Eicher Motors gains after resuming production of motorcycles at two plants in Chennai

Eicher Motors rose 1.13% to Rs 16,409.95 at 10:41 IST on BSE after the company announced resumption of production of motorcycles at its two plants in Chennai on 7 December 2015 which were shut down due to heavy rains and flooding in Chennai.

The announcement was made before market hours today, 8 December 2015.

Meanwhile, the BSE Sensex was down 73.46 points, or 0.29%, to 25,456.65

On BSE, so far 508 shares were traded in the counter, compared with an average volume of 5,827 shares in the past one quarter.

The stock hit a high of Rs 16,476.95 and a low of Rs 16,159.10 so far during the day. The stock hit a record high of Rs 21,618.30 on 21 July 2015. The stock hit a 52-week low of Rs 13,725 on 17 December 2014.

The stock had outperformed the market over the past one month till 7 December 2015, falling 2.79% compared with 2.80% decline in the Sensex. The scrip, however, underperformed the market in past one quarter, falling 7% as against Sensex's 2.56% rise.

The large-cap company has an equity capital of Rs 27.15 crore. Face value per share is Rs 10.

Eicher Motors said that the company has resumed production of motorcycles at its Thiruvottiyur and Oragadam plants on 7 December 2015. These two units were shut since 1 December 2015 due to heavy rains and flooding in Chennai. However, due to a high rate of absenteeism by the company's employees and issues with its local suppliers, the company will be running at approximately 50% capacity this week and plan to be back up to 100% capacity by next week, Eicher Motors said.

Eicher Motors said that prima facie, there is no damage to equipment or property due to rains and floods in Chennai and all employees are safe and secure. The company suffered production loss of 7,200 motorcycles due to the closure of both the manufacturing facilities between 1 December 2015 to 6 December 2015, Eicher Motors said. Many parts of the supply chain still continue to be affected due to the aftermath of floods, the company said. Due to the rains, the company lost production of 4,000 motorcycles in November 2015, Eicher Motors said.

On a consolidated basis, Eicher Motors' net profit rose 54.8% to Rs 255.46 crore on 36.7% growth in total income to Rs 3135.16 crore in Q3 September 2015 over Q3 September 2014.

Eicher Motors (EML) is the flagship company of the Eicher Group. EML is one of the leading players in the Indian automotive space. EML's joint venture with the Volvo group, VE Commercial Vehicles, designs, manufactures and markets fuel-efficient trucks and buses. It owns the iconic Royal Enfield motorcycle business, which leads the premium motorcycle segment in India.

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