Eicher Motors


(JKS) #283

I have the BSE auto alert and it so happened that I was in my inbox when the mail came


(JKS) #284

CV numbers just came out.
http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/ECF865A8_77BC_4AEC_AD88_81C546602399_154150.pdf
At first glance, looks fine. I have not had a detailed look yet and also did not compare with Oct’15 yet


(Dhiraj Dave) #285

3,639 units total monthly sales in November 2015 (25.7%, YOY, -8.7% MOM)
3,985 units monthly sales in October 2015
2,896 units monthly sales in November 2014


(Raj Panda) #286

Eicher enters Thailand Market http://economictimes.indiatimes.com/industry/auto/news/two-wheelers/motorcycles/royal-enfield-announces-entry-into-thailand-market/articleshow/49996292.cms


(sandeep17) #287

What about the Multix sales numbers? Anyone has any insights into this? I don’t think the November sales numbers included Multix unless I have overlooked something.

If I am not wrong, I believe the sales for Multix commenced in August?


(Raj Panda) #288

First Deliver of Multix happened in Aug end http://auto.economictimes.indiatimes.com/news/passenger-vehicle/uv/eicher-polaris-starts-delivery-of-multix-gets-its-first-owner/48691388
So Multix sales have been there for a period of 3 months till date, but company has not released any monthly numbers for it. However last qtr results notes gave this information.


(nandishdalal) #289

This is good to hear!!! Can you help with the price points of Eicher vs. other dominant players in Taipei?? Also do these other players have a manufacturing plant in Taiwan - this question is coming from the context of you mentioning higher import tax…

Thanks!


(Raj Panda) #290

Taiwan has over 100% import taxes on these high end bikes.
So end prices could be reflecting international prices + taxes. From what I understand none of the other dominant players have manufacturing base here.

This is a good read for more details http://topics.amcham.com.tw/2015/04/big-bikes-remain-a-niche-market-in-taiwan/
One peculiar thing here is, the highways/expressways don’t allow bikes lesser than 250 cc and the commuter segment is still dominated by 125-150cc bikes. So ppl who travel long distance in city have an incentive to upgrade to 255+cc bikes and use the expressways to cut down much of the high traffic routes.


(Empower the Looser) #291

Any updates on Production facility @ Chennai due to floods ? #Chennaifloods


(Raj Panda) #292

As per Ambit’s note on Dec 2nd, production of RE is impacted, but hard to substantiate at this stage.


(JKS) #293

http://www.bseindia.com/corporates/ann.aspx?scrip=505200&dur=A&expandable=0


(Dhiraj Dave) #294

Carcita View on Eicher.

http://economictimes.indiatimes.com/opinion/interviews/eicher-motors-stock-looks-30-40-undervalued-teresa-barger-cartica-capital/articleshow/50308149.cms

Discl: Invested in Eicher for more than 12 months


#295

Does this statement raise an alarm in anyone’s mind?

“I don’t care about making a dent in our P&L here in India, that is not important but dent in that (US) market, that is important.”

Read more at: http://www.moneycontrol.com/news/business/10x-aimmind-royal-enfield-kick-starts-renewed-us-ride_4668601.html?utm_source=ref_article


(Marathondreams) #296

Succeeding in India and succeeding in US and Europe are completely different ball game. The same applies in reverse too. Any global expansion requires deep pockets and tons of patience. In the end, it may be worthwhile but success rate is very small. Mahindra is trying to enter US market for tractors for last 15 years and still not able to make much dent.

In nutshell, I expect pain in the short term on P&L. If successful, it may be worth it. But if not, it can pull down highly successful and profitable company.


(Raj Panda) #297
  • The category (Leisure/Heavy/Not So Economical/costly) in which RE is present, is not something one can expect, say 30-40% kind of market share. I would say 10% market share is a lot or may be 15% (who knows the exact number, right ?)
  • Indian market size for 2-wheelers is close to 1 cr. a year. RE will be selling close to 4.5 lacs this year. So we are getting close to 5% market share and that leaves with a 2x-3x growth opportunity in domestic market. I am not hazarding any guess on the overall 2-wheeler market size growth, which has been stagnant for couple of years now and ppl expect it to growth if GDP growth comes back to 7%+.
  • This means, this is the right time for company to look for other growth avenues which can keep the growth engine humming for few years down the line.
  • Last year, India exported roughly 25 lac 2 wheelers to the world (Bajaj alone exported 18 lacs). RE is exporting roughly 10k vehicles a year at current run rate. So there is a huge scope for growth there.
  • The export numbers comparison are slightly mis-leading because, most of Indian companies are exporting to the developing markets of the world where price and place are the deciding factors (roughly speaking) and their domestic industry players are probably not relevant.
  • RE mgmt. on the other hand, has started their journey from developed countries where there is no dearth of competition from global & local players, but they are betting on a category which didn’t exist in those markets (mid size affordable leisure bikes) and wants to create a pull market. So we should expect some front loaded expenses for this purpose. Mgmt. explained that, they hired top notch industry players to drive their vision. Obviously there is a cost attached to it, before it can translate to numbers in P&L.
  • And then there is the Columbia, Thailand, Indonesia kind of market, which are solid in terms of overall market sizes and RE is hoping to play a role there.

In this context, should be worried about the above statement ?


(Dhiraj Dave) #298

Wonderful Monthly CV Sales data, Yoy growth of more than 40% for VECV.

http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/3090BA19_4FCC_45F7_89FF_31799FD757F6_121928.pdf


(JKS) #299

Normally, they have been releasing the RE figures first and the VECV figures come later. I am prepared mentally for a slight down tick in RE figures, because of the chennai floods


(JKS) #300

http://www.bseindia.com/corporates/ann.aspx?scrip=505200&dur=A&expandable=0
No dip due to Chennai floods…rough run rate of 40k units keep coming


(Dhiraj Dave) #301

Ashok Leyland CV Sales Growth in December 2015: 31% (12,209 units)
Tata Motor CV Sales Growth in December 2015: 6% (27,347 units)
Eicher Volvo CV Sales Growth in December 2015: 44% (5,068 Units)

After long time Eicher CV division has beaten ALL in monthly sales growth and also for a change to RE with December sales growth at 41%. I see good operating leverage impact in CV business, at least for month of December 2015, in Eicher which quarterly sales growth of 34% during Oct-Dec 2015 sales numbers.

Any view?


(Raj Panda) #302

Vinod Agarwal, VECV CEO interview explaining the situation http://www.moneycontrol.com/news/business/infra-investments2016-to-propel-cv-ind-growth-eicher-motors_4873641.html