Hero MotoCorp, India's biggest motorcycle maker, on Monday said that it notched up its highest-ever quarterly net profit on account of record sales. Shares in the company hit their 52-week high of 3,556 today.
Gurgaon-based Hero MotoCorp posted a net profit of Rs 883 crore and gross sales of Rs 8,011 crore in the June quarter. The two-wheeler manufacturer was seen posting a net profit of Rs 843 crore, according to analysts polled by NDTV Profit.
Hero MotoCorp's higher profitability was driven by a 6 per cent year-on-year growth in two-wheeler sales, with total number of units sold rising to 17,45,389 in the June quarter versus 16,45,240 in the corresponding quarter last year.
The company also beat margin estimates, with EBITDA or operating margin rising to 16.6 per cent in Q1. Domestic brokerage Religare Securities said Hero's margin beat was led by 170 basis points reduction in other expenses.
Pawan Munjal, chairman, managing director and CEO of Hero MotoCorp, said, "With the above-average monsoon so far and the implementation of the 7th Pay Commission recommendations, we remain cautiously optimistic about the remaining months of FY'17."
Religare Securities, which has a "buy" call on Hero MotoCorp, said it is in the process of revising its current target price (Rs 3,500) on the stock.
Hero MotoCorp shares closed 0.4 per cent higher at Rs 3,457.35 today. The stock rose in line with the broader Nifty50 index that gained 0.32 per cent.
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