Eicher Motors Q2 Results Review - Balance Approach For Volumes, Margins: Yes Securities
After witnessing severe headwinds over last 24 months, we expect volumes to grow ~24% CAGR over FY22‐24E.
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Yes Securities Report
Eicher Motors Ltd.'s Q2 FY23 reported consolidated results were in‐line at revenues/profit after tax while Ebitda was ~5% below our estimates at Rs 8.2 billion (our estimate: Rs 8.6 billion) with margins contracting 110 bps QoQ at 23.3% (our estimate: 24.5%).
This was largely due to ~8% miss in Ebitda of standalone performance as-
average selling price came in lower at Rs 164,000/unit (our estimate: Rs 170,000/unit) and
standalone gross margins came in lower at 41.5% (our estimate: 43.3%) led by product mix and raw material inflation.
Eicher Motors’ margins expansion to be gradual as impact of weaker product mix (increasing contribution from Hunter) to partially offset by-
price hikes of Rs 3000/unit for Hunter in November-22,
plus operating leverage due to higher volumes and
increased share of exports as Hunter will be launched in exports markets from the current month.
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