Eicher Motors hits record high on FIIs buying

FIIs holdings in two-three wheeler maker has increased to 15.96% in June quarter from 12.88% at the end of March quarter

Eicher Motors is trading higher by nearly 3% at Rs 3,894 after the overseas investors have increased their stake in the company by over 3 percentage points during April-June quarter.

The stock opened at Rs 3,825 and hit a record high of Rs 3,945 on NSE. A combined 98,368 shares have changed hands on the counter till 1250 hours against two week average of 27,000 shares on NSE and BSE.

Foreign institutional investors (FIIs) holdings in two-three wheeler maker have increased to 15.96% in June quarter from 12.88% at the end of March quarter. The overseas investors held 7.84% stake in the company in June 2012 quarter.

Fidelity Investment Trust Fidelity Series Emerging Market and Tree Line Asia Master Fund (Singapore) PTE Ltd have increased their stake to over 1% each in June quarter against nil holding in previous quarter. Meanwhile, the domestic institutional investors’ holdings in the company declined to 8.89% from 11.82% during the quarter.

The stock has outperformed the market by surging 27% as compared to 1.3% rise in benchmark CNX Nifty since May 13 this year, on reporting more-than-double standalone net profit at Rs 97.20 crore for the quarter ended March 2013.

The company’s two-wheeler business, known by its Royal Enfield brand, has been registering strong sales over the last few quarters, compared with the sector which is struggling.

Analyst at Edelweiss Securities expects Eicher Motor’s consolidated revenues to be largely flat year-on-year despite weak commercial vehicles sales offset by strong sales of Royal Enfield. Consolidated EBITDA margin is likely to be lower at around 8% due to continued pressure in the VE Commercial Vehicles (VECV) business.