Eicher Motors Q3 Results: Profit Falls, Realisation Improves
An Eicher Motors Ltd. Royal Enfield Desert Storm motorcycle stands on display in Gurgaon, India. (Photographer: Prashanth Vishwanathan/Bloomberg)

Eicher Motors Q3 Results: Profit Falls, Realisation Improves

Eicher Motors Ltd.’s third-quarter profit fell in line with estimates amid a slowdown in the auto sector. Realisation improved 10 percent year-on-year.

Net profit of the Royal Enfield maker fell 6.3 percent year-on-year to Rs 499 crore in the three months ended December, according to the automaker’s exchange filing. That compares with Rs 503 crore that analysts surveyed by Bloomberg had forecast.

Revenue rose 1.2 percent on a yearly basis to Rs 2,371 crore, driven by higher realisation. Analysts had pegged the top line at Rs 2,383 crore. The automaker’s realisation stood at Rs 1,21,477 per unit during the December quarter compared to Rs 1,10,736 per unit in the year-ago period.

The company sold 1,82,791 units of motorcycles between October and December, a decline of 6 percent from a year earlier. Its subsidiary VE Commercial Vehicles Ltd. sold 12,391 units during the quarter, a drop of 26.8 percent from the year-ago period.

“While the commercial vehicle industry continues to face challenges due to slowdown, VECV remained profitable despite a sharp decline in its volume,” Siddhartha Lal, managing director of Eicher Motors, said in a separate media statement.

We’ve remained focused on our long term strategy. We have improved our retail network to bring in further accessibility. We’ve worked on transitioning our product portfolio to comply with the new BS-VI emission norms and also launched the new Royal Enfield Himalayan BS-VI.
Siddhartha Lal, MD, Eicher Motors

Operating profit or earnings before interest, tax, depreciation and amortisation fell 12.9 percent year-on-year to Rs 592 crore—the estimate was Rs 606 crore. The company’s operating margin contracted to 24.96 percent during the period from 29 percent in the year-ago period—analysts had forecast margin at 25.4 percent.

Shares of Eicher Motors rose as much as 5.9 percent to Rs 20,641.60 after the results announcement. The stock advanced has 26.7 percent between October and December compared with the NSE Nifty Auto Index’s 10 percent gain.

Eicher Motors Q3 Results: Profit Falls, Realisation Improves

Eicher Motors Q3 Conference Call Highlights

  • Royal Enfield exports doing really well
  • Market share improved to 32 percent from 26 percent
  • Added 10 new stores during the quarter
  • BS-VI variants of Bullets will be launched this month
We are ready for BS-VI products. Sequentially we are showing growth and hope this trend continues going forward.
Vinod Dasari, CEO, Royal Enfield
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