TL;DR
Royal Enfield is investing Rs 958 crore to expand its Cheyyar plant, increasing annual motorcycle production capacity to 2 million units amidst growing demand.
Royal Enfield, a prominent Indian motorcycle manufacturer, is set to significantly increase its production capabilities with a substantial investment of Rs 958 crore. This capital infusion, approved by parent company Eicher Motors, will fund a brownfield expansion at its Cheyyar manufacturing facility in Tamil Nadu. The expansion aims to boost the brand's annual production capacity to 20 lakh (2 million) motorcycles, a 37% increase from its current 14.6 lakh units.
The capacity enhancement will be implemented in phases, with initial ramp-up expected in the first quarter of fiscal year 2026-27 and full completion targeted by fiscal year 2027-28. This strategic move comes as Royal Enfield's existing facilities operate at near-full utilization, driven by strong demand in both domestic and international markets. The entire investment will be financed through internal accruals, underscoring Eicher Motors' robust financial health and cash generation. Leveraging existing infrastructure at Cheyyar is expected to streamline execution and optimize capital efficiency, positioning Royal Enfield to support future product launches and expand its global presence in the mid-size motorcycle segment.
