Eicher Motors vrooms to 52-week high riding on Royal Enfield volumes
Eicher Motors share price: Shares of Eicher Motors rose over 3 percent on Tuesday as the foreign brokerage firm CLSA raised its target price on the stock to Rs 4,154, a potential upside of around 20 percent. The Royal Enfield-parent firm's scrip hit a 52-week high at Rs 3,478.05.
Royal Enfield-parent firm Eicher Motors share price gained over 3 percent on Tuesday as global brokerage CLSA raised its target price on the stock to Rs 4,154, suggesting a potential upside of around 20 percent. At 9:47 am, shares of the auto major were trading 3.3 percent at Rs 3,475.3 on the BSE. The scrip hit a 52-week high price of Rs 3,478.05.
CLSA which has a ‘buy’ rating on the stock, sees exports as a key growth area for Eicher Motors. It said that Royal Enfield volumes grew at 33 percent compounded annual growth in FY12-19, and added that most of these customers will be looking to replace their bikes over the next 7-8 years.
CLSA is of the view that Royal Enfield capturing 80-85 percent of this demand would help grow volumes at a significant pace. This is a plausible scenario as customers do not have much choice apart from a brand like Royal Enfield to upgrade to in the ultra-premium motorcycle category, it added.
The global brokerage sees Royal Enfield’s EBITDA (earnings before interest, tax, depreciation and amortisation) per vehicle rising to Rs Rs 46,500 from the current Rs Rs 42,000 driven by softening commodity prices.
Eicher Motors is confident about continued and sustained growth for Royal Enfield in forthcoming quarters with the festive season starting.
Better market and consumer sentiment, along with an improvement in supply chain and part availability, would also help, it had said while detailing June quarter earnings.
Jefferies had said that it sees multiple positives for Royal Enfield and expects the New Hunter Motorcycle to expand its addressable customer base.
Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
BJP's Hindi heartland dominance faces test in phase 3 polls
May 2, 2024 9:14 PM
Lok Sabha Election: Re-elections at a Ajmer booth after presiding officer misplaces register of voters
May 2, 2024 4:54 PM