has come out with its second quarter (July-September) earnings estimates for the Automobiles sector. The brokerage house expects Hero MotoCorp
to report net profit at Rs 913.1 crore, up 3.5 percent quarter-on-quarter.
Net Sales are expected to increase by 5.5 percent Q-o-Q (up 14.2 percent Y-o-Y) to Rs 7807.3 crore, according to Centrum.
Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to rise by 4 percent Q-o-Q (up 18 percent Y-o-Y) to Rs 1278.6 crore.
Centrum's report on Hero MotoCorp
During the quarter, the company registered strong volume growth of 16% YoY and 4% QoQ. Overall volume during the quarter stood at 1,823,498 units. We believe the volume growth was largely driven by strong rural demand and new launches in scooter segment.
We expect recurring PAT of Rs9.1bn, up 18% YoY / 4% QoQ. We continue to maintain Hold rating on the stock, with a TP of Rs3,250 (16x Fy18E EPS).
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