By BridgeNews Honda Motorcycle and Scooter India Ltd., a subsidiary of Japan's automotive giant Honda, has issued a Letter of Intent to India Nippon Electricals Ltd., a TVS group company, for supply of ignition systems. The Honda subsidiary proposes to launch a four-stroke scooter in India during the second half of calendar year 2001. The ignition systems are likely to be supplied from India Nippon's upcoming factory at Rewari in the northern Indian Haryana state, director K. Seshadri, said July 12. India Nippon is setting up the factory also to cater to the demand from two-wheeler manufacturers Hero Honda and Escorts. The company will initially invest 30 million rupees (US$671,291) in the facility, he said. The new factory would manufacture flywheel magnetos. Though India Nippon already had two plants, both of them were located in southern India and the company had to put up the Rewari plant to be close to the customers and also tap the northern market in a bigger way, Seshadri added. India Nippon, a joint venture of the TVS group with Kokusan Denki Co., an arm of Japan's Hitachi group, has a 40% market share in flywheel magnetos. It also has a 20% share in the market for ignition coils, control units, and rectifier units. India Nippon had reported a net profit of 119.1 million rupees (US$2.7 million) and sales of 979.9 million rupees (US$22 million) during 1999-00 (April-March). The company expects sales of 1.22 billion rupees (US$27.3 million) in the current fiscal, Seshadri said.