Eicher Motors extends fall, hits over 2-month low; down 11% in 3 days

Shares of Eicher Motors hit an over two-month low of Rs 3,215.45, down 3 per cent on the BSE in Thursday’s intra-day trade. In past three trading days, the stock of the listed parent company of Royal Enfield, global leader in the middleweight motorcycles segment (250cc - 750cc), has slipped 11 per cent after Bajaj Auto and British motorcycle brand Triumph on Wednesday launched co-developed Triumph Speed 400 and Scrambler 400 X motorcycles in India.

With past three days decline, Eicher Motors has now now corrected 14 per cent in past one month, as compared to 4.5 per cent rally in the S&P BSE Sensex and 3.5 per cent gain in the S&P BSE Auto index. Eicher Motors was trading at its lowest level since April 25, 2023.

Bajaj Auto has stated a starting price of Rs 2.33 lakh for the Triumph Speed 400 and introductory price of Rs 2.23 lakh for first 10,000 customers. The pricing suggests the companies are targeting significant volumes for the product. The Speed 400 will be sold through Triumph dealerships. The decision to sell these bikes exclusively through Triumph dealerships maintains the brand’s exclusivity and provide a premium customer experience, Research Analyst at Prabhudas Lilladher said.

Earlier, this week, US-based Harley Davidson partnered with Hero MotoCorp to launch its most-affordable motorbike X440 to take on Eicher's Royal Enfield.

On Monday, the US cruiser motorbike maker launched the X440 priced in the range of Rs 2.29 lakh to Rs 2.69 lakh (ex-showroom). With this, it will directly compete with Eicher Motors' Royal Enfield Classic 350's starting price of Rs 1.93 lakh and the Hunter 350's Rs 1.5 lakh.

Royal Enfield operates in India and over 60+ countries around the world. In addition to motorcycles, Eicher Motors has a joint venture with Sweden’s AB Volvo – VE Commercial Vehicles Limited (VECV) - which is driving modernization in India's commercial vehicle space, and in other developing countries. VECV includes the complete range of Eicher branded trucks and buses, Volvo trucks in India, engine manufacturing and exports for Volvo Group, non-automotive engines, and Eicher component business.

The launch of the Triumph Speed 400 and the upcoming Scrambler model indicates the expansion of Triumph's product portfolio in the Indian market. These models are expected to cater to a global customer base. More bikes on same platform will be introduced in the future.

Overall, this launch along with HD X440 which was launched 2 days back heats up the premium segment space in India which was largely dominated by Royal Enfield over the last decade. Positive for Bajaj Auto which will manufacture the motorcycle for India and Exports market. Big overhang for Eicher Motors which manufacturers the Royal Enfield, the brokerage firm said.