Eicher Motors clocks profit on steady growth across segments

by Autocar Pro News Desk , 11 Feb 2021

Eicher Motors’ Q3 FY2021 PAT (Profit after Tax) rose 6.81 percent year-on-year to Rs 533 crore (Q3 FY2020 profit at Rs 499 crore) on the back of steady growth across segments. Total revenue from operations was up 19 percent to Rs 2,828 crore YoY (Q3 FY2020 revenue from operation: Rs 2,371 crore).

Commenting on Eicher Motors’ performance, Siddhartha Lal, managing director said, “The third quarter has seen steady business growth and encouraging performance across the board. Consumer sentiment and demand have improved and this is reflected in our volumes for the quarter. At VECV, demand for commercial vehicles has been improving sequentially. At Royal Enfield as well, we saw encouraging pick-up in demand and bookings over the quarter.”

Royal Enfield records best-ever December sales
Royal Enfield’s Q3 sales rose 5 percent YoY to 199,000 (Q3 FY2020 sales at 189,000 motorcycles). It was an eventful quarter for the iconic bikemaker. It launched the Meteor 350, in India and across Europe, Thailand and Australia. It also launched its first flagship store in Tokyo, Japan, becoming the first Indian premium motorcycle brand to set up a standalone store in Japan. 

Speaking on Royal Enfield’s performance, Vinod K. Dasari, CEO said, “This quarter has been encouraging as we have exceeded pre-Covid production levels and had our best-ever December performance till date. While we have been able to stabilise our supply chain to some degree there are still a few issues with erratic supplies, as well as increase in logistics and commodity costs. The demand has been steady and our bookings have stayed strong for the entire quarter. With the launch of the Meteor 350 and the simultaneous debut of the Royal Enfield Tripper, Royal Enfield App and the Make It Yours initiative, we have created a whole new seamless interactive and immersive brand purchase and ownership experience. We have also witnessed healthy international market performance this quarter and are hopeful that the momentum will continue in the upcoming months as the market situation and consumer sentiment further improve.”

VECV gains market share
Group company VECV’s Q3 FY2021 revenue from operations increased by 23.9 percent to Rs 2,680 crores ( Q3FY2020 revenue: Rs 2,164 crore). It recorded a profit of Rs 58 crore in Q3 compared to Rs 30 crore in the same period last year. The EBITDA margin improved to 8.6 percent for the quarter against 6.4 percent during the corresponding quarter for the last year due to stringent cost reduction measures being undertaken.

Speaking on VECV’s performance Vinod Aggarwal, MD and CEO, VECV said “With clear signs of economic revival, the CV industry is on the recovery path. Based on that, it is heartening to note that the truck segment has grown in Q3 over the corresponding period in the previous year. Heavy duty trucks 18.5T and above grew by 13 percent in Q3 and light and medium duty trucks 5 to 16T grew by 16 percent.  However the bus segment continues to remain sluggish with a drop of 83 percent in Q3 as schools remain mostly closed and low inter-state movement of buses.”

In November last year, Volvo Bus India got successfully integrated with VECV. Aggarwal added that, “This integration will strengthen Volvo and Eicher’s Bus position in India through synergies in product development, purchasing and manufacturing with access to Volvo Group’s world class technology in buses. Further continuing our digital transformation journey, we continue to heavily invest in digitizing all our business-critical functions, from supply chain management to customer experience.”

VECV sales declined by 38 percent compared to an average CV industry decline of 52% YTD till December 2020. According to the company, strengthened customer connect initiatives and strong market acceptance of the BS VI range has helped the compamy gain market share across segments of LMD, HD and Bus.”