Eicher Motors Q4 results | Consolidated net profit up 34% QoQ at Rs 610 crore; revenue grows to Rs 3,193 crore

For the full year, from April 2021–March 2022, PAT jumped 25 percent to Rs 1,677 crore from Rs 1,347 crore in FY21.

Consolidated revenues rose by 18 percent to Rs 10,298 crore from Rs 8,720 in the previous financial year.

The growth was led by YoY increase in average selling prices (ASPs) due to a richer model mix and price hikes taken over the past few quarters. This, however, was partly offset by YoY decline in volumes for Royal Enfield.

However, Royal Enfield registered record volumes in exports markets for the year marking a growth of over 108 percent over FY21.

“The year gone by was very significant for Eicher Motors Limited, as we registered considerable progress towards our long term strategic business vision”, said Siddhartha Lal, Managing Director, Eicher Motors Ltd.

“Over the last eight years, we have made concerted efforts in becoming a premium, global player, concentrating on some of the toughest motorcycle markets in the world, with an ambition to sustainably grow our overseas presence and business”, Lal added.

Volumes

During the quarter, Royal Enfield recorded sales of 182,125 motorcycles, down by 10.4 percent from 203,343 motorcycles sold during the same period last year.

During FY22, Royal Enfield registered motorcycle sales at 595,474, down 2.3 percent from 609,403 in FY21.

“We continued to deliver on our global focus with unprecedented growth and strengthened our international operations with the setting up of two CKD facilities this year, in Colombia and Thailand, and expanding our global retail network to close to 3000 stores during the year” said B. Govindarajan, CEO - Royal Enfield and Wholetime Director.

“Our consistent efforts to unlock the potential of fostering a pure motorcycling ecosystem has resulted in a 45 percent year-on-year growth in our non-motorcycling business backed by razor sharp focus on growing service and spares business, as well as our motorcycle apparel and accessories business”, Govindrajan added.

Volvo Eicher Commercial Vehicles

The revenue from operations for the company’s joint venture with Volvo came in at Rs 12,724 crores, up by 46.7 percent over the previous year’s revenue of Rs. 8,676 crores. Profit after tax for the business stood at Rs 111 crores as against Rs 57 crores during last fiscal. The business recorded sales of 57,077 vehicles for FY22, up 38.3 percent over 41,268 vehicles in FY21.

“Despite the challenges posed by two waves of the Covid pandemic, supply chain disruptions caused by lockdowns and the situation in Ukraine, VECV registered handsome growth both in volumes as well as total Income” said Vinod Aggarwal, MD and CEO VECV. Sales of trucks and buses grew by 38.3 percent to 57,077 units during FY22.

“Our new truck plant at Bhopal became fully operational that puts us in a good situation as far as capacity is concerned and we are well placed to take advantage of the expected growth in the industry, supported by our award winning range of products”, Aggarwal added.

Costs

The lower volumes led to decrease in raw material costs as a percentage of revenue from operations to 57 percent compared to 61 percent during the corresponding period last year. The raw material costs however are higher compared to the preceding quarter when they had stood at mere 49 percent of revenue from operations due to significant decline in volumes.

Employee costs dipped marginally by 100 bps on year to 7 percent of revenue from operations. On a sequential basis, the employee costs were stable.

Other expenses on the other hand picked up 100 bps from last year to 13 percent and were stable on a sequential basis.

Dividend

The company approved a dividend of Rs 21 per equity share of face value of Re 1 each for the financial year ended March 31, 2022.

Eicher Motors, gained Rs 48 or 2 percent to close at Rs 2,432.65 on May 13, at The National Stock Exchange. The stock has been trading flat over the past one year and is down marginally by 2.4 percent over the past one week.