Eicher Motors Ltd. (EML) has set aside a capex of ₹1,200 crore for Royal Enfield and ₹1,000 crore for VE Commercial Vehicles (VECV), for the current fiscal, said a top company executive.
“For the current fiscal, we have set aside a capex of ₹1,200 crore mainly for development of new products including electric vehicles and international growth,” said Royal Enfield CEO B. Govindarajan. “This will be financed through internal accruals and debt,” he said during an interaction.
The CEO also said that the company was making substantial progress in development of electric motorcycles that would be unveiled during FY25. Besides, Royal Enfield will be rolling out one or two products in all the platforms, he said.
According to Mr. Govindarajan, Royal Enfield has expanded its international footprint by setting up its fifth completely knocked down (CKD) assembly unit outside India in Nepal, while the next one will come up in Bangladesh. Besides, it has made a debut in Turkey and established a wholly owned subsidiary in the Netherlands to cater to evolving consumers in the European Union (EU).
Profit rises
EML’s consolidated net profit for the quarter ended March rose 18% YoY to ₹1,070 crore on higher sales volume. Revenue from operations rose 12% to ₹4,256 crore.
The company sold 2.28 lakh motorcycles against 2.15 lakh in the year-earlier period. Mr. Govindarajan said that FY24 recorded the best ever performance. It also surpassed pre-COVID levels of growth.
VECV’s net profit contracted to ₹242 crore from ₹315 crore, while total revenue increased by ₹275 crore to ₹6,275 crore. The board declared a final dividend of ₹51 per share.
“We had a remarkable year at EML and have reported exceptional performance across both Royal Enfield and VE Commercial Vehicles,” EML MD & CEO Siddhartha Lal said at a press meet.
To a question on EVs, he said that as far as VECV was concerned, it had commenced sales of EV trucks and had the global unveiling of the new electric-first small commercial vehicle. VECV MD & CEO Vinod Aggarwal said the electric small commercial vehicle showcased at Bharat Mobility Global Expo, will mark a new growth segment for VECV in the 2.5-3.5 tonne category.”
