Hero Honda Q1 net up 13% at Rs 558 cr

The country's largest two-wheeler maker Hero Honda today reported a 13.46% jump in net profit for the quarter ended June 30 to Rs 557.89 crore.

The company had posted a net profit of Rs 491.69 crore for the April-June quarter last year, Hero Honda said in a filing to the Bombay Stock Exchange (BSE).

Total income during the first quarter this fiscal also soared by 32.68% to Rs 5,771.74 crore from Rs 4,350.03 crore in the year-ago period, it added.

The company sold 15,29,577 vehicles in April-June, 2011, up 23.95% from 12,34,039 units in the corresponding period a year ago.

Reacting to the numbers, shares of the company were trading 1.55% higher at Rs 1,788.50 apiece on the BSE in the late afternoon today.

Commenting on the results, Hero Honda Managing Director and CEO Pawan Munjal said: "Our Q1 performance has set the outlook for coming quarters and we are confident of achieving our initial guidance for FY'12 to sell over six million units."

The numbers for the first quarter are in line with the growth that Hero Honda has been reporting for the past several years, he added.

Munjal said the company's initiatives on developing a new brand identity, exploring global opportunities, enhancing R&D capabilities and finalisation of the fourth plant are going ahead.

"However, on an immediate basis, the thrust is on to maintain operational excellence in light of the volatile costs of commodities such as steel, aluminium and rubber," he added.

The company will carry on strengthening its product portfolio through new launches, network expansion and other customer outreach initiatives.

"We have already covered over 1,00,000 villages across the country as part of our rural initiatives under our rural vision, 'Har Gaaon Har Aangan'.

"We are also aggressively expanding our distribution network and we will soon be crossing 5,000 customer touch points by the end of the year. All these initiatives will continue to drive growth for us in the domestic market, even as we explore markets around the world, notably in Latin America, Africa and South East Asia," Munjal said.