Hero MotoCorp shares gained nearly 3 per cent on bourses on Thursday despite posting weak fourth quarter results. At 11.05 am, the share price of Hero MotoCorp was trading 1.95 per cent up at Rs 3387.15. The share price opened at Rs 3360 and touched a high and low of Rs 3419.35 and Rs 3295.50, respectively, in trade so far. Later, the share price of the company ended 4.26 per cent up at Rs 3463.80.
The company net profit declined 13.86 per cent to Rs 717.75 crore for the fourth quarter ended March as compared to net profit of Rs 833.29 crore in the same quarter of the previous fiscal. The company’s net profit declined following low sales during the quarter under review. However, the company is expected to gain and sales are expected to improve if the monsoons are normal. The Indian Meteorological Department (IMD) on Tuesday had said that monsoon could be ‘normal’ this year and bring 100 per cent rainfall instead of 96 per cent as predicted earlier. Normal monsoon is likely to give a booster dose to the rural economy.
Ind-Ra said if there is a normal monsoon, motorcycle volumes are likely to recover slightly over April-December 2016 growth level of 6.3 per cent with increased currency in circulation, leading to a demand revival in 4Q of FY17 and 18.
The total income also fell by 7.55 per cent to Rs 7,606.31 crore for the fourth quarter as against Rs 8,227.93 crore a year earlier. It sold 16,21,805 two-wheelers during the fourth quarter, down 5.77 per cent from 17,21,240 in the year-ago period.
Hero MotoCorp Chairman, Managing Director and CEO Pawan Munjal said: “In the domestic market, we have maintained our leadership in a volatile and intensely competitive environment.”