- 08 Feb 2023
- ICICIdirect Research
Hero MotoCorp posts mixed operational performance for Q3FY23
HEROMOTOCO - 4345 Change: 33.15 (0.77 %)News: Total 2-W sales volume for the quarter was at 12.4 lakh units, down 13.2% QoQ. Consequent total operating income in Q3FY23 came in at Rs 8,031 crore, down 11.5% QoQ. EBITDA in Q3FY23 stood at Rs 924 crore with corresponding EBITDA margins at 11.5% (up 10 bps QoQ). PAT for the quarter came in at Rs 711 crore, flat QoQ
Views: Key surprise for the quarter was sequential rise in blended ASP at ~Rs 63,545/unit (up 1.9% QoQ) despite adverse product mix. The company’s reported massive 255 bps gross margins expansion on QoQ basis vs our expectations of 145 bps, the benefits however were negated by higher other expenses which were up 173 bps QoQ at 12.3% of sales. On a broader term, the company is yet to witness sustained volume recovery in rural space with another key monitorable being colour on its new EV offering and ramp up plans in this domain.
Impact: Neutral