Eicher Motors Surpasses Q4 Profit Estimates With Strong Royal Enfield Sales
The Indian automotive giant, Eicher Motors, has exceeded profit expectations, thanks in part to strong Royal Enfield sales and greater export volume
Royal Enfield remains a key component of Eicher Motors' business stratergy, with the historic motorcycle maker playing a big part in it surpassing its fourth-quarter profit estimates.
Per Reuters, Eicher Motors (EML) reported a net profit of 13.62 billion rupees (£120.14 million) for the quarter ended March 31, surpassing the average estimate of 12.68 billion rupees (£111,47 million) from 12 analysts, according to data from the LSEG (London Stock Exchange Group).
It goes on to say that it’s larger capacity bikes (350cc and above) which are at the heart of the strong performance. The Royal Enfield range is peppered with options in this lower mid-range segment, with bikes like the Meteor 350 offering a custom vibe and the Hunter 350 giving riders a more urban and sporty aesthetic. It’s also said that the new Himalayan 450 played a big part in the success, which, thanks to strong export results, helped to drive EML to a total revenue figure of 52.41 billion rupees (£460.89 million), up 23.2 per cent on the previous year.
Next year could again be a strong year for the Indian brand, with EML, thanks to the Royal Enfield sub-brand, Flying Flea, launching the company into the lucrative lightweight electric motorcycle sector. While sales of large capacity premium (read 'expensive') electric bikes are floundering, the A1 segment (125cc equivilent and below) is stronger, especially in the Asian region. If Royal Enfield pitches and prices its Fly Flea bikes accordingly, it could take a lot of sales from the established electric motorcycle makers.
And EML/Royal Enfield isn’t the only Indian motorcycle maker posting strong results, with the Norton parent company, TVS, also exceeding expectations. TVS reported profits which rose 75.5 per cent to 8.52 billion rupees (£74.97 million), with two-wheeler sales rising a reported 14 per cent with motorcycles making up nearly half of those sales.
It wasn’t all good news for the Indian motorcycle industry, with Hero narrowly missing expected results at the end of the fiscal year. Rising costs and a drop in sales volumes are reported to be behind the results.
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Simon (AKA Toad) has been working within the motorcycle industry for more than twelve years, and a member of the motorcyclist family since birth. Growing up around British-built single and twins, it was inevitable that a life on two wheels was on the cards, from a very early age!
