Eicher Motors Limited announces financial results for the quarter ended September 30, 2020

For the quarter ended September 30, 2020, Eicher Motors Limited recorded total revenue from operations at Rs. 2,134 crores, EBITDA at Rs. 471 crores and Profit after tax at Rs. 343 crores

New Delhi, November 12, 2020: Eicher Motors Limited (EML) today announced its audited consolidated financial results for the quarter ended September 30, 2020.

For the quarter ended September 30, 2020, Eicher Motors’ total revenue from operations was recorded at Rs.  2,134 crores, down by 3% as compared to Rs. 2,192 crores in the corresponding quarter of FY 2019-20; EBITDA was Rs. 471 crores, down 13% as compared to Rs. 541 crores in the same quarter of the previous financial year; Profit after Tax of Rs. 343 crores against a profit of Rs. 573 crores during the same period last year. Royal Enfield sold 149,120 motorcycles in the quarter, a decline of 9% from 163,390 motorcycles sold over the same period in FY 2019-20.

Commenting on Eicher Motors’ performance, Siddhartha Lal, Managing Director of Eicher Motors Ltd, said, “This quarter, we witnessed healthy demand and pick-up in business activities in the automotive industry. It has been encouraging for our motorcycle business at Royal Enfield as we have seen increased revival in consumer sentiment and demand. We have a robust order book and booking numbers are ahead of pre-covid levels. We are working to ensure sustainable volumes in the forthcoming quarters. We are very excited to have launched the Royal Enfield Meteor 350 earlier this month. The Meteor 350 takes our cruising legacy to the next level from the Thunderbird, and is a gorgeous, accessible and easy cruiser. Initial response from consumers as well as from automobile experts has been very good. We are confident that the Meteor 350 will redefine the highway cruising space in India and globally. In the commercial vehicles industry, the sentiments are improving with a gradual pick-up in the demand from certain sectors. At VECV, we continue to remain focused on our long term objectives, including driving modernization in commercial vehicles. We are happy to have achieved the milestone of being the first and only commercial vehicles company to have introduced 100% connected trucks and buses through advanced telematics”

Speaking on Royal Enfield’s performance, Vinod K. DasariCEO, Royal Enfield said, “At Royal Enfield, consumer demand and our order books have been growing consistently since June this year, and we are happy to report that we are ahead of pre-covid levels of bookings. We have been working consistently towards enhancing and improving the purchase and ownership experience of customers. We recently launched the Royal Enfield Meteor 350 along with Make It Yours – a first-of-its-kind initiative in the two-wheeler industry which allows buyers to personalise, accessorise and configure a motorcycle at booking stage itself. MiY is now available on the Meteor 350 as well as on the 650 Twin motorcycles. We are very proud to be the first Indian motorcycle manufacturer to offer such a wide choice of personalization options to consumers. Innovative initiatives such as Service on Wheels and Home test rides have received encouraging response from customers. We have also expanded our network during the quarter, by adding 25 new stores and 133 studio stores across India, and 6 new exclusive stores in International markets.

Royal Enfield launched the all- new easy Cruiser Meteor 350 in the first week of November 2020. The Meteor 350 is a supremely refined, easy and accessible cruiser. It is an all-new motorcycle, with a ground up engine and chassis that makes it absolutely smooth, refined, very accessible to ride on the open highways and even within the city – it is truly an easy cruiser. The Meteor is inspired by our cruising and long distance riding legacy and building cruisers such as the Citybike, the Lightning and the Thunderbird – India’s No.1 highway cruiser for more than two decades. The Meteor 350 takes all that learning and capability and pushes it several notches to bring a fabulous new motorcycle which we believe will redefine cruising in India and globally. The Meteor 350 comes with an inventive tool, Royal Enfield’s Make It Yours and a new TBT (Turn-By-Turn) navigation pod, known as the Royal Enfield Tripper. Make It Yours allows a customer to personalise his or her motorcycle with thousands of possible combinations via the Royal Enfield App, on the website or at a dealership. Tripper is a highly focused navigation display device for real time directions, built with Google Maps Platform.

With activities and events resuming around the globe, Royal Enfield participated in American Flat Track championship in Daytona, USA. Royal Enfield bagged its very first victory in the championship with Johnny Lewis making history in the ‘Production Twins’ class aboard the Twins FT. The purpose-built Royal Enfield flat track motorcycle was ridden by racer and flat track instructor, Johnny Lewis for ‘Team Moto Anatomy powered by Royal Enfield’. The win also marks the first racing competition win in Royal Enfield’s modern history.

In keeping with the International expansion, Royal Enfield commenced local assembly of motorcycles in Argentina in partnership with Grupo Simpa, Royal Enfield’s local distributor in the country since 2018. This is the first time in Royal Enfield’s modern history that motorcycles will be assembled and produced outside the company’s manufacturing facilities in Chennai, India.

Royal Enfield has always had a longstanding commitment of providing a ‘pure motorcycling’ experience to everyone in love with the motorcycling way of life and also taking it beyond the legendary motorcycles. To engage with the community, the brand rolled out its first-ever design platform – Art of Motorcycling. Through this platform, Royal Enfield fuelled creativity and engaged with artists, creators, and motorcycling enthusiasts and brought forward their love for motorcycling. This saw over 10,000 registrations from all over the country.

On the apparel front, Royal Enfield launched a limited-edition capsule collection in collaboration with Levi’s. With a rich legacy and the cultural impact that both the brands have, the collaboration is a perfect fit for both riders and non-riders.

For the quarter ended 30 September 2020, due to decline in volumes, VECV’s revenue from operations dropped by 13% to Rs 1,703 crores against Rs 1,955 crores in Q2 of last year.  In Spite of drop in revenues, the EBITDA margin improved to 6.9% for the quarter against 5.4% during corresponding quarter for the last year due to stringent cost reduction measures being undertaken. We incurred a marginal loss of Rs 7 crores during this quarter against a profit of Rs 15 Crores in Q2 last year.

Speaking on VECV’s performance Vinod Aggarwal, MD and CEO VECV said “The Commercial vehicles industry (3.5T GVW and above) continued to decline in Q2 despite quarter on quarter improvement. As against Q1 decline of 91%, decline in Q2 was much less at 46% against corresponding quarters of previous year. Within the overall industry, the worst impacted is the Bus segment with decline of 85% in Q2 and 97% in Q1 due to negligible demand from school and staffing segments and adverse impact on inter-city movement through public buses due to COVID.  At the same time, the initial signs of revival of the industry are quite visible with a positive outlook for the economy going forward. We are witnessing good demand from niche segments such as construction, mining, agriculture and e-commerce amongst others.  We are also positive on revival in the replacement demand that had been muted for the last two years. Based on these factors, the outlook for the CV industry is positive for the second half of the current year. As against the decline of 46% in the CV industry in Q2 and 72% in the first half, VECV volume drop has been relatively lower at  28% in Q2 and 58% in the first half resulting in improvement in market shares all across. We sold 8167 vehicles in Q2  and 10296 vehicles in the first half as against 11370 vehicles  in Q2 and 24701 vehicles in the first half of last year.

The last quarter witnessed quite a few exciting developments. It was a proud moment for VECV when it became the first company in the industry to launch 100% connected vehicles with an advanced telematics solution. This will result in significant improvement in productivity for the customers. The state of the art Bhopal truck plant became operational last month with declaration of commercial production. Another notable development was integration of Volvo Bus India into VECV. Along with a strong product line with Eicher brand, the addition of the iconic Volvo brand will give us an edge in technology with access to Volvo Group’s world class technology for Buses.”