Following its December quarter results (Q3FY25) and as international brokerage firm Goldman Sachs lowered its target price on the stock, shares of Eicher Motors plummeted by about 7% during intraday trading on Tuesday, February 11.
While keeping its ‘purchase’ recommendation on Eicher Motors, Goldman Sachs lowered its target price from ₹6,000 to ₹5,900, suggesting an 11.5% upside potential from the previous close. With a stronger emphasis on product and marketing initiatives to support future growth, the brokerage observed that the company’s Q3 performance aligned with expectations. In Q4, volume momentum is anticipated to continue due to persistent demand. Goldman Sachs, however, reduced its FY25–27 EPS projections by 5.4%, pointing to increased marketing costs as a significant contributing reason. In addition, Eicher has experienced a wider range of regulation-driven price increases than the rest of the sector.
Eicher Motors Q3 Results:
In the third quarter, Eicher Motors’ net profit increased by 18% to ₹1,170 crore from ₹995.97 crore during the same fiscal year. In Q3 FY25, revenue from operations increased 19% to ₹4,888 crore from ₹4,116 crore in the same period last year.
The company’s EBITDA increased from ₹1,090 crore in Q3 FY24 to ₹1,201 crore, a 10% YoY increase.
Revenue for the VE Commercial Vehicles (VECV) sector increased 6% yearly to ₹5,801 crore, while EBITDA increased 16% to ₹509 crore. After taxes, the segment’s earnings jumped 44% to ₹301 crore.
With 21,012 cars sold in Q3 FY25, VECV surpassed the 20,706 units sold the previous year, setting a new quarterly sales volume. Despite the general slowdown in the CV industry, the company said its commercial vehicles division showed tenacity and increased its market share.
“With a strong and diverse product portfolio, we are well on track to meet the evolving needs of riders across the world,” said Siddhartha Lal, Managing Director of Eicher Motors, expressing confidence in the company’s future. VE Commercial Vehicles increased volumes each quarter and strengthened its market share across all sectors despite the commercial vehicle industry’s continued slowness. Given WGivent’s current momentum in the motorcycle and commercial vehicle industries, we are optimistic about future success.
Royal Enfield had its highest-ever quarterly sales volume of 269,039 bikes, a 17 percent increase from 229,214 motorcycles sold in Q3 FY24, further solidifying its position in the mid-size motorcycle market.
In highlighting the company’s operational strategy, Royal Enfield CEO Govindarajan said, “Our performance in the last quarter is a result of the groundwork we put in throughout the year—preparing for key launches and optimizing operations to ensure we were ready to deliver at this scale, especially during the festive season in India.”
Stock Performance:
Eicher Motors’ shares dropped 6.8% to its intra-day low of ₹4,966.15 after the firm revised its target price. The stock is currently more than 10% below its peak of ₹5,551.75, reached on February 4, 2025. It is still more than 35% higher than its 52-week low of ₹3,675.00, reached in March 2024. The stock has increased by 39% in the last 12 months. The stock is down 1% in February 2025 after rising 8% in January.
