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Eicher plans to invest Rs 600 crores in Royal Enfield

Eicher plans to invest Rs 600 crores in Royal Enfield

Snapshot: Royal Enfield - the feather in Eicher's cap - is all set to get undivided attention from its parent company

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A few weeks ago, we had done a story on how Royal Enfield single-handedly saved the fortune of Eicher Motors last financial year. When the sales of every other product dropped drastically, Royal Enfield recorded a growth of 85% during the first quarter of 2014 over 2013's first quarter.

To make it continue enjoying all the pampering Eicher has to offer, Royal Enfield will get a kitty of Rs 600 crores. This money will be dedicated to product and manufacturing including some new areas. This money has been allotted for the calendar years 2014 and 2015 and for both the facilities of Royal Enfield at Oragadam and Thiruvottiyur in Tamil Nadu.

The new facility at Oragadam, which started functioning last year, is five times bigger than the old plant and will have a roadmap to lean upon as it has more space which was a big constraint in the old plant.

Commenting on the magnificent performance of Royal Enfield in the first quarter of 2014, Siddhartha Lal, MD and CEO of Eicher Motors said, "We have already seen that we have grown 85 per cent in sale and in production approximately is the same over last quarter. So the growth has been extremely substantial over Q1 (as the company follows calendar year) of last year and we continue to add capacity at a very rapid pace. We are over the hump as far as our capacity catching up with demand concerned. It is still obviously a few months out or may be six months or a year.”

Eicher aims at producing 2,80,000 units in 2014 as the demand for Royal Enfield motorcycles has shot up with it entering new markets and launching new models.

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