The auto maker's consolidated net profit declined 6.42% to Rs 498.70 crore in Q3 December 2019 (Q3 FY20) as against Rs 532.95 crore reported in Q3 December 2018 (Q3 FY19).
Net sales rose 0.95% year-on-year (Y-o-Y) to Rs 2,350.45 crore in Q3 FY20. The Q3 figures were declared during trading hours today, 6 February 2020.
Profit before tax slumped 18.40% to Rs 644.09 crore Y-o-Y. Total tax expenses dropped 43.30% to Rs 145.39 crore during the period under review.
Earnings before interest, tax, depreciation and amortization (EBITDA) fell 13% to Rs 592 crore in Q3 FY20 as against Rs 680 crore in Q3 FY19.
Commenting on the automobile major's Q3 performance, Siddhartha Lal, the managing director of Eicher Motors, has said that, We've remained focused on our long term strategy. We have improved our retail network to bring in further accessibility. We've worked on transitioning our product portfolio to comply with the new BS-VI emission norms and also launched the new Royal Enfield Himalayan BS-VI. The 650 Twin motorcycles continue to enthrall global audiences, as the Interceptor 650 has been awarded 'Bike of the Year' by Motorcycle Cruiser magazine and Continental GT 650 has received 2019 best looking Naked / Standard Motorcycle of the year from Motorcyclist Magazine, both leading publications in the USA. While the commercial vehicle industry continues to face challenges due to slowdown, VECV remained profitable despite a sharp decline in its volume."
Meanwhile, Royal Enfield registered a 2% decline in sales to 1.89 lakh unit motorcycles in Q3 December 2019 from 1.93 lakh unit motorcycles in Q3 December 2018 sold. Royal Enfield continues to strengthen its distribution network in India and across the world. During the last quarter, Royal Enfield added 7 new large format stores and 250 new Studio Format stores in India, taking the total to 1,400 retail touchpoints. In international markets, Royal Enfield added new stores across Thailand, Brazil, Argentina, France and the UK, increasing its overall touchpoints to about 675 stores including 67 exclusive stores. This network expansion, combined with sustained Brand and Marketing initiatives, have more than tripled sales outside India.
During Q3 December 2019, VE Commercial Vehicles' (VECV) revenue from operations slumped 23% to Rs 2,164 crore in Q3 December 2019 from Rs 2,818 in Q3 December 2018. The EBITDA also tumbled 28% to Rs 133 crore in Q3 December 2019 as compared to Rs 186 crore in Q3 December 2019. The profit after tax tanked 60.52% to Rs 30 crore over Rs 76 crore in Q3 December 2018. VECV sold 12,391 trucks and buses during the quarter, recording a decline of 27% Y-o-Y, from 16,936 trucks and buses sold over the same period in the last financial year.
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Throwing light on VECV's performance, Vinod Aggarwal, the managing director and CEO of VECV, has said that, With industry showing no signs of recovery except for some pre-buying, this is one of the worst phases for the CV industry. Our focus on long term initiatives is continuing and we are optimistic that the industry will start growing after some time largely led by investments in infrastructure. At the same time, we are bringing a sharp focus to cost management and improving productivity.
It is a matter of great satisfaction that we have improved overall market share. Our recently launched new range of Eicher Pro2000 series has received a very good response from customers who are able to earn even greater profits with higher fuel efficiency and increased revenue due to extended running of those vehicles made possible with advanced features. Based on customer demand we have expanded the range in Pro2000 series which is now available from 4.9 to 14 ton LMD trucks.
On BS-VI readiness, we are all set to introduce BS-VI products. We have a relative advantage in BS-VI scenario given our years of experience in handling Euro 6 technology as we are supplying Euro 6 compliant base engines to Volvo Group for more than six years, he added.
Eicher Motors is a parent of Royal Enfiled that offers middleweight motorcycles in India. Royal Enfield operates in India, and over 40 countries around the world. The firm is engaged in manufacturing automobile products and related components. The company operates in business verticals, including motorcycles, commercial vehicles and personal utility vehicles.
The board on Thursday, 6 February 2020 has re-appointed S. Sandilya and Manvi Sinha as independent directors of the company with effect from Thursday, 13 February 2020 for a period of 5 consecutive years each.
Shars of Eicher Motors soared 5.20% to Rs 20,495.95 on BSE. The stock hovered in the range of Rs 20,530 to Rs 19,250 so far.
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