Change Is Constant
ACF 100: Business Environment
Coursework Assignment 3:
“Share Price Group Project”
Introduction
Hero Honda is a two wheeler producing company which is based in India. The company had started back in 1984. As the name suggests, it is a joint venture between India’s hero groups and Japanese Honda Motors Corporation. It is the largest two wheeler producer in the country. In Indian market, the two main competitors of Hero Honda are Bajaj Motors and TVS Motors.
Hero Honda has been the major manufacture of two wheelers since a long time as seen in the market, with a market share of 60% in motorcycles and 43% in two-wheelers; it has made a great impression on the mind of the customers.
Company Analysis
As shown below almost till 2008, the company’s share prices weren’t very high, they maintained a lower base. But from October 22 share prices have started rising (as shown by the black line) because the company had reported about their leadership performance with 50 % net profit in quarter 2, '08-09 on the day before. This share price increase continued in the year 2009 also, and from there on, in 2010 they have been increasing at steady rate.
(Adapted from moneycontrol.com, 2011)
However with the passage of years, the company has seen ups and downs and recently the company is in news because of the joint venture termination between hero group and Honda Motors Company. This news was announced on 16 December 2010 and on the same day the share prices went up rapidly as shown below by the black line in the middle. Such a rapid increase in the share prices was not seen before the announcement or on the other days.
The estimated reason of the break up which leads to the increase of the share prices can be because of their technology pact which will be loyal to them till 2014. People would still like to buy shares as they the name Hero Honda is linked with trust and quality; this could be another reason of the share prices going up after the
Coursework Assignment 3:
“Share Price Group Project”
Introduction
Hero Honda is a two wheeler producing company which is based in India. The company had started back in 1984. As the name suggests, it is a joint venture between India’s hero groups and Japanese Honda Motors Corporation. It is the largest two wheeler producer in the country. In Indian market, the two main competitors of Hero Honda are Bajaj Motors and TVS Motors.
Hero Honda has been the major manufacture of two wheelers since a long time as seen in the market, with a market share of 60% in motorcycles and 43% in two-wheelers; it has made a great impression on the mind of the customers.
Company Analysis
As shown below almost till 2008, the company’s share prices weren’t very high, they maintained a lower base. But from October 22 share prices have started rising (as shown by the black line) because the company had reported about their leadership performance with 50 % net profit in quarter 2, '08-09 on the day before. This share price increase continued in the year 2009 also, and from there on, in 2010 they have been increasing at steady rate.
(Adapted from moneycontrol.com, 2011)
However with the passage of years, the company has seen ups and downs and recently the company is in news because of the joint venture termination between hero group and Honda Motors Company. This news was announced on 16 December 2010 and on the same day the share prices went up rapidly as shown below by the black line in the middle. Such a rapid increase in the share prices was not seen before the announcement or on the other days.
The estimated reason of the break up which leads to the increase of the share prices can be because of their technology pact which will be loyal to them till 2014. People would still like to buy shares as they the name Hero Honda is linked with trust and quality; this could be another reason of the share prices going up after the
References: 2. Anonymous. (2010). Hero, Honda separation to be announced today. 3. Bhattacharya, S. (2010). Split unlikely to impact Hero Honda biz soon. 4. Dongre, M. (2010). Hero Honda split, little short-term impact, more long-term negatives. Available: http://www.moneylife.in/article/4/12521.html. 5. Anonymous. (2010). Hero Honda Motors. 6. Yadav, M.. (2011). Hero Honda in Rural Market. 7. Anonymous. (2010). Sep 2010 sales numbers of our Indian 2 wheeler manufacturers. 2.Anonymous. 2010. Hero, Honda part ways in deal valued at $2 bn. Business Standard Online, [internet] 17 December. 3. Banerjee, R., Kumar, N., 2011. Rivals hoping Hero won’t go far without Honda. The Financial Express Online, [internet] 1 January. 4. Bhattacharya, S.J., 2010. Split unlikely to impact Hero Honda business soon. DNA Online, [internet] 17 December. 5. Sahu, R.P., 2010. Concerns over Hero-Honda split recede. Business Standard Online, [internet] 17 December. 6. Anonymous. 2010. Post-Hero Honda split, Bajaj sees a hyper-competitive market. The Economic Times Online, [internet] 18 December.