Hero Moto Q4 net down 5% to Rs 574cr; beats street
India's largest two-wheeler maker Hero MotoCorp's fourth quarter (January-March) net profit fell by a lower-than-expected 5 percent year-on-year to Rs 574.3 crore.
April 27, 2013 / 16:32 IST
Moneycontrol Bureau
Hero MotoCorp's fourth quarter net profit declined a lower-than-expected 5 percent year-on-year to Rs 574. Its revenue for the three-month period was also above street estimates, rising 2 percent from a year ago to Rs 6,146 crore.Analysts on average had expected the India's largest two-wheeler maker to report a net profit of Rs 493 crore on revenue of Rs 6,020 crore, according to a CNBC-TV18 poll.Hero's EBITDA margin in the quarter improved to 13.83 percent. Margins had it a two-year low of 12.6 percent in Q3. The two-wheeler sector has been hit by sluggish demand over last one year as customers have cut back on discretionary spends amid an overall economic slowdown and high inflation.Hero's total two-wheeler sales in Jan-March declined 3 percent to 15.27 lakh units. For the full year, its sales also fell close to 3 percent to 60.76 lakh units.The company says FY13 was a challenging year for the sector and is cautiously optimistic of the near-term prospects."FY13 has been a rough year for the overall Indian auto sector. Weak macro economic sentiment coupled with subdued consumer confidence adversely impacted the industrial growth and sales volumes. Considering the current environment, these are tough times for the auto sector in India and we remain cautiously optimistic about the growth prospects in the near-term," said Pawan Munjal, MD and CEO.Being the industry leader, the company has planned "major initiatives" to boost industry sentiment and accelerate growth this financial year through new launches, campaigns, capacity addition and network expansion, Munjal added.Hero is setting up its fourth plant at Neemrana in Rajasthan and a fifth unit will come up in Gujarat. It is also setting up a global parts centre at Neemrana and an integrated research and development centre at Kukas, Jaipur, apart from expanding capacities at existing plants. The total investment planned for these ventures is over Rs 2,500 crore.Meanwhile, the maker of Splendor, Passion motorcycles and Pleasure, Maestro scooters has increased prices across its brands. The price hike will be in the Rs 500-1,500 range and will come into effect immediately, it said. Hero Moto shares closed down 1.3 percent at Rs 1,596.85 on NSE on Friday. The results were announced after markets closed.Nachiket Kelkar
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