While announcing the results last week, Mr Venu Srinivasan, chairman and managing director, felt the performance could have been better had the company introduced a variant to its successful motorcycle brand, Victor, in September 2003. "New variants are required at least once in two years. The product cycle has dropped from six years," he said.

The Victor, a four-stroke motorcycle with a 110-cc engine, was launched in September 2001. Over eight lakh Victors have been sold, and the company plans to introduce a 125-cc engine variant in April this year.

Not only do new products attract customers, they also improve the company''s realisation. "New products are clearly getting a better price," said Mr Srinivasan. Another benefit of new products is a "good topline."

Elaborating on changes in customers'' preferences, Mr Srinivasan felt that style had become an important factor in attracting customers. Consequently, executive segment motorcycles (roughly the Rs 35,000-Rs 45,000 range) required a "quicker facelift."

He attributed the decline in the third quarter profit to a combination of a rise in marketing expenditure and a fall in the sales of two-stroke motorcycles. He felt the launch of the Victor variant in April, and the introduction of a four-stroke motorcycle this month, Centra, would help the company improve its performance in the near future.