Ladies and gentlemen, good day and welcome to the TVS Motor Limited Q1 FY 2027 earnings conference call, hosted by 360 ONE Capital Market Research. As a reminder, all participant lines will be in the listen-o nly mode, and there will be an opportunity for you to ask questions at the end of today's presentation. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I would now like to hand the conference over to Mr. Annamalai Jayaraj from 360 ONE Capital Market Research. Thank you, and over to you, sir.
Thanks, Manav. Good evening, all the participants. On behalf of 360 ONE Capital Market Research, welcome to 1Q FY 2027 post-results conference call of TVS Motor Company Limited. I also take this opportunity to welcome the management team of TVS Motor Company. We have with us today Mr. K. N. Radhakrishnan, Director and Chief Executive Officer, Mr. K. Gopala Desikan , Chief Financial Officer. I will now invite Mr. K. N. Radhakrishnan for the opening remarks, to be followed by question- and- answer session. Over to you, sir.
Good evening, everyone, thanks for joining us today. We are delighted to share the Q1 performance of this financial year. As you know, the Q1, comparing the last year Q1, the overall sales volume has grown to 1.63 million from last year's 1.28 million of the same quarter, 28% growth. The revenue is at INR 13,896 crores, a growth of 38%. Last year's number was INR 10,081 crores. Operating EBITDA grew from INR 1,260 crores to INR 1,779 crores, 41% growth. Operating PBT grew from INR 1,015 crores to INR 1,439 crores, 41% growth. Profit after tax grew from INR 776 crores to INR 1,176 crores, 51% growth. Once again, thanks to the entire customers, because this has been possible only because of our customer-centricity approach and strong brands across all brands and our sustained focus on cost reduction initiatives taken up by the company.
Once again, we would like to thank our customers for this significant milestone. I'll give you more details about the Q1 sales 2026-2027. The two-wheeler domestic ICE sales grew by 21% compared to last year's Q1, against the industry growth of 13%. The two-wheeler international market ICE grew by 31%, two-wheeler overall, the ICE sales grew by 23% against the industry growth of 21%. Two-wheeler EV sales grew by 86%. All of us know that in the first quarter, the EV industry has significantly grown in India. We did a volume of 130,000 in Q1 this year, as against 70,000 during the first quarter of last year. Total sales of three-wheeler also grew by 48%. We are at 67,000 units this quarter, as against last year's 45,000.
On financial performance, as I said, company posted its highest operating EBITDA of INR 1,779 crore, a growth of 41% for the first quarter. This is against INR 1,260 crore first quarter last year, 2025-2026. The company's operating EBITDA margin improved by 30 basis points at 12.8% during the first quarter, this is against 12.5% last year first quarter. Company posted highest PBT, INR 1,589 crore, recording a growth of 51% for the first quarter as against INR 1,050 crore in the first quarter of last year. PBT for this quarter includes fair valuation gain of investments held by the company amounting to about INR 150 crore, as against fair valuation gain of about INR 28 crore during last year first quarter. The current quarter company's profit after tax grew by 51% at INR 1,174 crore as against INR 776 crore during first quarter of 2025-2026.
We are also proud to announce that recently our long-term facilities credit rating has been upgraded from CARE AA+ to AAA, the highest level of credit worthiness awarded by CARE Ratings. This is a direct reflection of our consistent performance and the trust we have earned, and the deep responsibility we carry as we shape the future of mobility. This recognition further strengthens our ability to invest for long-term, expand our global footprint, accelerate innovation, and create sustainable value for all stakeholders. TVS Credit performance has been outstanding. TVS Credit Services reported a sustained growth in disbursement supported by improved consumption demand, traction across key retail financing segments. Consumer durable financing growth was driven by higher discretionary spending and premiumization, increased reach, and penetration. The two-wheeler category witnessed strong demand due to steady semi-urban and rural participation and marriage season, buying along with increase in electric vehicle growth.
During this quarter, TVS Credit continued to enhance its capabilities in AI, data and analytics, and technology to drive better risk assessment, customer experience, and operational efficiency. Credits further expanded its presence across semi-urban and rural India, increasing its network to nearly 62,000 touch points across the country. TVS Credit disbursed loans over 14 lakh new customers, bringing the total customer base to nearly 2.6 crore. The book size of TVS Credit grew by 19%. It is at INR 32,053 crore as against INR 26,898 crore last year. Profit before tax for the quarter grew by 16%, INR 283 crore as against INR 243 crore during first quarter of last year. On international business, in Q1, we have recorded highest ever international business sales of 4.68 lakh units, a growth of 33% year-on-year growth. The performance was driven by sustained demand across key international markets and continued strengthening of our distribution.
In fact, the demand is much more. We are enhancing the capacity to meet the demand. This is a very positive news. The HLX series has got huge pull from the market, we are very happy that this segment is doing extremely well. All the other product ranges are also doing extremely well in the international market. We are investing behind capacity, we are confident that we will be able to significantly improve these numbers quarter- after- quarter on two-wheelers. Equally on three-wheelers. Africa continues to be a key driver of export growth, supported by robust demand for two-wheelers and three-wheelers. Here, specifically, I want to thank all the HLX customers in Africa and three-wheeler customers. LatAm region also has started doing well for us. We are growing ahead of the industry.
We have just started our journey in LatAm, and I'm pretty confident this is one market which is also very important for us, and the growth momentum of the industry is very good. We are now present in most of the countries in LatAm, and we will start investing in marketing and product. In this market, I'm pretty confident that we will continue to grow ahead of the industry, leveraging our products from India and Indonesia. Asia performance has been pretty good, and we are growing here also very well, and we will continue to grow ahead of the industry in this market as well. We remain focused on strengthening our international footprint through market expansion, product portfolio enhancement, and deeper channel engagement while continuing to capitalize on growth opportunities across emerging export markets.
We are investing on premium products, also we are putting a lot of investments behind brand-building initiatives. I'm very sure our products like Apache is going to do extremely well along with Ronin. Some of the key highlights, if I look at it during this quarter, our TVS HLX has crossed 5 million. 13 years back, we started this journey on TVS HLX series. Today, we have HLX 100, 125, 150. All these brands are doing extremely well in many markets. What is more delighting for us is the last 1 million has happened in the last one year. The speed has gone up, the demand has gone up, and the HLX brand stands for its customer, durability, reliability, and in terms of low maintenance costs across Africa, Middle East, and LatAm.
We have also launched TVS Apache RTR 160 4V in some more markets this quarter. We have also unleashed the Ronin Monotone and Agonda variants in many international markets. I'm pretty sure that Ronin is one brand that is going to do extremely well in the international market as well. As you know, domestic market, Ronin is doing very well. Now, we are also now expanding multi-products into these markets. In addition to HLX, now RTR 180, 200, 310 all are getting launched in various markets. The Raider, TVS Raider is also getting introduced in Egypt. I'm very sure this is going to help us in strengthening our North African region. We have launched King EV Max in Nepal, strengthening EV portfolio, starting in the international market. Now coming to Norton.
Norton Motorcycles, we have very clearly highlighted your theme, Manx R and Manx, the Super Bike and the Naked and Sport, and also the Atlas and Atlas GT. [inaudible] is getting ready. Production has started for Manx and Atlas has started production in Hosur. I'm very sure that Norton models, the highest-end super premium motorbikes are taken with utmost focus on design, quality, and performance. These four models, which are the first Norton models, are made under the TVS Motor ownership, will launch in U.K., France, Italy, Germany, Spain, and India, and later this year in the U.S.. Norton Motorcycles have marked the rollout of first Atlas models at TVS Motor Company's Hosur manufacturing facility in June, and it has started moving into Europe. I'm very confident that you will see this product in the next quarter. Atlas is one of the most significant addition to Norton range.
The modern era engineered for sales across every Norton market, both present and future. Atlas and Atlas GT models return the story marks to adventure and sport touring segments respectively, and these categories that account together a substantial part of the growing share of global motorcycle sales. I'm very sure that TVS Motor and Norton, the British design engineering capability with Indian manufacturing excellence and our focus on customer shared commitment to quality for customers worldwide. It is going to be making a grand impact in many of the markets where we are planning to launch. You would have all seen our premium bespoke experience channel, TVS Paddock. We have recently announced this and we are going to experience it in India soon. Paddock is our strategic commitment to redefining premium ownership by bringing together innovation, personalization, immersive engagement to build deeper customer connections.
When we look at the Q2. Q2 industry is likely to do very well. Two-wheeler industry, I'm very sure it will maintain the same momentum. A double-digit growth is minimum what we are expecting in the market. Very healthy ICE demand and EV could be similar to the growth that we have witnessed in Q1. Overall, the outlook remains very strong. We are looking at, while there are challenges on monsoon progression and some elevation in terms of the food and energy prices, the demand looks very strong. The domestic demand supported by the GST rationalization and some of the relief coming from the income tax in also affordability is going to help us. We are pretty confident that you will see July, August, September same momentum or slightly better momentum than Q1 to continue.
On international market, we are expecting the same growth rate to continue or slightly better growth rate. We are also investing behind capacity. That is going to help us. You would have seen the overall growth in Q1 was very good and we are expecting the growth in the industry slightly better in Q2. The EV growth we saw about 67% in the first quarter. I'm expecting the growth to continue in Q2. Overall, there are many factors, structural demand drivers, replacement demand, affordability, continued EV adoption. All these are going to be supportive and I'm pretty confident that TVS will do much better than the industry growth. In Q1 because of the West Asia conflict, there was a volatility in commodity prices, including steel, aluminum.
There were some sharp increases in our material cost and this translated into input cost pressure and intermittent supply chain disruptions affected availability, especially in the month of April, the supply were affected for us. Now we have recovered in May. June was much better and we will continue the momentum in July, August, September. We are also investing behind capacity like I said, uptime. What is most important is we are also able to mitigate these cost increases through top- line growth. Also some price adjustments in quarter one and we are also closely watching and we will do appropriate opportunity driven price increases in Q2. Cost optimization and management scale benefits will continue in quarter two. Despite all these uncertainties, I think we are very happy that we had a healthy growth and we are also focusing on continued growth going forward.
The EV side, I think we would have seen in Q1 the penetration has already[audio distortion]. In the month of June alone, if you look at it is over 10.6%, which is a big change. We continue to lead the Indian two-wheeler market and we have grown ahead of the industry thanks to our portfolios of iQube and Orbiter. We are extremely happy and thankful we have crossed 1 million iQube. It has played a key role in the journey of electric mobility adoption in India. Thanks to government for all the support given in the early adoption of EV and TVS iQube has grown into one of the most preferred electric scooter brand and country's favorite family EV. The milestone marks an important chapter in India's electric mobility journey and underscores the country's progress toward sustainable, smart, self-reliant mobility future.
On commercial mobility when we look at it on the three-wheeler, EV penetration first time has crossed 40%. Significant growth. Here also we have grown ahead of the industry and we want to continue to invest and grow in this segment. We have also announced our strategic partnership with IOCL to strengthen the last mile LPG cylinder distribution to sustainable commercial mobility solutions like cargo. We will continue to invest behind overall capacity for our three-wheeler, both in domestic as well as in international markets. I already highlighted there was commodity prices sharp upward trend during Q1. Okay, we are closely watching, and we are also appropriately looking at opportunities to rightly give price increases, equally leverage the cost benefits, product mix, geography mix, and this journey will continue.
I'm very confident that during this quarter, Q2, because we'll be getting ready for our season, which is November, this year, October and November. There are planned launches during that time, which is going to delight many of the Indian customers. Our complete product portfolio, unwavering focus on consumers, our quality new products, and very clear focus on attractive quality features and technologies. TVS Motor is confident about outperforming the industry both in domestic and international markets. We continue to navigate cost pressures and supply chain constraints during Q2. As we speak, the customer retail demand across both two-wheeler and three-wheeler are very robust, and we are trying to catch up with increased capacities both in domestic and international markets. During the first quarter, you would have seen EBITDA of 12.8% despite all these pressures.
We will continue to leverage scale benefits, better product mix, sustained effort on cost reduction, which will enable us to further improve our EBITDA journey. Thank you.
Thank you, sir. We will now begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on their touch- tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. We have our first question from the line of Nitin Arora from Axis Mutual Fund. Please go ahead.
Hello?
Hello. Yeah.
Hello. Am I audible, sir?
Nitin, can you please use your handset?
Maybe a little bit louder.
Yeah. Hi, sir. Good evening.
[inaudible]
Many congratulations. Sir, just one question on the EV, if you can throw some light, what is our capacity? How much that capacity we are ramping- up over the next one to two years? Second, if you can throw some light on the EV penetration, which you are talking about even the last two quarters that industry will see surprise, industry growth will be very good in EV. Any specific consumer insights if you can share what is leading to it? Just on the capacity side, how much is the current one and how much you are building up for the next two years?
See, we had about 40,000 capacity. We are now moving to 50,000 +. We are also constantly reviewing what is the next set of capacities required. At this point of time, this has to be very closely watched, and we are investing behind that. Same way, on the EV side, three-wheeler side also, we are looking at capacity. Like I said, we had about 20,000 capacity. We are now moving to about 30,000 capacity in three-wheelers. Okay? A good proportion will be on the EV side as well in three-wheeler. There is an opportunity to grow further. As you know, capacity can be taken up step- by- step because it takes about three to four months to increase the capacity. We are not so much worried about expansion.
We are also significantly increased our overall two-wheeler capacity, like I said, to 8.3 million this year. It will happen over a period of quarter- after- quarter. On EV, if you look at it, I think initially it started with urban. We used our networks, current main dealer network. Now we have started also supplying to the semi-urban. Progressively, we will also start moving to the rural India. As it says, iQube when we look at it is a scooter. Customers are agnostic to the technology. They love iQube. We have to look at it. Today, common man has started buying. Definitely, common man has started buying. Initially, it was more of people who were looking at innovation, new technology.
As we progress now month- after- month, we are able to see that there are many customers who otherwise would have bought an ICE scooter or a motorcycle. In fact, some of the people from the motorcycle category are also moving into scooter.
Got it. Very helpful, sir. All the best to the team. I'll come back in the queue.
Thank you.
Thank you. Before we move on to the next question, we will request all the participants to please restrict yourself to only two questions per participant. Should you have a follow-up question, we request you to rejoin the queue. We have our next question from the line of Pramod Kumar from UBS Securities. Please go ahead.
Yeah. Thanks a lot for the opportunity. Am I audible?
Yes.
Yeah. Sir, I think, as I said, congratulations. I think excellent set of numbers in a tough environment. My question is something different related to what's happening in the marketplace, sir, because while the industry is grappling with significant cost hike, we have seen one of your major rival is actually on a discounting spree in the scooter category, and which effectively puts your product at a substantial premium versus what the competitor is offering the product at. Even with that, you have been gaining market share both on the wholesale and on the retail front. If you can just help us understand what's happening and where are we in terms of supply versus demand on our scooter franchise. Because I see that on wholesale, you have already closed the gap with the market leader or category leader to single digit.
What is driving this kind of brand momentum for you, where customers are willing to pay a reasonable premium, if not substantial, a reasonable premium over competitor models, and that to the segment leader? If you can just share your thoughts there, and any implications of all this in terms of is the positive rub-off also helping your electric scooter franchise as well?
Overall, we have an excellent range in scooters. If you look at it, the old Scooty. Of course, we have stopped the Pep, but the other Scooty is still there. The 100cc scooter is still there. We started Jupiter 110. We also then did NTorq 125. We did Jupiter 125. Now we have done NTorq 150. I think all the brands are positioned on customer segments very carefully. These customers love this. These products, they really love it. We were always constantly believing that the category of scooter will grow substantially, and which is happening. If I now include ICE plus EV, the scooter category share in India is almost 40%. It is going to grow. It's going to grow. This is number one.
Number two, when we look at Jupiter 110 or Jupiter 125 or NTorq 125 or NTorq 150, we constantly upgrade and give new technologies, new features to our customers because we believe in giving something new every time to the customer, because that is very important. This is on top of best-in-class durability, reliability. This is something, [Lead-acid power] , if you look at the scores, we have scored very high scores, number one position, number two positions in scooter category. This is what is most important. We always maintain less than 30 days of stocks with the dealers. We don't want to lose the retail, all cash-and-carry dealers, they have to keep the right stock, right colors, right models, and we are very clear, and we invest behind.
You would have seen during the IPL season also now, very good brand awareness and creating why our scooters are good. I have a lot of respect for all our competitors because each one has got their own strategies. With now retail financing coming in, there is a greater opportunity to grow this segment in India. I am of the view that scooter category share will go up substantially, and we need to learn from our consumer and customer requirement what opportunity we can do to further increase it. Overall, it is a focused, customer-driven approach of giving them the best-in-class attractive quality with features, technology, and also consistently delivering new products and refreshes for the season and looking at the right spaces. I think that is what has helped us to grow ahead of the industry.
Sir, second question. What is the dealer inventory what you are carrying right now, including transit, and what is the target number of days you would like to have before the start of the festive season? We see that you've been upping production and dispatches month- after- month, but your inventory numbers are not ramping- up reasonably because of the strong retail. If you can just help us understand where would you like to be for a comfortable inventory position so that you don't lose out on the retail demand in the festive. Also along with that, if you can just share the export revenue number for the quarter, sir. Thank you.
The inventory target maximum 25 to 30 days with the dealers. Okay. That is the number we always keep. Maybe during season, it's 30 days because Dhanteras, one day, you know how the hike happens and the whole huge increases. Maybe at that time, maybe another four, five days more. Otherwise.
month- after- month, they're always below 30 days. Okay?
The optimum is we should not lose the retail. This has to be calibrated model-wise, color-wise. That is the way we work. Looking at overall this quarter, IV revenue is about INR 3,634 crores.
INR 6,336?
INR 3,634 crores.
Thanks a lot, sir. Thank you. I'll get back into queue, sir. Thank you.
Thank you. A reminder to all participants. Please restrict yourself to only two questions per participant. Should you have a follow-up question, we request you to rejoin the queue. The next question is from the line of Vinay from Morgan Stanley. Please go ahead.
Hi, team. Thanks for the opportunity. My first question is on your EBITDA margin. You know, in the last call, we talked about 3%-5% commodity headwind. You highlighted that 30% of it is passed on. Is it fair to say that the worst of commodity headwind is already there in this margin?
Commodity, the significant proportion has happened in Q1. There may be another marginal one because this time also, the war situation is up and down, and especially on aluminum and some of the plastics and some other parts which are related to oil, is also moving up and down. This is something we have to closely watch. According to me, we always focus on the top- line. We look at the product mix, we look at our journey. All this has happened in one quarter as the first day. Even if you increase prices, it will take time to come back. That's why I said we have taken about 1.5% in the first quarter. Progressively, we have looked at in Q2 also 0.5%. It's a journey, and we look at from the customer point of view, and appropriately we will price it.
It is very important that we have to continue from the customer point of view, the growth momentum. I'm pretty confident that a combination of the product mix plus the growth and scale benefit and cost reduction, we have a very strong cost reduction team, is going to help us in EBITDA journey.
Right. Sir, second question will be on the electric vehicle side. If you could talk about now that, the iQube platform volumes are rising quite sharply, how is the profitability of that? Is that improving? How closer is it to ICE now? If any comments on EV profitability.
I'm extremely happy that we have crossed 1 million and our hit rate is going month- after- month. I completely agree with you. Contribution is becoming better and better quarter- after- quarter.
Right.
I'm pretty confident that we be little bit patient. We will reach contributions of whatever we are looking at as a company. At this point of time, quarter- after- quarter, our contribution is going up. We look at overall portfolio, how it is yielding results, and I'm very confident that the direction is the right way.
Right, sir. Sir, the PLI incentive number, if you could share that bit. Thanks.
PLI incentive number. Give me a minute. About 0.6%- 0.7% of the turnover.
Oh, thanks, sir.
Thank you.
Thank you. We have our next question from line of Gunjan Prithyani from Bank of America. Please go ahead.
Hi. Thanks for taking my questions, and thank you for the comprehensive comments on the various segments. I just wanted to follow up on the growth guidance that you gave for the domestic and the exports that you expect the similar momentum. Is it fair that you're essentially saying 20%- 30% growth should continue in quarter two as well? If you can just give us some sense on how to think about the full- year, because, with the second half GST, last year we did see a huge pump up post GST. On a full- year basis, how are you looking at growth outlook for both the segments, domestic as well as export?
The Q2 is also going to be good in terms of the growth. In my opinion, ICE could be slightly better than Q1. EV can keep up the same momentum or slightly better. In terms of the overall year, I think this year is going to be an extremely good year. Only important thing we have to all watch is the Q3, because the El Niño plus the base effect, GST, the benefit started coming end of September, and this year the season is going to be October- November. When I look at from the customer point of view, I think if there are a little bit of all this West Asia issues settling down, hopefully, I think that will give much more confidence. LPG is available, and prices are not growing as we think.
Q2 will put a good base for that. Overall, as a year, we should estimate an industry growth of double- digit.
Okay, got it. Similarly strong performance in the exports as well.
ICE will be very strong, I can tell you. EV, the growth momentum will continue. Definitely growth momentum will continue. You have seen already, I told you EV is 40% penetration and two-wheeler ICE is about 10.6%. I'm not taking the average 9%. I'm taking just the 10.6% of June itself is a good indication that consumers are considering EV in a big way.
Got it. Sir, just two very quick follow-ups. One on the EV revenues, if you can share what the number for this quarter was. Secondly, exports, yes, very strong momentum. Can you give us a little bit more color on what's really happening? Is it Africa recovering from the lows? Is it expansion of new markets? What really is driving this sort of 20%-30% growth in the export market despite the headwinds that we're seeing on the West Asia front? Because some of these markets have actually seen 50%-60% increase in petrol prices, right? It doesn't seem to have impacted the sentiment in those markets. Just trying to understand what's driving the growth momentum there.
You have asked two, three questions, let me digest one- by- one. The EV total is about INR 1,780 crore, somewhere around that. INR 1,780, approximately something around that. Second is on EV growth. Definitely Africa, you remember I said last year, the bad is over, the worst is over, the base effect is over. Predominantly this is a taxi market. Of course, the other commuting class is also slowly growing with the infrastructure, roads available in these markets. That is definitely helping. Now people are investing and the industry is growing significantly and this momentum will continue. Interestingly, LatAm markets are also doing well. Asia is doing very well. If you look at these markets where we are very good.
Even LatAm, we have started doing well, better than the industry, because we are present, every country we have a distributor and we are also leveraging our product range. It's a combination of the pool in the market going up, plus our product range.
Okay. All right. Thank you so much.
Thank you. We have our next question from the line of Kapil Singh from Nomura. Please go ahead.
Yeah. Good evening, sir, and congratulations. Just on the capacity, overall capacity, can you just update where are we today and what is the plan for capacity expansion?
I think last time I highlighted, we are going for 8.3 million, from the current capacity of about 6.8 million. In three-wheeler, we are going from a 0.25 million capacity to about 0.42 million. This is a big, big increase and that's why we are also investing somewhere around, including our new products, we are investing about INR 3,500 crores, new products plus all the capacity expansion. It is going to come over the last, next, one quarter is over, second quarter, third quarter. By fourth quarter, we will reach this 8.3 million capacity.
Thanks, sir. Also on the cost increase, can you quantify how much was the cost increase, that commodity cost increase we saw in Q1?
Commodity cost, I think it's about 3.5%, and maybe another 0.5% this quarter, because there is a quarterly adjustment. Overall, you can take about 3.5% and 0.5%, so about 4%.
Okay. Sir, just last question, you mentioned on
Sorry,[audio distortion] sir, the participant got disconnected. We have our next question from the line of Dipesh Vakil . Please go ahead.
Sir, am I audible? Sir, only one question. Congratulations on a good set of numbers. Sir, can you just give some guidance on the gearing? I think you've raised INR 500 crores lately at INR 730. Sir, you have a preference share redemption on 1st of September. Any plans, sir, to raise similar, I mean, to raise funds through debt in near term?
Lot of cross-communication and noise. Can you repeat the question?
Sure, sir. Sir, what I'm saying is that, I think you have some share redemption. Sir, I'll join the queue again, no problem. I'll join the queue.
Thank you.
Not able to
Yes, sir, he said he'll join the queue again.
Yeah.
We have our next question from the line of Chandramouli Muthiah from Goldman Sachs. Please go ahead.
Hi, good evening, and thank you for taking my questions. My first question is just around the draft Delhi EV Policy, looking to ban sale of ICE two-wheelers, possibly starting in calendar 2028. I just want to understand how you're thinking about potential offsets to the policy, how the industry is thinking about the policy at this stage. Also, is it going to be necessary to have electric motorcycle models in the market, to potentially give customers the option to replace motorcycle format from ICE to EV in that micro market?
See, these are all transitions we have to embrace, and we have to look at, for example, when electric penetration was not there, I think we went through a certain journey. One thing I can tell you is that today, the BS6 or the new technologies, what we are talking about EV, also the flex fuel, all are green. I think the way we will look at is how do we make sure that we give green vehicles for the future. Okay, this is going to be the journey. Okay. We will embrace these changes as an industry, and we will also work on new technologies.
Got it. That's helpful. Second question is just around, as you build out the Norton presence in more and more countries, just want to get your sense on how you're thinking about the go-to-market strategy. Is it going to be more place the product in multi-brand outlets? Or are you looking at doing it in single brand outlets? Will these be with local partners? Is TVS looking to own some of the stores to get early learning? Just the Norton strategy. Related to that, what is the rough volume you think the Norton motorcycles will need to hit to be able to achieve EBITDA breakeven at some point in the future?
I think what is most important, these products are ready now. Okay. We have started now establishing. It's a combination of independent dealers and multi-brand outlets in the premium category. It will be a combination. We are, like I said, first it's U.K., then Europe, then U.S., and India is very important in this journey. We will look at first getting the product range fully. Two into two, which is four products are getting ready now. It is getting into the market, there is going to be very clear positioning of these brand super premium bikes, which are going to be very attractive. Overall, I think it is going to delight the super premium customers. This is number one. Number two, as a company, we believe in delighting the customer first, then grow the top- line.
Because when the top- line comes, every line will come. Okay. That has been the consistent strategy of the company. I'm pretty confident that Norton, the way TVS has taken the ownership to drive it, I'm pretty confident between Solihull and Hosur. I am very confident it will drive and delight the customers first. Okay. We will start. Of course, there is a very clear plan, numbers. How do we achieve number by number? This is completely an internal strategy. Go-to-market will depend upon the consumer, country specific. If I have to answer here, it will take so much of time. That's why I broadly said it is going to be through premium experience. It is going to delight the customer and these products itself. You would have seen many of the articles from the media. The specialists have driven it. They have seen it.
You will see also, Atlas, the feedback from the magazines are likely to come in a couple of days. I'm pretty confident that these are all very clearly identified, the very specific super premium category positioning. We are also now expanding the network. The most important part is getting the products and customer loving it. I'm pretty confident, given the kind of products what we are seeing and the feedback initially what we are getting, it is going to be very good.
Thank you very much, sir. If you could just share spares revenue, I'll just go back into queue.
Spare parts revenue. Just give me a minute. Spare parts is INR 1,173 crores.
Got it. Thank you very much, sir, all the best.
Thank you.
Thank you. We have our next question from the line of Amit Hiranandani from PhillipCapital. Please go ahead.
Yeah. Hi. Many congratulations to the team for a great set of numbers. Sir, my question is broadly strategic in nature and related to export opportunities. I'm just combining these three questions into one for you to answer. First, how do you see exports evolving for the company over the next five years in light of the free trade agreements? Secondly, which products and segments are likely to be key export drivers? Lastly, what will be the critical success factors for winning in global markets?
Brilliant question. Today, as we speak, the contribution from exports is about 26%, I am saying just from my memory, overall turnover. Okay? This will grow. As we speak, it will grow. Okay? The reason behind this growth is the kind of product range, what we have from India and also from PT TVS Indonesia. I would say that we have the best range in the industry. Second, market- by- market, we are very confident that, segment-wise, we are also looking at what products we need for the future, and we are also investing behind that. Areas where we can significantly leverage is premium and super premium category. Apache is very good. Ronin can be leveraged very well in many markets. The new products, whatever, like including RTX. I think these are products, country specific, we can leverage it, take them, and then grow them.
On the other side, scooters. There are specific markets where scooters do very well. Okay, here I'm not including HLX as a category. HLX as a category, like I said, 100, 125, 150, four- speed, five- speed. I think this is something which is growing very fast. [inaudible] , when we look at the [inaudible] , they are doing extremely well in many markets. We are now further expanding the capacity in Indonesia. That is also going to help us. The growth ambition, we want to grow this 26% to much higher level going forward. Okay? We have started our EV journey in the international. iQube has started, Orbiter has started. I'm very confident that soon we will start with our three-wheeler. The most important thing is our presence in this market.
We are very strong distributors, and we focus on 3 S as a capability. Sales, Service, Spare parts. From day one, we look at giving the best quality, best durability, best reliability to our customers. We make sure that the service is given utmost importance. These strategies are enablers for making sure that we grow disproportionately our international footprint. Like I said, Africa has become very strong. Asia is very strong for us. Now, the entire focus is on Middle East and LatAm, including how do we grow there faster, what kind of spaces we have, customer segments we need to do. We prioritize. We prioritize and take this journey. I hope I have answered you. Of course, with Norton and some of the brands from India, especially on the super premium category, we are now getting into the developed market as well.
This is very helpful, sir. Sir, just one clarification on the domestic growth guidance which you have given. Can you please let us know what is the full- year target you have given for the industry?
I said it could be double- digits in ICE. EV can be well above. The penetration is about 10.6%. I think quarter- after- quarter, this will strengthen. The growth can be very good this year.
Note, sir. All the best. Thank you so much.
Thank you.
Thank you. We have our next question from the line of Arvind Sharma from Citibank. Please go ahead.
Sir, good evening, sir. Thank you for taking my question. The first question, sir, is on Norton. What's the target segment and the competitors that you're looking at when launching these four models, and what would be the key differentiator for Norton? If it is comparable, what was the peak volume for Norton historically, and sir, your investments there? That's the first question.
On Norton, I answered you. I think we are looking at certain segments, and the product will be both Manx and Manx R and also Atlas and Atlas GT. We are very clearly focused on, one is a super bike, another one is a naked and sport, another one is adventure and sport touring. We respect all the competitors there. They are all very strong. They have been there for a long time. Anything you give something new. If I take answering what are the unique features and technology, what we are offering, it will take another 10 minutes to explain to you. It's already published. Documents are available. You can go through that. There are many things which are unique, starting from the design itself. There are many things which are unique in Norton.
The most important thing is we look at the customer segment and give the best-in-class product, the performance itself. I'm pretty confident. Like I said, we are focusing on the customer first and then looking at establishing distribution network, service, and making sure that market by market entry strategy, creating the awareness and the consideration, significantly investing behind brand, because Norton is a super premium brand. That will translate into good volumes.
Sure, sir. What would be the investment you have made till now?
So far, we have invested about INR 2,000 crore. About INR 2,500 crore in the last four or five years.
Sure, sir. Sir, second question would be on the other expenses. There was a marked decline in other expenses. Are these sustainable, what were the key specific areas where this decline came from?
Other expenses, it includes marketing. It includes logistics. It includes many packing. If you recollect, in the month of April, there was a loss of production due to certain challenges because of this war situation and sudden availability of supplier parts. The conscious effort to look at some of these costs. In May and June, we are very happy that the production has come back to the normal level. We have not reduced anything. We looked at in terms of investing behind brand. We have looked at in terms of, as a percentage, I don't think you will see a marked difference going forward. Whenever a new product launch is there, definitely you will see the cost going up because there is a launch cost. In this quarter, there was no launch from our side.
Got it, sir. Thank you so much for taking my questions, sir. That's all from my side.
Thank you. Can we go to the last question, please?
Sure, sir. The last question will be from the line of Pramod Amthe from InCred Capital. Please go ahead.
Thanks for taking my question. Sir, if I have to look at your annual report, you indicate that you have got a government incentive of almost INR 1,100 crores. First question regarding the same is what's the split between PLI and the other export incentive of the same one. Second, against that, you are showing almost a pending receivable of around INR 700 crores, which is almost around, if I had to look at 12 months sales, it's almost like seven to eight months. How confident you are? Where is it stuck? What is happening there?
These are all PLI. If you look at many of the receivables are once in a year, we are confident that all this will come. There is nothing which is going to be affecting us going forward. I already told you about 0.6%-0.7% related to PLI last year. The remaining are all other incentives from exports.
In that calculation, INR 1,100 crores is almost like a 2.4% of your sales. Right? The incentive. You are saying 0.6% is PLI. Remaining should be almost around 1.8%.
Our exports have done last year also pretty well.
Right. There is also a receivable bit pending from even export incentives? Because it looks like one-fourth is PLI, which is just INR 150 crore-INR 300 crore.
No, I don't want to get into mathematics here. There is no concern in that area. Some are quarterly, some are annually. PLI is annually.
Yes, I was just asking if I split it up, just around INR 350 crore is PLI. Versus that, the INR 750 crore is a receivable. If you are saying the large part is PLI receivable.
Yeah, PLI.
Just a clarification.
Yeah. INR 600 crores is about PLI.
That's the receivable.
That is the receivable.
Okay. You are confident you will get it?
100%. Government has always supported. There is absolutely nothing to worry about it.
Okay, sure. Thanks a lot.
Thank you.
Finally, I just wanted to you have seen Q1. You have seen the recorded highest revenue, EBITDA and PBT. I am very sure that with our unfailing focus on consumer quality, we will continue to grow ahead of the industry. The best range TVS has got Apache, Jupiter 125, iQube, Orbiter, Raider, NTorq, XL, Radeon, Ronin, TVS King, TVS King Kargo, and EV. We will continue to leverage the scale benefit, focus premiumization, real cost reduction. I'm pretty confident that we will continue to have this journey on EBITDA as well as the top-line growth. Thanks to our customers for helping us to cross HLX 5 million and 1 million iQube. I am confident that Q2 will be a much better quarter than Q1. Thank you.
Thank you so much, sir. On behalf of 360 ONE Capital Market Research, that concludes this conference. Thank you for joining us and you may now disconnect your lines.
Thank you.