Eicher Q4 net up marginally at Rs 462 cr, hit by EEPL closure

Eicher Motors today reported a marginal increase in its consolidated net profit at Rs 462 crore for the fourth quarter ended on March 31, hit by one time loss of Rs 187 crore due to the closure of Eicher Polaris Pvt Ltd (EEPL), its 50:50 joint venture with US-based Polaris Inc.

The company had reported a net profit of Rs 459 crore during the same period of 2016-17.

"Our net profit for the fourth quarter grew by just Rs 3 crore as a result of one time impairment we had to take due to the closure of EEPL," Eicher Motors MD and CEO Siddhartha Lal said in a conference call.

The company took a hit of Rs 187 crore due to the closure of EEPL, he added.

On March 9, 2018, the EPPL board had decided to wind down the operations of the company.

The company's profit after tax from continuing operations (PAT) stood at Rs 649 crore for the fourth quarter, up 38 per cent, from Rs 470 crore in the same period of 2016-17.

Eicher's revenue from operations stood at Rs 2,528 crore for the fourth quarter as against Rs 1,888 crore for the same period of the previous fiscal.

For the year ended March 31, the company posted a net profit of Rs 1,960 crore as against Rs 1,667 crore during the 2016-17 fiscal.

Revenue from operations for the year stood at Rs 8,965 crore for the fiscal ended March 31, 2018. It stood at Rs 7,033 crore in 2016-17.

Eicher, which has earmarked a capex of Rs 800 crore for the current financial, reported best ever performance by Royal Enfield during the fourth quarter.

The niche bike maker, which is a part of Eicher Motors, sold 2,26,907 motorcycles during the quarter, a growth of 27 per cent over 1,78,345 bikes sold in the same period last year.

Royal Enfield also posted its highest ever quarterly revenue from operations at Rs 2,528 crore for fourth quarter, a growth of 34 per cent over the corresponding period last year.

For 2017-18, the company sold a total of 8,20,121 units, a growth of 23 per cent, from 6,66,135 units in 2016-17.

"While we launched several relevant and differentiated variants, the highlight of the year was the unveiling of our first modern twin cylinder motorcycles - Interceptor 650 and the Continental GT 650," Lal said.

These motorcycles have created quite an excitement both in emerging as well as developed markets and once launched, they will grow the middleweight segment globally, he added.

Elaborating on capex for the fiscal, Lal said, the company will invest Rs 800 crore during the fiscal in all areas of its business including second phase of the company's third plant at Vallam Vadagal near Chennai.

Besides, the company would be investing in the construction of a technology centre in Chennai this year, new product development to meet upcoming regulations and to expand Royal Enfield's portfolio for its global markets, Lal said.

The planned capacity for 2018-19 is 9.5 lakh units, he added.

Lal said that to further strengthen the brand and to accelerate market development activities, the company has decided to set up wholly owned subsidiaries in Indonesia and Thailand in the current fiscal.

Commenting on performance of VE Commercial Vehicles (VECV), Lal said the company posted a net profit of Rs 177 crore for the fourth quarter, as compared with Rs 117 crore in the same period of previous fiscal.

The company, which is a 50:50 joint venture between Eicher and Volvo, posted revenue from operations at Rs 3,317 crore as against Rs 2,554 crore in the same period of 2016-17.

"Towards driving modernisation in the CV industry, VECV will be investing Rs 500 crore in 2018-19 in all areas of its business. With the upswing in the CV industry our latest range of modern Pro-Series trucks will be able to grow its market share further in the coming months," Lal said.

Eicher's board, which met today, recommended a dividend of 1,100 per cent, Rs 110 per equity share of face value of Rs 10 each for the financial year ended March 31, 2018.

Shares of the company today ended 0.43 per cent down at Rs 30,305.45 apiece on the BSE.