The company had posted net profit of Rs 880.41 crore in the corresponding period of the last financial year.
Revenues from operations last quarter stood at a record Rs 9775.77 crore, which is an increase of 39.7% over Rs 6996.73 crore registered in the year-ago period. Total expenses in the quarter under review went up 38.4% to Rs 8536.63 crore from Rs 6167.41 crore in Q3FY20.
Nomura Securities had expected the company to post 9% increase in net profit at Rs 962.3 crore for the third quarter ended Dec 31,2020. Revenues were expected to grow 38% to Rs 9657.7 crore in the quarter under review.
“This has been possible, thanks to the robust sales volume during the quarter and a combination of key strategic initiatives such as cost reduction efforts to partially offset the impact of the commodity costs and intense operational efficiencies”, the company said in a statement.
Hero MotoCorp sold 18.45 lakh units in the quarter under review, up 19.7% from the 15.41 lakh units sold in the year-ago quarter.
Niranjan Gupta, Chief Financial Officer (CFO), Hero MotoCorp, said “The company has been able to drive profitable growth through improvement in market shares, acceleration of Leap-II savings initiatives, continued control on overheads, and cash flow management. We continue to build on our strong portfolio with the launch of special edition variants to commemorate the milestone of 100 Million units in cumulative production. Going forward, we expect input costs to remain under pressure due to the rising prices of commodities and fuel. The price increase on our range of products that we undertook from January 1 will partially offset these cost pressures. We will continue to focus on driving cost savings, and take judicious price increases if & when necessary.”
Gupta added, with the International Monetary Fund (IMF) projecting a strong recovery in India’s economic growth rate in FY 21-22, the company remains optimistic about the prospects of personal mobility and consumer demand. Hero MotoCorp is confident to make the most of this economic spur on the back of new launches and strong brand equity with customers across markets.
“The government has also provided a balanced and a well-calibrated budget that focuses on reviving growth through infrastructure spends, while generating resources through public sector asset monetization.. The emphasis on health, and outlining a five-year path for fiscal deficit, shows the government’s focus on long-term fiscal prudence. We also welcome the step to abolish the anti dumping duty on steel, and rationalization of duties on some other products to address the cost spiral and impact on consumers”, Gupta informed.
Hero MotoCorp declared interim dividend of Rs. 65 per share, amounting to 3250 %. In addition, the company has announced a special interim dividend of Rs 100 Crore @ Rs. 5 per equity share, to mark the achievement of historic milestone of achieving 100 million cumulative production of two wheelers, taking the aggregate interim dividend to Rs. 70 per share On January 21, 2021, Hero MotoCorp surpassed the milestone of 100 million (10 Crores) units in cumulative production.
Shares of Hero MotoCorp closed at Rs 3440.65 apiece, up by 1.66% on the Bombay Stock Exchange (BSE). The results were announced after market hours.
