Royal Enfield's parent Eicher Motors profit rises 62% in Q3 on handsome volumes

By Varun SinghEicher Motors, the parent company of the global mid-size motorcycle segment (250cc-750cc) leader Royal Enfield, today reported a growth of 62.5% year-on-year (y-o-y) in consolidated net profit at Rs 741 crore for three months to December 2022 on the back of handsome volumes.

The motorcycle volumes of Royal Enfield increased 31.15% at 219,898 units in Q3 FY23 from 167,664 units in the year-ago quarter. VE Commercial Vehicles (VECV), the joint venture between Eicher Motors and Sweden’s AB Volvo, recorded the highest-ever third-quarter sales at 18,162 units, a jump of 13.2% over 16,044 units sold in the corresponding quarter of the previous fiscal.

The revenue from operations rose 29.16% y-o-y at Rs 3,721 crore. The company’s operating margin climbed 283 basis points y-o-y at 23.03%, while the Ebitda (earnings before interest, tax, depreciation and amortization) was up 47.25% y-o-y at Rs 857 crore.

Source – Company

“The last few months have been extremely exciting for us at Royal Enfield as our new motorcycles, the Hunter 350, and the recently-launched Super Meteor 650, have been very successful and received an amazing response from experts and consumers across the globe. With these motorcycles, and with upcoming launches at Royal Enfield, we intend to bring a strong and compelling portfolio in the middleweight segment, which has immense growth potential in markets around the world,” said Siddhartha Lal, Managing Director, Eicher Motors.

“During the last quarter, we also stepped up our work in the EV space with a strategic investment in Stark Future. The team at Stark are hugely focused and passionate about disrupting the EV mobility space and we see immense synergies in this partnership,” he added.

In late December, Eicher Motors announced that it will invest 50 million euros (nearly Rs 444 crore) and acquire a 10.35% equity stake in Spain-based electric motorcycle manufacturer Stark Future. It has also nominated a director on the board of Stark Future and executed a technical collaboration agreement for research and development in electric motorcycles, technology sharing, technical licensing and manufacturing.

“At VE Commercial Vehicles as well, we recorded solid performance this quarter with strong sales and improved market share in the buses and heavy-duty trucks segment. We continue to remain focused on expanding our distribution and service network and deliver consistent uptime to our customers,” Lal said.

Eicher Motors Wholetime Director and Royal Enfield CEO B Govindarajan said that we have witnessed tremendous growth in the last quarter as we registered a 31% increase in wholesale and our second-highest retail for the festive season. “We also recorded our highest-ever market share in the motorcycle segment, with 8.1% during the quarter, and a close to 33% market share in the above 125cc segment. Recently, we launched our eagerly anticipated cruiser – the new Royal Enfield Super Meteor 650 – to a resounding response from consumers across the world,” he added.

The cruiser is being offered in two variants – Super Meteor 650 and Super Meteor 650 Tourer. It is priced between Rs 3.49 lakh and Rs 3.79 lakh (ex-showroom). Designed and developed at the UK Technology Centre in association with Harris Performance, the motorcycle is based on the 648cc twin platform and gets a new chassis.

“Taking our aspirations further to be a strong global consumer brand from India, we strengthened our foothold in overseas markets with the inauguration of our fourth international CKD in Brazil and also signed an MoU to set up CKD facilities in Nepal and Bangladesh. Another highlight for us this quarter was sharing the joy of motorcycling with more than 14,000 riders of our community at the annual festival Rider Mania in a brand new avatar of Motoverse,” Govindarajan said.