Eicher Motors Beats Street in Q4 Despite Chennai Floods, Shares Soar

Eicher Motors beat profit estimates in the December quarter despite suffering production losses on account of Chennai floods. 

The Gurgaon-headquartered company, which makes the Royal Enfield motorcycles and has a partnership with global auto giant Volvo for manufacturing commercial vehicles, posted a consolidated net profit of Rs 271 crore on net revenues of Rs 3,248 crore in its fourth quarter. 

"Royal Enfield continued with its strong performance in Q4 despite being effected by one of the worst floods in Chennai in the last two months of 2015. We lost production of 11,200 motorcycles due to our manufacturing facilities being disrupted by the flood," said Siddhartha Lal, managing director & CEO of Eicher Motors. 

For the full year (2015), Eicher sold 452,759 Royal Enfield motorcycles, registering a growth of nearly 50 per cent over 2014. EBIT or operating margin in the motorcycle business jumped to 25.2 per cent in 2015 over 22.5 per cent for the twelve-month period in 2014, the company said. 

Earlier this month, Royal Enfield introduced its new Himalayan motorcycle, which will go on sale in mid-March 2016. 

The commercial vehicles business also posted strong numbers, with sales of Eicher trucks and buses rising 33.5 per cent in Q4 against 19 per cent growth in the industry. 

"We continue to beat the industry and have gained market share in overall commercial vehicles industry," said Mr Lal. 

Eicher Motors shares closed 7.25 per cent higher at Rs 18,119.15, outperforming the broader market, which closed with 1.14 per cent gains.