Hero MotoCorp Q1 Results: Net Profit Misses Estimates Amid Cost Pressures
The company’s net profit stood at Rs 624.5 crore in the quarter ended June compared with Rs 627 crore in the fourth quarter.
Hero MotoCorp Ltd.’s net profit missed estimates amid cost pressures.
The Splendor motorcycle-maker’s net profit stood at Rs 624.5 crore in the quarter ended June compared with Rs 627 crore in the preceding three months, according to an exchange filing. That compares with the Rs 766-crore consensus estimate of analysts tracked by Bloomberg.
Hero MotoCorp Q1 FY23 Highlights (QoQ)
Revenue rose 13% to Rs 8,392.5 crore, versus an estimate of Rs 8,709 crore.
Operating profit rose 14% to Rs 941 crore, compared with the forecast of Rs 1,087 crore.
Operating margin remained unchanged at 11.2%, against an estimate of 12.5%.
India’s largest two-wheeler maker’s sales, however, rose 17% sequentially to 13.9 lakh units in the first quarter. That, however, was aided by a low base as the Omicron variant of Covid-19 impacted operations in the fourth quarter.
Improved demand and higher average selling price also helped the Gurugram-based company. It expects higher demand for two-wheelers to sustain in the upcoming festival season.
“As the country enters the festive season, we expect the two-wheeler demand to be on a healthy trajectory supported by micro factors like normal monsoon, crop cycle, opening of all sectors of the economy, etc.,” Niranjan Gupta, chief financial officer at Hero MotoCorp, said in a statement.
“The margin pressure on the industry is also likely to ease in coming quarters, as commodities cool off and price recovery moves ahead of cost impact,” Gupta said.
Shares of Hero MotoCorp ended 1% lower before the results were announced, compared with a 0.2% rise in the benchmark Nifty 50.