TVS Motor Co., India’s third-largest motorcycle maker, plans to spend as much as 1.5 billion rupees ($32 million) to add capacity and develop new products this financial year as demand increases.

The company will boost maximum production of motorcycles, scooters and mopeds by 17 percent to 2.8 million units a year by March, S.G. Murali, executive vice president, finance, said by phone yesterday. Three-wheeler capacity will rise 80 percent to 90,000 units at the Chennai-based company, he said.

TVS Motor in November unveiled an automatic Jive motorcycle and Wego scooter, spurring sales, as economic growth and higher disposable incomes boost consumer spending in the world’s biggest market for motorcycles after China.

“A huge middle class, double-income families in larger towns and people requiring mobility point to a huge growth in the market,” said Murali. “There is enough money in the rural market with government spending on infrastructure.”

The company, including units, reported profit of 335.2 million rupees in the year ended March 31 after posting losses in the previous two financial years, according to its website. Murali declined to say how much he expects profit to grow in the current financial year.

http://www.businessweek.com/news/2010-08-17/tvs-motor-to-spend-32-million-adding-capacity-to-meet-demand.ht