Hero MotoCorp Q4 net profit rises 39% to Rs 865 crore, beats estimates

'While a late recovery towards the second half of FY21 saw the company gain strong volumes, the broader market continues to suffer in view of the recent Covid surge,' says Pawan Munjal

India's largest two-wheeler maker Hero MotoCorp on Thursday posted a 39.2 per cent increase in its standalone net profit at Rs 864.97 crore for the quarter ended March 31, 2021 (Q4FY21). It was Rs 620.7 crore in the year-ago period.

On a consolidated basis, Hero MotoCorp's profit after tax came in at Rs 885.28 crore compared with Rs 613.81 crore reported in Q4FY20.

The company's board has recommended a final dividend of Rs 25 per equity share and a special dividend of Rs 10 per equity share.

The two wheeler major's revenue from operations came in at Rs 8,685.97 crore, up 39.2 per cent from Rs 6,238.39 crore in the same quarter last year.

The numbers beat Street expectations as brokerages were anticipating over 30 per cent YoY increase in net profit. Kotak Institutional Equities, for instance, pegged Hero Moto’s PAT at Rs 851.6 crore, up 37 per cent YoY and down just 21 per cent QoQ. Revenue, meanwhile, was seen at Rs 8,493.8 crore, up 33 per cent YoY by global brokerage Nomura. READ HERE

“Despite the challenges, Hero MotoCorp grew its market share in both motorcycles and scooters. We also grew our presence in the premium segment that would be further strengthened with our strategic partnership with Harley-Davidson," said Pawan Munjal Chairman & CEO of Hero MotoCorp.

“With the fresh surge in Covid-19, Hero MotoCorp is keeping a close watch on the rapidly evolving situation, as we take steps to protect our employees and operations, while also initiating relief measures to aid the efforts initiated by our organization, and various governments and institutions," he said.

At the operating level, EBITDA (earnings before interest, tax, depreciation, and amortisation) climbed 83.5 per cent YoY to Rs 1,211.2 crore from Rs 659.9 crore. On a quarterly basis, it decreased 14 per cent from Rs 1,413.3 crore.

Pawan Munjal has been re-appointed as the Chairman and CEO for a term of five years with effect from October 1, 2021, subject to the approval of shareholders at the ensuing Annual General Meeting of the Company.

The company has sold 1.56 million two-wheelers during the March quarter as compared to 1.3 million units in the year-ago period.

Hero MotoCorp had halted plant operations temporarily in a staggered manner from April 22-May 1. In view of the rapid escalation in the spread of Covid-19 across the country, the company decided to extend the shutdown till May 9. 

All corporate offices of the company are in Work from Home (WFH) mode and a very small number of colleagues are allowed in offices on rotation basis for the continuity of essential services. 

On Thursday, Hero MotoCorp's scrip rose 4.67 per cent to close at Rs 2,918.40 on NSE.