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Tata Motors Limited Message Board

  • eddieguer eddieguer May 18, 2007 12:46 PM Flag


    If TTM can sell 50 million units of the $2500 car that's coming out next year, they can get a top line revenue of $125 billion. That's not shabby. Anyone out there care to offer some input? Is it possible that they can sell to 5% of India's population?

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    • India's population is a billion out of which 300 million is middle class and able to afford cars. Assuming an average of one car per 3 people (avg family size as there are a lot of single young people) in this population there is a total market of 100 million cars. Assuming an average of 5 years life for a car there is an annual market of 20 million. Out of this the small car market is 80% so 16 million. If Tata can manage to take 50% of this market it will be 8 million units. However even 8 million is a huge number and the current factory Tata is setting up can create 500000 cars a year and upgradable to 1 million. So I fully expect them to sell 1 million car which will give a topline of 2.5 billion dollars from the small car market . This would be on top of 1.5 billion right now from other cars (the rest 6 billion is buses, trucks and railway engines) So we should rise from 7.5 billion to 10 billion so a 33% growth rate . Not bad.

    • Sure they can. Last month about 1 million shares added to the short list AND the PPS goes on up anyway! Now I like that action, yes!

      • 1 Reply to garyjoe1
      • OK.

        So, if 50 million individual units can potentially be sold, then what will this suddenspike in the number of units on the road affect an already horrible traffic situation? I know that in India, even people with lots of money don't choose to buy a car because of the practicality---where the hell will they park if they want to take their new mini-car to the movies or shopping? Will the infrastructure meet the demand? Maybe somewhat.

        Will villagers buy this car given a decent loan term? I suspect "yes".

        If Tata can provide a vehicle that small farmers could use to transport their wares, and for the small merchants to move merchandise, and for the postal service, etc etc. I think we have a winner here.

        Tata could make loads of money on the interest on the car loans as well as the secondary markets for parts/service, etc.

        There really is wealth at the bottom of the pyramid.

    • $2,500 doesn't seem like a lot to us in the land of $30,000 cars, but ask the average impoverished Indian who rides to work on top of an overcrowded choo-choo train, eats lunch with Baboons and walks around in a bed sheet.

      • 1 Reply to nrbmedia
      • Something tells me that you have never actually been to India. :)
        You are completely off. Even if a whole bottom one third of the Indian population were to meet your description (and they don't Mr. Baboon) the remaining two thirds would be twice as large as the entire US auto market and relatively unpenetrated at that. Think the early era of the auto industry here. This stock has huge potential.

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