Eicher Motors Q2 net rises 4% to Rs 573 cr; Royal Enfield sales drop 22%

Eicher Motors on Friday posted 4.36 per cent increase in its consolidated net profit at Rs 572.69 crore for the second quarter ended September 30, 2019.

The company, which sells motorcycles under the Royal Enfield brand, had reported a net profit of Rs 548.76 crore in the July-September period of 2018-19.

Total revenue from operations, however, declined to Rs 2,192.47 crore for the second quarter as compared with Rs 2,408.17 crore in the same period of the previous fiscal, Eicher Motors said in a regulatory filing.

Royal Enfield sold 1,63,390 motorcycles in the quarter, a decline of 22 per cent from 2,09,963 motorcycles sold over the same period in the last financial year.

"Through the last few quarters, we have continued to invest for the long term by pursuing greater innovation, improving efficiencies, and making investments in different areas," Eicher Motors Ltd Managing Director Siddhartha Lal said.

The company remained focused on building greater accessibility for its consumers, through new variant launches and improving retail footprint, he added.

"These efforts are beginning to yield good results for us," Lal said.

The commercial vehicle industry continues to be challenging due to weak industry sentiments. However, VECV gained market share in second quarter despite decline in total industry volume, he added.

VE Commercial Vehicles (VECV) - the company's joint-venture with AB Volvo - continued to be affected by the demand slowdown.

Its PAT (profit after tax) for the second quarter declined 89 per cent to Rs 15 crore from Rs 142 crore recorded in the year ago period. Revenue from operations declined 32 per cent to Rs 2,004 crore as against Rs 2,966 crores in the same period last year.

VECV sold 11,370 trucks and buses in the quarter, a dip of 39.2 per cent over the same period last year.

"Even though our volumes have reduced, our decline has been a bit lower than the industry with a drop of 30 per cent in the first half and 39 per cent in the second quarter respectively," VECV CEO Vinod Aggarwal said.

Shares of Eicher were trading 1.13 per cent up at Rs 21,672 apiece on the BSE.