Hero MotoCorp Ltd, on August 12, reported a 131 percent growth in its consolidated net profit at Rs 590 crore for the first quarter ended June 2022 as against Rs 256 crore recorded a year ago. On a sequential basis, the profit slipped 3.4 percent from Rs 611 crore earned during the January–March period.
Consolidated revenue for the world’s largest 2-wheeler manufacturer rose 54 percent on-year to Rs 8,448 crore as compared to Rs 5,503 crore registered in the year-ago quarter. On a sequential basis, the revenue is higher by 12.7 percent against Rs 7,497 crore recorded in the previous quarter.
The growth in the revenue was fueled by higher volumes and better realizations which were partly offset by a lower mix from the spares segment as well as lower export volumes.
“The fiscal year began on a positive note for the industry, with growth over not only last year but sequentially over Q4FY22 as well”, said Niranjan Gupta, Chief Financial Officer while commenting on the performance for the quarter. “While the macro economic environment globally is facing headwinds of inflation, Indian economy is relatively better placed to move on path to recovery and growth”.
Certain key indicators like GST collections, PMI, consumer confidence index are all moving in the right direction, he added.
On a standalone basis, the company earned a profit after tax (PAT) of Rs 625 crore at a YoY growth of 71 percent from Rs 365 crore PAT achieved during the same period last year. On a sequential basis, the PAT remained flat.
Standalone revenues for the quarter jumped 53 percent on year to Rs 8,393 crore from the revenues of Rs 5,487 crore during the prior year period. On a sequential basis, the revenues were higher by 13 percent.
The volumes for the quarter stood at 13.90 lakh vehicles at a YoY growth of 36 percent
The company’s standalone EBITDA (earnings before interest, tax, depreciation and amortization) for the quarter increased by 83 percent on year to Rs 941 crore as compared to an EBITDA of Rs 515 crore for the same period last year.
The EBITDA margins for the quarter at 11.2 percent remained flat on the sequential basis.
“As the country enters the festive season, we expect the 2 wheeler demand to be on a healthy trajectory supported by micro factors like normal monsoon, crop cycle, opening of all sectors of the economy etc”, Gupta added. He expects the margin pressure on the industry is also likely to ease in coming quarters, as commodities cool off and price recovery moves ahead of cost impact.
Hero MotoCorp intends to launch its much awaited electric vehicle during the coming festive season and has been collaborating with partners for the same, including the setting up of charging infrastructure.
Hero MotoCorp closed Rs 23.4 lower at Rs 2,761.9 on August 12 at the National Stock Exchange. The stock has been trading flat compared to its price a year ago and is down 4 percent over the past one month.
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