Hero Honda, India's largest manufacturer of motorcycles has reported a net profit of Rs 2.5 bn for FY01, a growth of 29% YoY. The company's net profit however declined by 9.8% in 4QFY01, due pressure on the company's margins as a result of higher competition.
The company's income went up by 44.5% in 4QFY01, driven by higher realisations as well as a volume growth of 22%. The company's volume growth has slowed down in 4QFY01, due to lower rural demand. For the first nine months of FY01 the company's volumes grew by 41%.
Profit after Tax/(Loss)
Net profit margin (%)
No. of Shares (eoy) (m)
Diluted number of shares
Diluted Earnings per share*
Hero Honda has sold 1,029,510 vehicles in FY01, a growth of 35% over 7,61,623 vehicles sold in FY00.
We were expecting a net profit of Rs 2.7 bn for FY01, as these results are lower than ours by 8.6%, we will need to revise our FY02E and FY03E results downwards, keeping in mind the slowdown in the motorcycle segment.
On the current price of Rs 150 it is trading at 12.1x FY01E EPS of Rs 12.4.
LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.
SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.
Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India. Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: email@example.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407