Shares in Eicher Motors Ltd rise as much as 4.3 percent to Rs 28,620 after the automaker posted about 25 percent jump in June-quarter profit on Thursday. Shares traded at Rs 28,728.10, gaining Rs 1,243.85, or rising by 4.53 percent on the BSE at 12.20 pm.
Nomura believes Eicher is on track to achieve guidance. The key upside risk is success of new 650cc models which will be launched in November this year. Nomura has cut price target to Rs 29,344 from Rs 32,743, and maintains “neutral” rating.
Downside risks include cost hike due to ABS (anti-lock braking system) and BS-6 (Bharat stage emission standard) that may impact demand to some extent like in Karnataka and success of competitive launches by Mahindra-Jawa, Bajaj-Triumph and Harley Davidson, according to Nomura.
Citi maintains “buy” rating, saying do not change volume estimates for Royal Enfield but cut margins by 80-130 bps due to higher staff costs and slight commodity cost pressures. Citi has cut price target to Rs 33,800 from Rs 36,500.
Morgan Stanley believes stock set to outperform as new bikes gets launched in Sept 2018 and monthly run rate inches up; keeps ‘overweight’ rating with price target of Rs 34,104.
More than 69,000 shares traded vs 30-day average of 52,456 shares.
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