On the back of the highest ever quarterly two-wheeler sales in its history, Hero Honda Motors on Wednesday posted a 83% jump in its net profit during the April-June period at Rs 500.11 crore as against Rs 272.87 crore in the corresponding quarter of the last financial year. This is the highest-ever quarterly profit posted by it.
Hero Honda, the country?s largest two-wheeler manufacturer, reported a 34% increase in total turnover (net sales and other operating incomes) during the period at Rs 3822.44 crore as compared to Rs 2851.04 crore during the same quarter of the previous financial year. The company recorded an EBIDTA margin of 17% in the first quarter vis-?-vis 12.23% in the same period of the last year.
Earlier, the country’s second largest two wheeler manufacturer and Hero Honda’s closest rival, Baja Auto, had reported a 67% jump in its net profit at Rs 293 crore. Bajaj’s total income was up 1.4% at Rs 2,338 crore.
?We’re delighted to report our best quarter ever, with the highest revenue and earnings in Hero Honda’s history. Our ongoing focus on continuous innovation in every sphere of our business and fiscal discipline has allowed us to leverage our double-digit sales growth into robust earnings for the quarter. Our operating performance is excellent at both the top and bottom lines. Our balance sheet and liquidity position give us agility and flexibility in today’s weakened global economy and turbulent financial markets,” Pawan Munjal, MD and CEO, Hero Honda Motors, said in a statement.
Sales increased by 25% in the April-June quarter at 11,18,987 units as against 8,94,244 units in the corresponding quarter last year. “With over a 59% market-share in the domestic motorcycle market and sales of over a million units in the quarter, the robust top line growth has largely contributed to the strong bottom line performance. Several other key factors such as cost rationalisation across the board, softening of commodity prices, and tax benefits also contributed to the bottom line,” the company said in a statement.
?The current quarter reflects a substantial tax benefit accrued on account of the company’s full utilisation of the tax benefits available for the Haridwar plant, which resulted in bringing down the overall effective tax rate,? it added.
According to Hero Honda, while most of its recent launches, such as Passion Pro, Splendor NXG self-start, the special edition Hunk, the new Pleasure, in addition to the trusted Splendor+ and Passion Plus, have been share-and-volume drivers for the company, the Hunk and the CBZ X-treme have continued to help build on the company’s steadily growing share in the premium segment.
Shares of Hero Honda closed down 2.03% at Rs 1639.80 on the BSE.