Eicher Motors rides profitability in Q2FY16

Quarterly

Eicher Motors (EML) recently posted the Q2FY16 result. The company's consolidated revenue boosted by 29.9 per cent in Q2FY16 as compared to the same period in the previous financial year. Its total expenditure increased by 26.73 per cent from Rs 1961 crore in Q2FY15 to Rs 2485 crore in Q2FY16. EML's toal expenditure increased mainly due to a 27.43 per cent increment in other expenses, a 20.17 per cent increment in employee cost, an 18.94 per cent increment in raw material prices during June quarter 2015.

EBITDA of EML rose by 51.72 per cent to Rs 431.64 crore in Q2FY16 compared to the same period in previous fiscal year. The company's EBITDA margin expanded by 213 basis points to 14.8 per cent in Q2FY15 on yearly basis. It's EBIT too increased by 53.94 per cent to Rs 352 crore in Q2FY16 on yearly basis though its depreciation expense increased by 42.61 per cent to Rs 79.45 crore during the quarter. EML's PBT increased by 45.5 per cent to Rs 357 crore in Q2FY16 on yearly basis but its other income declined by 61.88 per cent to Rs 6.79 crore during quarter. The net profit of the company rose by 40.9 per cent to Rs 221.83 crore in Q2FY16 compared to same period in previous financial year. Its net profit margin expanded by 60 basis points to 7.61 per cent in Q2FY16 on yearly basis.

Half yearly

Considering half yearly result, EML's total income increased by 20.05 per cent to Rs 5485 crore in H1 FY16 compared to same period in previous financial year. The total expenditure of the company increased by 18.35 per cent to Rs 4687 crore in H1 FY16 on yearly basis. Its total expenditure increased predominantly due to a 31.08 per cent increment in raw material prices, a 16.2 per cent increment in other expenses, a 15.33 per cent increment in employee cost during first half of FY16.

EML's EBITDA rocketed by 31.12 per cent to reach Rs 798 crore in H1 FY16 as compared to same period in previous fiscal year. The EBITDA margin of the company expanded by 123 basis points to 14.54 per cent in H1 FY16 on yearly basis. Its posted net profit of Rs 417 crore in H1 FY16 with 30.84 per cent growth on yearly basis. The Net profit margin of EML expanded by 63 basis points to 7.61 per cent in H1 FY16 compared to same period in previous fiscal year.

EML's shareholding pattern indicates that FII holdings expanded by 543 basis points to 27.5 per cent and DII holdings contracted by 146 basis points to 4.61 per cent in June 2015 quarter. The share price of the company declined by 2.80 per cent and trading at Rs 21300 on intraday.

EML is the flagship company of the Eicher Group. EML is now a leading player in the Indian automotive space. It owns the iconic Royal Enfield motorcycle business, which leads the premium motorcycle segment in India. EML is a leading player in the mid-size motorcycle segment globally.The Company also owns the Royal Enfield motorcycle business. Its 50-50 joint venture with the Volvo Group to manufacture VE Commercial Vehicles, designs, manufactures and markets trucks and buses.