Views on Hero Motocorp 1QFY2016 Results: Angel Broking

Views of Mr. Bharat Gianani (Sr. Research Analyst - Automobile, Angel Broking) on Hero Motocorp 1QFY2016 Results:

"Hero Motocorp 1QFY2016 results were ahead of our estimates. Revenues declined marginally 1% yoy to INR 6,955 cr in line with our expectations of INR 7,095 cr. Volumes declined 4% yoy due to weak rural sentiments. Realization per vehicle grew 3% yoy to INR 42,267 per unit due to price hikes. Hero's operating margins at 15.1% improved 160 bp yoy and were ahead of our estimates of 13%. During the quarter, raw material costs were lower on account of subdued commodity prices coupled with raw material cost reduction measures under the programme "Leap". Also reduction in marketing expenses due to seasonality further aided in margin improvement. Given the strong operating performance, Net profit at INR 750 cr grew 33% yoy, beating our expectations of INR 679 cr. We currently have NEUTRAL rating on the stock and would review estimates post management interaction."

Shares of HERO MOTOCORP LTD. was last trading in BSE at Rs.2624.25 as compared to the previous close of Rs. 2697.85. The total number of shares traded during the day was 124436 in over 9054 trades.

The stock hit an intraday high of Rs. 2800 and intraday low of 2613.8. The net turnover during the day was Rs. 336687318.

Source : Equity Bulls

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