Hero MotoCorp on Tuesday said its consolidated profit after tax (PAT) declined by 30 per cent to Rs 621 crore for the fourth quarter ended March 2022 on account of lower sales.
The country’s largest two-wheeler maker had reported a PAT of Rs 885 crore in the January-March quarter of 2020-21 fiscal.
Revenue from operations declined to Rs 7,497 crore as against Rs 8,690 crore in the fourth quarter of FY21, Hero MotoCorp said in a regulatory filing.
The company’s total sales in the fourth quarter of FY22 stood at 11.9 lakh units, a drop of 24 per cent from 15.68 lakh units in the year-ago period.
For the 2021-22 fiscal, the company reported a consolidated PAT of Rs 2,329 crore, down 21 per cent from Rs 2,936 crore in 2020-21.
Revenue from operations dropped to Rs 29,551 crore from Rs 30,959 crore in FY21.
"With the economy picking up, we expect the demand for motorcycles and scooters to see a positive turnaround in the coming months. While concerns related to high input costs continue to remain a challenge, we will keep monitoring the situation and take judicious measures as appropriate,” Hero MotoCorp CFO Niranjan Gupta noted.
The forecast of a normal monsoon is likely to aid the crops, which in turn is expected to improve cash flows in the rural sector, he added.
"All these factors are likely to help in a steady recovery in consumer sentiments and market demand,” Gupta stated.
In FY23, the company has lined up multiple product launches in different segments with an aim to continue building its premium portfolio as well as premiumisation of existing models, which will help deliver growth and profitability, he added.
"In the coming months, the company will be able to drive profitable growth through the combination of key strategic initiatives such as acceleration of Leap-II savings program to offset the higher commodity prices and input costs and cash flow management,” Gupta noted.
The company said its board has recommended a final dividend of Rs 35 per share of face value of Rs 2 each (1,750 per cent).
The dividend, if approved at the ensuing AGM, will be paid by September 8, 2022.
Hero MotoCorp further stated that the Income Tax Department conducted a search activity on the company in March 2022 under Section 132 of the Income Tax Act.
Subsequently, the company has provided all support and cooperation and the necessary documents and data to the IT department, it added.
"The company is examining and reviewing the details of the matter and will take appropriate actions, including addressing regulatory actions, if and when they occur,” the two-wheeler major said.
While uncertainty exists regarding the outcome of the proceedings by the department, the company, after considering all available information and facts as of date, has not identified the need for any adjustments to the current or prior period financial results, it added.
The company also said Vikram Kasbekar has been re-appointed as whole-time director, designated as Executive Director – Operations (Plants), for a term of two years with effect from August 8, 2022 up to August 7, 2024.This is subject to the approval of shareholders at the ensuing Annual General Meeting (AGM) on August 9, 2022.