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Eicher Motors Q1 Review - Supply-Chain Issues Impacting Volumes, Model Launches: Prabhudas Lilladher

Eicher Motors Q1 Review - Supply-Chain Issues Impacting Volumes, Model Launches: Prabhudas Lilladher

Eicher Motors Ltd.’s Royal Enfield Classic Chrome, foreground, and Royal Enfield Desert Storm, right, motorcycles stand on display at the company’s Royal Enfield flagship dealership in Gurgaon. (Photographer: Prashanth Vishwanathan/Bloomberg)
Eicher Motors Ltd.’s Royal Enfield Classic Chrome, foreground, and Royal Enfield Desert Storm, right, motorcycles stand on display at the company’s Royal Enfield flagship dealership in Gurgaon. (Photographer: Prashanth Vishwanathan/Bloomberg)

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Prabhudas Lilladher Report

Eicher Motors Ltd.’s Q1 FY22 standalone revenue declined 35% QoQ to Rs 19.1 billion (our estimate: 18 billion).

Realisation/volume came in at 8%/down 35% QoQ. Higher share of exports, mix improvement and price hikes led to growth in realisations.

Standalone margins came in at 17.5% (22.9% in Q4 FY21, our estimate 20.8%) impacted by lower scale of operation and higher fixed cost.

Eicher Motors has reiterated its aggressive stance of new product launches, though supply challenges may play a spoil sport in near term.

After series of delays, company is expected to launch new classic 350 by this month end.

We turn cautious on the stock given-

  1. saturation in key markets of Kerala and Chandigarh and

  2. price rise impacting vehicle affordability.

Click on the attachment to read the full report:

Prabhudas Lilladher Eicher Motors Q1FY22 Result Update.pdf

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