Customers look at a Hero MotoCorp showroom in Ahmedabad (Photo: Reuters)
Impacted by lower volumes and liquidation of BS III stocks, Hero MotoCorp, the country's biggest two wheeler maker, reported a 14% decline in profit for the fourth quarter ended March 31, 2017. The fourth quarter profit stood at Rs717.75 crore against Rs 833.29 crore in FY16.
Revenue from sales declined almost eight% to Rs 7,488 crore. Volumes sold declined almost six% to 1.72 million units in the first full quarter post demonetization in November last year. The company said liquidation of BS III stocks in last two days of March at discounts led to a one-time impact on margins. EBIDTA margins for the quarter stood at 12.79% against 14.66% in same quarter of FY16.
Record 6.66 million two wheelers sold in FY17
For the full year ended March 31, 2017, the company's revenue saw a marginal growth to Rs 30,846 crore against Rs 30,701 crore in FY16. Volumes sold saw a small growth to a record 6.66 million units compared to 6.63 million units in FY16. Annual net profit grew 7% to a record Rs 3,377 crore, helped by soft raw material prices, efficiency measures and higher other income. EBIDTA improved to 15.03% from 14.51% in FY16.
Rs 2,500-cr capex
"In the domestic market, we have maintained our market leadership in a volatile and intensely competitive environment," said Pawan Munjal, chairman, MD & CEO while announcing a capex of Rs 2,500 crore for FY18 and FY19 for new products and capacity additions. Munjal said the company will further consolidate its leadership in FY18 without compromising on the bottom line. The company announced final dividend of Rs 30 per share.
