Shares of Eicher Motors Ltd, the maker of Royal Enfield motorcycles, rose as much as 7% in intraday trade on Friday after the company reported robust earnings for the March quarter.
The automaker's stock opened at ₹3,520 apiece against its previous closing price of ₹3,405.30 on the National Stock Exchange (NSE). The counter touched a high of ₹3,647.50, taking the company's total market cap to ₹98,065 crore.
Net profit of Eicher Motors soared 48.4% year-on-year to ₹905 crore during the fourth quarter of 2022-23 compared with ₹610 crore in the corresponding period a year ago.
The company registered its highest-ever quarterly revenue from operations at ₹3,804 crore, up 19.1% as compared to ₹3,193 crore in the corresponding quarter of FY22.
Earnings before interest, taxes, depreciation, and amortisation (EBITDA) stood at ₹934 crore, up 23.3% as compared to ₹757 crore in the same quarter of the previous financial year.
According to ICICI Securities, Eicher Motors' gross margin improved 120 basis points quarter-on-quarter, driven by a combination of commodity cost tailwinds, the trickling effect of price hikes taken in Q3 FY23, product mix benefit and cost-saving initiatives.
During the quarter, Royal Enfield recorded sales of 214,685 motorcycles, up 17.9% from 182,125 motorcycles sold during the same period in FY22.
With chip issues getting sorted, OBD-2 transition being done, Royal Enfield is looking forward to continuing to deliver strong 'industry-beating growth' in FY24, and improve on its overall bike market share from currently around 7%, the brokerage says in a note.
The board of the company recommended a final dividend aggregating to ₹1,011.88 crore (34.7% of PAT) at ₹37 per share for the financial year ended March 31, 2023. The dividend per share is the highest ever for Eicher Motors and is 76.2% higher than the FY22 pay out.
Eicher Motors' board also approved a cash outlay towards capex of ₹1,000 crore for FY24, which also includes the investment towards EV manufacturing facility and product development and new product development under the Internal Combustion Engine portfolio.
"The world has settled into a 'new normal' after two years of chaos and uncertainties that kept throwing business out of gear. In line with that, this was an outstanding year for Eicher Motors Ltd. We saw overall stabilization of supply chain, markets, and also the organization, and made significant progress on all important initiatives resulting in our best ever business and financial performance, both at Royal Enfield and VE Commercial Vehicles," said Siddhartha Lal, managing director, Eicher Motors.
VE Commercial Vehicles (VECV) registered its highest-ever sales, and revenue and made strong market-share gains across segments, Lal said. VECV recorded its highest-ever quarterly revenue from operations at ₹6,200 crore, up 43.9% from ₹4,307 crore in the corresponding period last fiscal. Profit rose 222% to ₹319 crore in Q4 from ₹99 crore in the year-ago quarter. During the quarter, VECV recorded the highest-ever quarterly sales of 26,376 units, up 31.3% from 20,093 units sold during the same period last year.
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