Eicher Motors is expected to report double-digit growth in revenue as well as operating income driven by Royal Enfield business for the quarter ended December 2020. Profit growth could be in single digit, but operating profit margin may contract on a year-on-year (YoY) basis on higher commodity prices. The company will release quarterly numbers on February 10.
"Revenue are expected to grow 21.2 percent, driven by rise in volumes and 15 percent increase in realisations. Volume growth has been supported by healthy order-book and ramp-up in production," said Emkay Global which expects 6.5 percent YoY growth in profit
Eicher Motors recorded 9 percent growth in Royal Enfield's volumes at over 1.99 lakh units and around 3 percent growth in VECV volumes at 12,800 units in Q3 FY21.
Prabhudas Lilladher also expects Eicher to report consolidated revenue growth of around 21 percent YoY.
At the operating level, Kotak Institutional Equities expects consolidated EBITDA to increase by 20 percent YoY led by recovery in performance of Royal Enfield in Q3 FY21. "We also expect strong sequential improvement in VECV's performance in Q3 FY21 led by a recovery in the commercial vehicle cycle."
But despite the better scale, the EBITDA margin is likely to contract 58 bps on higher commodity prices, Emkay Global said.
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