Eicher Motors Ltd.'s quarterly profit rose, beating estimates, as demand for its motorcycles began to improve.
Net profit of the maker of Royal Enfield motorcycles rose 57% sequentially to Rs 373 crore in the three months ended September, according to its exchange filing. That compares with the Rs 306-crore consensus estimate of analysts tracked by Bloomberg.
Highlights (QoQ)
Revenue rose 14% to Rs 2,249.6 crore, compared with the Rs 1,974-crore forecast.
Operating profit rose 30% to Rs 469.9 crore.
Operating margin increased to 20.9% from 18.4%.
Eicher Motors' sales improved marginally by 1.1% over the preceding quarter to 1.23 lakh units. Sales at its commercial vehicle unit, Volvo Eicher Commercial Vehicles, too, rose 90% to 15,134 units.
“With the market picking up over the festive season, consumer sentiment significantly improving over the year, we see that demand continues to be strong and outstripping supply,” Siddhartha Lal, managing director of Eicher Motors, was quoted as saying in a statement.
B Govindarajan, the company's executive director, said availability of parts is expected to improve from the third quarter of the ongoing fiscal.
Commercial Vehicle Business
The commercial vehicles business is expected to grow on pent-up replacement demand as well as from the construction and infrastructure sectors, according to Vinod Aggarwal, managing director and chief executive of VECV.
"With a strong product portfolio and focus on retail excellence, we are in a good position to continue our growth path," he said.
Shares of Eicher Motors closed 0.8% lower before the earnings were announced compared with a 0.4% gain fall in the benchmark S&P BSE Sensex.
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