Q2 Results: Eicher Motors’ Profit Misses Estimates
Eicher Motors Ltd.’s profit in the September-ended quarter missed analyst expectations as costlier raw material and higher employee benefits weighed on the maker of Royal Enfield motorcycles.
Net profit in the July-September period rose 5.9 percent over last year to Rs 549 crore, according to its stock exchange filing. That compares with Rs 580 crore consensus estimate of analysts tracked by Bloomberg.
Revenue rose 11.1 percent year-on-year to Rs 2,408.2 crore. Operating profit increased 6.9 percent to Rs 729.4 crore. Operating margin, however, narrowed to 30.3 percent from 31.5 percent a year ago.
Raw material costs rose 10.3 percent to Rs 1,206.6 crore. Employee benefits costs also increased 21.4 percent to Rs 176 crore.
Manufacturing at a Royal Enfield facility near Chennai had hit a snag since the last week of September after workers staged a walkout demanding higher pay. Due to the strike, Royal Enfield suffered a production loss of 25,000 motorcycles, it had said in an earlier filing.
The stock declined 2.33 percent ahead of the results announcement. Shares fell 15.4 percent during the July-September period.