Eicher Motors Q2 Review - ASP Surprises Positively; Royal Enfield Volume Growth Awaited: ICICI Direct
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ICICI Direct Report
Eicher Motors Ltd. posted healthy Q2 FY22 results that beat estimates. Consolidated revenues were at Rs 2,250 crore, up 13.9% QoQ. Reported Ebitda margins came in at 20.9%, up 250 bps QoQ. Consequent consolidated PAT was at Rs 373 crore, up 57.4% QoQ.
Key triggers for future price performance:
We expect 12.6% FY21-23E Royal Enfield volume CAGR aided by low base, abating of supply constraints, new product introduction (including Classic 350), network expansion benefits and higher exports.
Continued VECV outperformance in CVs to lead to market share gains; we build 31% FY21-23E volume CAGR as cyclical recovery gathers pace.
Overall FY21-23E consolidated net sales CAGR expected at 27.1%, with margins seen rising to 24.3% by FY23E riding on operating leverage gains
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