Corporate tax cut boosts Eicher Q2 profit, but revenue declines1 min read . Updated: 08 Nov 2019, 04:39 PM IST
- The company reported a net profit of ₹573 crore in the second quarter against ₹549 crore a year ago
- Revenue during the quarter declined 9% to ₹2192 crore, while operatinsg profit declined 26% to ₹541 crore
Shrugging off a decline in revenue, Eicher Motors Ltd -- manufacturer of Royal Enfield brand of premium motorcycles -- on Friday reported a 4.4% year-on-year rise in profit for the September quarter helped by the cut in corporate tax.
The company reported a net profit of ₹573 crore in the second quarter against ₹549 crore a year ago. Revenue during the quarter declined 9% to ₹2192 crore, while operating profit declined 26% to ₹541 crore.
The leading manufacturer of middle weight premium motorcycles witnessed a 22% decline in its motorcycle volumes to 163,390 units. Sales of the company’s commercial vehicles - medium weight buses and trucks - also declined a whopping 39.2% to 11370 units.
According to Siddhartha Lal, managing director, Eicher Motors, the company has continued to invest in the long term through the last few quarters by pursuing greater innovation, improving efficiencies, and making investments in different areas.
“We’ve remained focused on building greater accessibility for our consumers, through new variant launches and improving our retail footprint. These efforts are beginning to yield good results for us," added Lal.
Meanwhile, Volvo Eicher Commercial Vehicles Ltd -- Eicher’s joint venture with Volvo AG -- reported 32% decline in revenues to ₹2004 crore. Its net profit during the quarter declined a sharp 89% to ₹15 crore.
“CV industry continues to go through a challenging phase, with extreme slowdown in demand. In the first half of this year, industry volumes have declined by 36% with an even higher drop of about 50% in the second quarter. Even though our volumes have reduced, our decline has been a bit lower than the industry with a drop of 30% in the first half and 39% in the second quarter, respectively" said Vinod Aggarwal, chief executive, VECV.