumers

Contact Method:

a) Personal interview from each

respondent

b) Questions were asked to fulfill the aim of the survey.


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Limitations


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LIMITATION OF THE STUDY :

Various hindrances occurred while carrying out the research. They have acted as

limitation of the study and a few of them are:-

1. Short time period: The time period for carrying out the research was short

as a result of which many facts have been left unexplored.

2. Small area for research: The area for study was Mahender garh which is

quite a small area to judge out the consumer behaviour for the various

brands of bikes.

3. Lack of resources: Lack of time and other resources as it was not possible

to conduct survey at large level.

4. Small no. of respondents: Only 150 respondents have been chosen which is

a small number, to represent whole of the population.

5. Unwillingness of respondents: While collection of the data many

consumers were unwilling to fill the questionnaire. Respondents were

having a feeling of wastage of time for them.

6. Confinement of Price: - Price of the bikes is confined only to a particular

period. So the respondents were not able to fill in proper price of their

bikes.


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RESULTS

AND DISCUSSIONS


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Table 10.1 Bike you have

Hero Honda 50Bajaj 50TVS 50

Hero Honda

34%

Bajaj

33%

TVS

33%

Hero Honda

Bajaj

TVS


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Table 10.2 Awareness about the bike available in the market

Fully aware 39Less aware 79Unaware 32

The table shows that most of the people (53%) are less aware about different

brands of bikes, only 26% people are not aware about the various brands of the

bikes.

Fully aware

26%

Less aware

53%

Unaware

21%

Fully awareLess aware

Unaware


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Table 10.3 Time period from which the respondent having

bike

Less than one year 49One year to two year 40Two year to three year 26More than three years 35

This table shows that most of the respondent(60%) are the new user of bikes. Only

23% are having it since more than three years.

Less than oneyear

33%

One year to two

year

27%

Two year to

three year

17%

More than three

years23%

Less than one year

One year to two year

Two year to three year

More than three years


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Table 10.4 Awareness about the brand came through

Through friends 56Advertisements 61Publicity 7Family members 19Any other 7

This table shows that most of the respondent(77%) came to know about that

particular brand through friends and advertisement. Other factors are less effective.

Through friends

37%

Advertisements

40%

Publicity

5%

Familymembers

13%

Any other

5%

Through friends

Advertisements

Publicity

Family members

Any other


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Table 10.5 factors influence the respondents during

purchase the bike

Brand image 19Mileage 60

Price 48After sales service 8

Any other 15

This table shows that most of the respondent (40%) are influenced by mileage

followed by 32% by price of the bikes.

Brand image

13%

Mileage

40%

Price

32%

After sales

service

5%

Any other

10%

Brand image

Mileage

Price

After sales service

Any other


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Table 10.6 reason behind preferring this model/ bike

Price - 210Mileage - 540After sales service 150

This table shows that the main reason behind purchasing particularly this model is

mileage(60%) followed by price (23%) and after sale service (17%).

Price- -

-

23%

Mileage

- --

60%

After

sales service

17%Price -

- -

Mileage -

- -

After sales

service


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Table 10.7 Type of media influences the respondents

purchase behaviour

T.V. 58Newspaper 52

Hoardings 10

Magazines 19Wall paintings 2Any other 9

This table shows that in the case of media T.V(38%) and newspaper (35%) are most

effective. Wall paper and hoardings are least effective.

38%

35%

7%

13%

1%6%

T.V.

Newspaper

Hoardings

Magazines

Wall paintings

Any other


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Table 10.8 Influencer of respondent in buying decisions of

bike

Self 61Family members 32Friends/ relatives 40Mechanics 11

Any other 6

This table shows that most of the respondents (41%) are self influencer, 21% are

influenced by family members.

Self

41%

Family members

21%

Friends/

relatives

27%

Mechanics

7%

Any other4%

Self

Family members

Friends/ relatives

Mechanics

Any other


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Table 10.9 Impact of price got on the purchase of bike

Very High 54High 68Neutral 16Low 4Very low 8

This table shows that the impact of price is high (46%) on the purchase decision,followed by high (36%).

Very High

36%

High

45%

Neutral

11%

Low

3%

Very low

5%

Very High

High

Neutral

Low

Very low


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Table 10.10 Satisfaction level of the respondent with the

mileage of bike

HH Bajaj TVSFully satisfied 12 18 24Satisfied 17 13 9

Neutral 13 7 5Dissatisfied 2 9 3Fully Dissatisfied 6 3 9

This table shows that TVS gives more satisfaction followed by bajaj and hero honda

in the case of mileage.

12

17

13

2

6

18

13

79

3

24

9

53

9

0

5

10

15

20

25

30

Fully satisfied Satisfied Neutral Dissatisfied Fully

Dissatisfied

HH

Bajaj

TVS


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Table 10.11Satisfaction level of respondent with the after

sales services of your bike

HH Bajaj TVSFully satisfied 9 14 16Satisfied 24 11 5Neutral 10 21 23

Dissatisfied 6 4 5

Fully Dissatisfied 1 0 1

This table shows that TVS is better in the case of fully satisfaction but in case of just

satisfaction hero Honda is much better then TVS and hero Honda.

9

24

10

6

1

14

11

21

4

0

16

5

23

5

1

0

5

10

15

20

25

30


Dissatisfied

HH

Bajaj

TVS


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Table 10.12 Satisfaction level of the respondent with the

overall performance

HH Bajaj TVSFully satisfied 11 9 18Satisfied 20 17 8

Neutral 13 15 16Dissatisfied 4 7 4Fully Dissatisfied 2 2 4

This table shows that in the case of overall satisfaction all are performing very well.

i.e., the most of the customers are either satisfied or neutral.

11

20

13

4

2

9

17

15

7

2

18

8

16

4 4

0

5

10

15

20

25


Dissatisfied

HH

Bajaj

TVS


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Table 10.13 Company giving the most benefits to customers

Hero Honda 400Bajaj 225TVS 275

This table shows that mot of the respondent (44%) says that Hero honda gives more

benefits to the customers, followed by TVS(31%) and bajaj(25%).

Hero Honda

44%

Bajaj

25%

TVS

31%

Hero Honda

Bajaj

TVS


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Table 10.14 Next purchase

HH Bajaj TVS car

Hero Honda 8 16 7 19

Bajaj 11 21 2 16

TVS 14 11 17 8

This table shows that the frequency of hero hondas customers is more in purchasing

car, followed by bajaj. In the case of repurchase bajajs customer are brand loyal

than others.

8

16

7

19

11

21

2

16

14

11

17

8

0

5

10

15

20

25

HH Bajaj TVS car

Hero honda

Bajaj

TVS


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FINDINGS

The findings of the study of customer are their preferences for the two wheelers:

The customer preference for the two wheeler is effected by various factors

like fuel efficiency, after sales service and price, brand name etc. This has

been represented with the help of pie charts & bar graphs.

Price is the most important consideration of the individuals while the purchase

of two wheeler and it might also be the reason because of which an individual

might shift from one brands to another.

After sales service is also an important consideration for the purchase of two

wheeler.

The customers are most affected by the friends and family members for their

choice or purchase of a particular two wheeler.

Customers expect a two wheeler with good mileage.

People are very much aware about the two wheeler.

In todays era of competition most of the companies provides most of thebenefits to the customers.

T.V., newspapers and magazines are the most effective medias in case of two

wheeler.


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Recommendation:

Recommendation refers to the outcome of the research work done and the

suggestions for implementation i.e. findings.

1. It is suggested that manufacturer should make all efforts to control cost.

2. New technology should be applied according to the requirement of the

customer.

3. Provide various schemes which attract the customers.

4. Spare parts of the bikes should be easily available in the market.

5. Bike should be fuel efficient.

6. Bike should be available in different colours so as to attract college going

students.

7. Bike should be given sportier look.

8. look of the bike should be macho in the case of young boys.

9. Companies should also manufacture the bikes of international style and looks.

10. Companies should run the awareness camps through which one can get the

information regarding the various model of bikes.


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BIBLIOGRAPHY :

1. Schiffman Leon G. and Kanuk Leslie Lazar

Consumer Behaviour Published by: Prentice-hall of India Private Limited.

2. Gupta C.B. and Dr. Nair N. Rajan

Marketing Management Published by: Sultan chand & sons

3. Philip kotler

Marketing Management Published by: Pearson

4. Kothari C.R

Research Methodology Methods & Techniques Published by: Wishwa

Publication

5. http://www.tvsapache.com

6. http://www.bajajauto.com

7. http://auto.indiamart.com/motorcycles/

8. http://www.thehindubusinessline.com

9. http://www.indiabike.com
http://auto.indiamart.com/motorcycles/http://auto.indiamart.com/motorcycles/


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QUESTIONNAIRE:

Tick ( ) whichever is relevant:

1.Name :

2.Place :

3.Age :

Q.1 Do you have the bike?

o Yes

o No

Q.2 Which brand of bike do you have?

o Hero Honda

o Bajaj

o TVS

Q.3 Are you aware about the bike available in the market?

o Fully aware

o Less aware

o Unaware

Q.4 How long do you own this bike?

o Less than one year

o One year to two year

o Two year to three year

o More than three years

Q.5 How did you came to know about this brand/ model?

o Through friends

o Advertisements

o Publicity

o Family members

o Any other


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Q.6 Which factor influence you the most to purchase the bike?

o Brand image

o Mileageo Price

o After sales service

o Any other

Q.7 Why did you prefer this model/ bike?

1 2 3

o Price - - -

o Mileage - - -

o After sales service - - -

Q.8 Which type of media influences your purchase behaviour?

o T.V.

o Newspaper

o Hoardings

o Magazines

o Wall paintings

Q.9 Who influences you more in buying decisions of bike?

o Self

o Family members

o Friends/ relatives

o Mechanics

o Any other

Q.10 What impact has price got on the purchase of bike?

HH TVS Bajaj

o Very High

o High


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o Neutral

o Low

o Very low

Q.11 Are you satisfied with the mileage of your bike?

HH TVS Bajaj

o Fully satisfied

o Satisfied

o Neutral

o Dissatisfied

o Fully Dissatisfied

Q.12 Are you satisfied with the after sales services of your bike?

HH TVS Bajaj

o Fully satisfied

o Satisfied

o Neutral

o Dissatisfied

o Fully Dissatisfy

Q.13 Are you satisfied with its overall performance?

HH TVS Bajaj

o Fully satisfied

o Satisfied

o Neutral

o Dissatisfied

o Fully Dissatisfied

Q.14 According to you which company gives most benefits to customers?

o Hero Honda

o Bajaj

o TVS


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Q15. Next time which brand of bike you would like to purchase if you have

to purchase another or will go for car?

o Hero honda

o Bajaj

o TVS

o Car

Documents

Value Creation Thru M&A