Japan's Honda Motor Corp's fully owned Indian bike unit expects to sell 2.1 million units in fiscal year 2012.

The Hero Honda joint venture is India's largest motorcycle manufacturer with more than half the domestic market. The company sold 1.43 million units in the December quarter, which is 28% more from a year earlier.

But the company now expects to grow at 30 percent and sell 1.65 million units in fiscal 2011, Shinji Aoyama, outgoing president and chief executive of Honda Motorcycle & Scooter India Pvt. Ltd said.

Earlier this month, Hero Investments agreed to buy Honda Motors' 26 per cent stake in Hero Honda Motors for around $851 million, with the Japanese automaker exiting its joint venture in India after more than 26 years.

Honda Motorcycle will invest Rs. 600 crore in the first phase of its second plant, which is expected to begin operating in the second half of 2011. "In order to minimize the gap with not only Hero Honda, but Bajaj too, we will have to expand capacity," Aoyama said.

Unlisted Honda Motorcycle, which made its entry in the popular 100cc bike segment in 2009, will launch a low-cost motorcycle in India soon, he said, but did not give a timeline.