- 05 Dec 2024
- ICICI Securities
INAUGURATES NEW ASSEMBLY PLANT IN THAILAND
News:In a press release, Royal Enfield has officially announced the inauguration of its new Completely Knocked Down (CKD) assembly plant in Thailand, marking a significant expansion of its operations in the Asia-Pacific region. This facility, which spans 57,000 square feet, has an impressive production capacity of over 30,000 units per year and is Royal Enfield's first fully owned assembly plant in Thailand, as well as its sixth CKD plant globally, following similar facilities in Nepal, Bangladesh, Brazil, Colombia, and Argentina.
Views: The establishment of this plant underscores Royal Enfield's commitment to enhancing its presence in Thailand, which has been a strong market for the brand. The company has reported a growth rate exceeding 150% since its entry into the Thai market, driven by a passionate community of motorcycle enthusiasts. Moreover, the recent successful launches like Guerilla 450, Bear 650, Classic 650 and newly introduced electric vehicle brand, Flying Flea with models like the Classic-styled Flying Flea C6 and Scrambler-styled Flying Flea S6 are expected to drive volume growth in coming quarters. Hence, we maintain a positive outlook on the company, expecting it to deliver double digit returns in medium to long term. Capital efficient business model and cash rich B/S remain structural strengths for the company.
Impact: Positive