The New Delhi-based automaker's consolidated net profit rose 20% on year to Rs 1,101.5 crore. The share of profit from the VECV was Rs 174.6 crore, up from Rs 100 crore.
08 Aug 2024 | 6299 Views | By Kiran Murali
Despite weakness in volumes, Eicher Motors Ltd reported a 20% on-year growth in its net profit for the first quarter of the current financial year. Revenue, operating profit and net profit are at an all-time high.
Improvement in the average selling price with a richer mix of products and ...
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Despite weakness in volumes, Eicher Motors Ltd reported a 20% on-year growth in its net profit for the first quarter of the current financial year. Revenue, operating profit and net profit are at an all-time high.
Improvement in the average selling price with a richer mix of products and price hikes, a higher share of profit from the Volvo Eicher Commercial Vehicles joint venture and moderation in input cost inflation drove the net profit during the quarter.
Eicher Motors' consolidated net profit came in at Rs 1,101.5 crore, against Rs 918.3 crore in the year-ago period. The share of profit from the VECV was Rs 174.6 crore, up from Rs 100 crore.
The New Delhi-based company sells motorcycles under the Royal Enfield brand. It also sells trucks and buses under Eicher and Volvo brands through VECV, the joint venture between Eicher Motors and Volvo Group.
"After a strong performance in FY24, we have started this year on a confident note, registering our best ever quarterly financial performance with both Royal Enfield and VECV reporting steady growth," Managing Director Siddhartha Lal said.
Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA), or operating profit rose 14% to Rs 1,165 crore while the operating profit margin expanded to 26.5% from 25.6% in the year-ago period, as per our calculation.
The company's revenue from operations totaled Rs 4,393.1 crore, up 10% from the comparable period. The revenue growth reflects a better mix of products and higher prices as volumes were almost flat during the quarter.
Royal Enfield's total wholesales were at 2,27,736 motorcycles, compared wtih 2,25,368 motorcycles in the year. "This quarter has been particularly notable for our performance in the international markets," said Royal Enfield CEO B Govindarajan.
Eicher Motors' total expenses increased 9.3% to Rs 3,408.5 crore as the cost of raw materials and components used rose 4% to Rs 2,343.9 crore.
Meanwhile, VECV's revenue from operations rose just by 1.8% on year to a record Rs 5,070 crore while its EBITDA declined slightly to Rs 385 crore from Rs 387 crore. However, the joint venture's profit after tax jumped to Rs 319 crore from Rs 181 crore in the corresponding period last year.
Profit after tax jumped despite the decline in operating on account of a one-time gain arising from the write-back of a deferred tax.
VECV sold 19,702 trucks and buses, compared with 19,571 units in the year-ago period. Eicher-branded truck and bus sales came in at 19,287 units, up 1.5%, while Volvo truck and bus sales fell 27% to 415 units.