India’s Hero MotoCorp Ltd reported a better-than-expected 37 percent rise in fourth-quarter profit on Thursday, helped by higher domestic car sales. The world’s largest two-wheeler maker by sales said its profit rose to 8.59 billion rupees ($105.12 million) in the quarter ended March 31, beating analysts’ expectations for 7.35 billion rupees, based on Refinitiv IBES data.
Demand for two-wheelers, which had been pressured by inflationary pressure on Indian households, recovered in the quarter due to festive demand. Plus, shoppers bought ahead ahead of regulatory changes that raised prices starting in April.
Total vehicle sales for the quarter rose to 1.27 million from 1.19 million a year earlier. Operating income rose nearly 12 percent to Rs 8,307 crore.
Like other automakers, the company has benefited from the recently implemented price hikes. Hero raised prices four times in fiscal 2023, the last of which took effect on Dec. 1.
“This quarter, the company was able to drive margin expansion and bottom line growth through a smart mix of pricing, savings and mix,” CEO Niranjan Gupta said in a statement.
He added that the company will accelerate the rollout of electric two-wheelers, with plans to enter 100 cities within this calendar year.
The company’s shares closed 0.47 percent higher ahead of the results, while the Nifty Auto Index closed 0.11 percent higher.
Hero MotoCorp rival TVS Motor Company Ltd on Thursday reported a nearly 50 percent rise in fourth-quarter profit, while Bajaj Auto Ltd reported a 2.5 percent drop in profit early last week.
First published date: May 5, 2023 at 08:38 AM CST