Buy Eicher Motors, target price Rs 3625: Motilal Oswal Financial Services

Motilal Oswal Financial Services has buy call on Eicher Motors with a target price of Rs 3625. The current market price of Eicher Motors is Rs 2898.65.

Eicher Motors, incorporated in the year 1982, is a Large Cap company (having a market cap of Rs 79361.95 Crore) operating in Auto sector.

Eicher Motors key Products/Revenue Segments include Automobile - 2 Wheelers, Spare Parts & Components, Allied Products, Other Operating Revenue, Other Services, Scrap for the year ending 31-Mar-2022.


Financials
For the quarter ended 31-12-2022, the company has reported a Consolidated Total Income of Rs 3913.32 Crore, up 6.69 % from last quarter Total Income of Rs 3668.02 Crore and up 31.64 % from last year same quarter Total Income of Rs 2972.79 Crore. Company has reported net profit after tax of Rs 676.95 Crore in latest quarter.

The company’s top management includes Mr.Srinivasan Sandilya, Mr.Siddhartha Vikram Lal, Ms.Manvi Sinha, Mr.Inder Mohan Singh, Mr.Govindarajan Balakrishnan. Company has S R Batliboi & Co. LLP as its auditors. As on 31-12-2022, the company has a total of 27 Crore shares outstanding.

Investment Rationale
From its Royal Enfield business, the management sees stable demand in the domestic market and expects the next phase of growth to come from the ramp-up of Hunter in tier-3 and smaller cities. While the company is witnessing a seasonal decline in export markets, it expects growth to be driven by the ramp-up in the portfolio and its reach in international markets.

The company will continue to launch new products to address demand in international markets and to give upgrade options to RE owners in India. Although the focus remains on profit growth over profitability, Motilal Oswal believes there are levers for margin improvement in the near term.