UPDATE 1-TVS Motor sees 15-20 pct rise in FY09 2-wheeler sales

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NEW DELHI, July 7 (Reuters) - TVS Motor (TVSM.BO: Quote, Profile, Research) sees two-wheeler sales up by as much as a fifth in 2008/09, following a lacklustre year, helped by wider offerings and as higher oil prices encourage sales of fuel-efficient bikes, an official said.

But H.S. Goindi, head of marketing, TVS Motor, said on Monday the firm would raise prices in the year to offset some of the rise in raw material prices.

TVS, India's third biggest motorcycle maker, sold 1.29 million two-wheelers in the country and abroad in the year to March 2008, about 16 percent below the previous 12-month period. The decline was due to falling bike sales in the domestic market.

"We now have a complete portfolio. That is the fundamental reason," H.S. Goindi, head of marketing, told reporters, refering to new models launched by the firm.

"The industry will grow 10-15 percent this year," he said at the launch of a new 160-cc bike model. "As far as TVS is concerned, we will grow 15-20 percent."

Goindi also said a 10 percent rise in state-set retail fuel prices in June would be positive for the industry, as customers would favour the fuel-efficient motorcycle over other options in the time of soaring inflation.

"Inflation will have an effect on the economy, but as two- wheelers have lower operating costs, as oil goes up we have a better chance," Goindi said.

He said the firm was considering raising prices of its offerings, "over a period of time," but did not say by how much.