Eicher Motors Q1 FY27 earnings call

Eicher Motors Limited commenced FY27 with a robust performance, achieving its best-ever Q1 consolidated revenue of INR 6,632 crores, marking a 32% growth over Q1 FY26. Consolidated EBITDA also saw a significant increase of 32.25% to INR 1,591 crores, while PAT grew 21% to INR 1,463 crores. Both Royal Enfield and VECV registered their highest ever quarterly sales, with Royal Enfield selling 332,940 motorcycles and VECV delivering 24,815 units, indicating strong market dominance.

Royal Enfield solidified its leadership in the middleweight motorcycle segment with key launches. The company introduced its first electric motorcycle, the Flying Flea C6, and the iconic Bullet on the 650cc platform. The Hunter 350 received an expanded lineup with new variants and colorways, continuing to attract new and young riders. The Himalayan 450 has emerged as the best-selling adventure motorcycle in its class across various regions, including India and Brazil.

VE Commercial Vehicles (VECV) demonstrated broad-based growth, with overall sales up 14.8% to 24,815 units. Heavy-duty truck sales grew 15.2% to 5,275 units, securing an 8.8% market share. The entry into the small commercial vehicle segment with 1,041 Pro X trucks, including 172 electric vehicles, opens new avenues for growth. Exports also performed strongly, increasing 14.7% to 1,450 units, and spares sales grew 15.3% to INR 931.3 crores.

To meet future demand, Eicher Motors announced a strategic expansion plan for a new greenfield facility in Tada, Andhra Pradesh, with an approved investment of INR 1,225 crores for Phase 1. This expansion is projected to add 4.5 lakh motorcycles per year by FY29-30. The company's current production rate has reached over 5,000 units per day, with the first module at Cheyyar already operational and the next module expected by the first week of October, aiming for a total capacity of 2.45 million units by FY29-30.

Eicher Motors' international business achieved a significant milestone, with revenue crossing INR 1,000 crores for the first time in Q1 FY27, now contributing approximately 15% to overall revenue. The company has seen substantial growth in markets like Brazil, where retail volumes have tripled in the last three years, establishing Royal Enfield as the number two brand in the middleweight segment. Efforts are underway to deepen penetration in ASEAN markets, with a decision on a CKD plant in Indonesia expected this quarter.

Gross margins faced pressure from significant input cost inflation, with a net impact of 4% to 4.5% from commodity price increases. This was partially mitigated by price hikes of 1.75% on 350cc motorcycles in April '26, contributing about 1.2% benefit. Other expenses were lower by about 7%, primarily due to reduced marketing and advertising campaigns (INR 20 crores) and fewer launches (INR 10 crores) compared to Q4 FY26. The company continues to focus on value engineering and cost reduction programs.