Hero MotoCorp's Q1 net profit soars 18%

Hero MotoCorp – the world's largest two wheeler motorcycle manufacturer, has reported its June quarter ended 2016 results (Q1FY17).

The  company reported net profit of Rs 883.10 crore, witnessing a rise of 18.13% yoy (year-on-year) and 5.80% qoq (quarter-on-quarter).

Overall the result was positive with strong bottom-line and EBITDA margins.

It’s total income was a mixed bag for Q1FY17. The company’s revenue from operations stood at Rs 8010.66 crore, which grew by 7.73% yoy but declined by 1.23% qoq.

While operating profit (EBITDA – earnings before interest tax depreciation and amortisation) of the company was at Rs 1230.08 crore, increasing by 18.04% yoy and 3.20% qoq.

Also, operating profit margin (OPM) was at 15.35%, which expanded by 134 basis points yoy and 66 basis points qoq.  

Pawan Munjal, Chairman, Managing Director and Chief Executive Officer of Hero MotoCorp said,"The first quarter of this fiscal carried forward the growth trajectory that we set for ourselves in the previous quarter. The sales growth is reflected in the positive financial results for the quarter, and has given us the momentum to carry forward as we prepared for the upcoming festive season.

For the June quarter, the company sold two-wheelers of around 17,45,389 units, a rise of 6.04% compared to 16,45,867 units sold in corresponding period of the previous years. It also rose by 1.40% against 17,21,240 units sold in preceding quarter.

This would be the highest ever quarterly sales of Hero Motocorp.

The popularity in the sales volume was followed by 125cc segment, where the company now commands well over 50% of market share, driven by strong performance from Glamour and Super Splendor.

During the first quarter, the Glamour rose by 32%, followed by Super Splendor contributing around 29% growth in comparison with June 2015.

"With the above-average monsoon so far and the implementation of the 7th Pay Commission recommendations, we remain cautiously about the remaining months of financial year 2017," added Munjal.

The company has adopted Indian Accounting Standards (Ind-As) for FY17.

To further strengthen itself, Hero MotoCorp has also launched an all-new Splendor iSmart 110 at Jaipur plant, for which customers have responded positively. 

The share price of Hero Motocorp was trading at Rs 3510.65, soaring by Rs 76.35 or 2.22%.