Eicher Motors advances as foreign brokerage initiates coverage with a buy

Eicher Motors rose 2.3% to Rs 17,800 at 12:34 IST on BSE on reports a foreign brokerage initiated coverage on the stock with a buy rating.

Meanwhile, the S&P BSE Sensex was up 118.55 points or 0.45% at 26,543.85.

On BSE, so far 2,416 shares were traded in the counter as against average daily volume of 28,736 shares in the past one quarter.

The stock hit a high of Rs 17,880 and a low of Rs 17,629.85 so far during the day. The stock had hit a record high of Rs 19,525 on 25 May 2015. The stock had hit a 52-week low of Rs 7,061.60 on 23 June 2014.

The stock had outperformed the market over the past one month till 12 June 2015, rising 1.63% compared with Sensex's 1.68% fall. The scrip had also outperformed the market in past one quarter, advancing 6.64% as against Sensex's 8.66% fall.

The large-cap company has equity capital of Rs 27.14 crore. Face value per share is Rs 10.

The foreign brokerage reportedly said that the structural growth from Royal Enfield is likely to continue and it expects Eicher Motors to deliver sector-leading growth. The brokerage noted that the industry demand is shifting towards premium bikes and Eicher's premium valuations are likely to be sustained going ahead, as per reports.

On a consolidated basis, Eicher Motors' net profit rose 40.4% to Rs 195.28 crore on 33.3% growth in net sales to Rs 2532.97 crore in Q1 March 2015 over Q1 March 2014.

Eicher Motors (EML) is the flagship company of the Eicher Group, which was a catalyst in the green revolution in India with the production of India's first agricultural tractor in 1959. EML is now a leading player in the Indian automotive space. Its joint venture with the Volvo group, VE Commercial Vehicles, designs, manufactures and markets reliable, fuel-efficient trucks and buses; and is leading the path in driving modernization in commercial transportation in India and other developing markets. Eicher Motors also owns the iconic Royal Enfield motorcycle business, which leads the premium motorcycle segment in India.

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