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Eicher Motors Ltd. Stock Analysis

Large Cap
Evaluated by 5316 users | BSE: 505200 | NSE: EICHERMOT |
Automobile Two & Three Wheelers

Eicher Motors Limited is the flagship company of the Eicher Group in India and a leading player of the Indian automobile industry. The Company is the listed parent of Royal Enfield, the global leader in middleweight motorcycles. The world’s oldest...

1. Right Stock
Very Good
2. Right Price
3. Right Time

Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
Financial track record gives insight into the company's performance on key parameters over the past ten years. MoneyWorks4me’s proprietary colour codes make it easy for retail investors to gauge the company’s past performance.
Eicher Motors Ltd. has performed well in majority of the past ten years indicating its past ten year financial track record is very good
Value Creation
Value Creation Index Colour Code Guide
 Dec'10Dec'11Dec'12Dec'13Dec'14Mar'16Mar'17Mar'18Mar'19Mar'20
Return on Capital Employed 9.76%13.39%12.09%12.87%16.92%36.58%36.75%31.08%27.18%19.29%
Value Creation Index -0.260.02-0.08-0.020.291.791.801.371.070.47
Growth Parameters
Growth Parameters Colour Code Guide
Net Sales (Rs. Cr.) 4,3975,6846,3906,8108,7384,9397,0338,9659,7979,154
Y-o-Y Gr. Rt.-29.3%12.4%6.6%28.3%-43.5%42.4%27.5%9.3%-6.6%
Adjusted EPS (Rs.) 6.5910.6611.3213.8521.139.4761.5871.9180.9467.45
Y-o-Y Gr. Rt.-61.8%6.2%22.4%52.4%87.1%56%16.8%12.6%-16.7%
Book Value per Share (Rs.) 45.7455.326576.0192.84106.86194.78255.7324.78363.04
Adjusted Net Profit 1782883063745721,0721,6761,9602,2081,842
Net Op. Cash Flow (Rs. Cr.) 3364054967161,0471,1701,7082,4821,5751,694
Debt to Cash Flow from Ops 0.280.110.050.120.060.020.070.060.120.09
Standalone financials take only the parent company into account while consolidated financials take into account financials of the parent company as well as of all its subsidiaries. In most companies consolidated financials should be used for analysis.
Eicher Motors Ltd. should be analysed on a Consolidated basis
CAGR
CAGR Colour Code Guide
  9 yrs 5 yrs 3 yrs 1 yr
Net Sales 8.5%0.9%9.2%-6.6%
Adjusted EPS 29.5%26.2%3.1%-16.7%
Book Value per Share 25.931.423.111.8
Share Price 36.2% 9.2% -4.7% 16.6%
Key Financial Parameter
Performance Ratio Colour Code Guide
 Dec'10Dec'11Dec'12Dec'13Dec'14Mar'16Mar'17Mar'18Mar'19Mar'20
Return on Equity (%) 15.4421.1118.8219.6525.0243.4437.2431.6827.6919.49
Operating Profit Margin (%) 7.9210.398.6610.5212.7927.4131.0831.3329.7124.04
Net Profit Margin (%) 6.728.387.147.437.5319.3121.7821.4520.0819.77
Debt to Equity 0.080.030.010.040.020.010.020.020.020.01
Working Capital Days 56617280779852333945
Cash Conversion Cycle -8-23-2-6-31-31-35-35-29
Corporate Governance What do we look at?
Corporate Governance
Board Credentials
Promoter's holding
Transparency
Integrity
Entity Percentage Holding
Promoters 49.25%
Institutions 38.10%
Non-Institutions 12.50%
Pledged *0.000.000.000.000.000.000.000.000.000.00
* Pledged shares as % of Promoter's holding (%)

MoneyWorks4Me analysed the past 10-year performance of Eicher Motors Ltd. and arrived at the following conclusion:

Past 10 year's financial track record indicates that Eicher Motors Ltd. is a good quality company. However, for specific investment actions please connect with your investment advisor.

The 5-year analysis of Eicher Motors Ltd.'s performance infers:

Eicher Motors Ltd. earnings have grown by 26.2%, whereas share price has appreciated 9.2% CAGR over the past five years, indicating the company's share price is likely undervalued. However, for specific investment actions please connect with your investment advisor.

We analysed the performance of Eicher Motors Ltd. share prices over the last 10 years. Here is what we found out:

Eicher Motors Ltd. share price has appreciated 35.5% annually over the past ten years.

Eicher Motors Limited is the flagship company of the Eicher Group in India and a leading player of the Indian automobile industry. The Company is the listed parent of Royal Enfield, the global leader in middleweight motorcycles. The world’s oldest motorcycle brand in continuous production, Royal Enfield has made its distinctive motorcycles since 1901. Focussed on bringing back simple, yet engaging and accessible motorcycling, Royal Enfield operates in

Eicher Motors Limited is the flagship company of the Eicher Group in India and a leading player of the Indian automobile industry. The Company is the listed parent of Royal Enfield, the global leader in middleweight motorcycles. The world’s oldest motorcycle brand in continuous production, Royal Enfield has made its distinctive motorcycles since 1901. Focussed on bringing back simple, yet engaging and accessible motorcycling, Royal Enfield operates in India, and over 60 countries around the world with modern development facilities in Leicestershire, UK and Chennai, India. Royal Enfield makes its motorcycles in Chennai, Tamil Nadu for the world. Royal Enfield has evolved into an experiential brand. Royal Enfield with its motorcycle that combines modern-day elements with the brand’s heritage, garners immense enthusiasm amongst global motorcyclists. In addition to motorcycles, Eicher has a joint venture with Sweden’s AB Volvo - Volvo Eicher Commercial Vehicles Limited (VECV) - has pioneered modernisation of commercial vehicles in India and other developing countries.

Business area of the company

The Company is engaged in the manufacturing and selling of motorcycles, spare parts and related services.

Products

  • Motorcycles 
  • Commercial Vehicles (CV) 
  • Engineering Components

Awards

2015-16

  • Emerging Company of the Year award - ET Awards 2015 
  • Best Company of the Year award - Business Standard Annual Awards, 2015

2016-17

  • The Himalayan won the Motorcycle of the Year Award up to 500 cc at the NDTV Car and Bike Awards 2017.

2017-18

  • VECV was honoured with ‘Excellence in HR’ at the Manufacturing Today Awards 2017
  • VECV won ET Now HR Leadership Awards 2018 in the Best Talent Management Strategy

2018-19

  • VECV won ‘Best Risk Management Framework and System Automotive and Auto Ancillary’ award by ICICI Lombard and CNBC TV-18
  • Interceptor 650 won the prestigious ‘Best Modern Classic Middle-Weight’ a prestigious category award at the Thailand Bike of the Year 2019 awards.

2019-20

  • Team Eicher won the Gold Medal in the General Management Category at AIMA Corporate Management Olympiad.
  • VECV won the Best Experiential and Brand Experiences award for ‘Samvaad’, an initiative by Eicher Buses, at BTVI National Awards for Marketing Excellence.

Milestones

  • 1948: Goodearth Company set up to sell and service imported tractors
  • 1952-57: Goodearth Company imported and sold about 1500 tractors in India
  • 1958: Eicher Tractor Corporation of India Limited incorporated
  • 1959: First indigenous Eicher tractor built. Eicher came out with India’s first indigenously built tractor from its Faridabad factory.
  • 1960: Eicher changed name from Eicher Tractor Corporation of India Private Limited to Eicher Tractors India Limited
  • 1965-75: 100% indigenization achieved in Eicher Tractors
  • 1980: Eicher Goodearth Limited name given to Eicher.
  • 1982: Collaboration agreement with Mitsubishi for the manufacture of Light Commercial Vehicles signed in Tokyo. 
  • 1982: Incorporation of Eicher Motors Limited
  • 1985: Silver Jubilee Year for Eicher
  • 1986: Eicher Motors Limited springs into operation
  • 1987: Eicher Tractors went public
  • 1990: Eicher Goodearth buys 26% equity stake in Enfield India Limited
  • 1991: ECS launched; Eicher takes over Ramon & Demm.
  • 1992: Eicher Tractors Limited selected as ‘Company of the Year’ for 1990-91 in the four-wheeler category comprising commercial vehicles, passenger cars, jeeps and tractors.
  • 1993: Eicher adopts new identifier. Eicher acquires majority stake in Enfield India (60% equity shareholding)
  • 1994: Eicher Motors Limited ends the technical assistance agreement with Mitsubishi after a successful transfer of technology and achieving total indigenisation. Enfield India Limited changed its name to Royal Enfield Motors Limited
  • 1996: Eicher Tractors Limited amalgamated with Royal Enfield Motors to form Eicher Limited
  • 2005: Eicher Motors Limited has disinvested the businesses of tractors and engines to TAFE Motors & Tractors Limited (TMTL).
  • 2008: Volvo Group and Eicher Motors Limited established VE Commercial Vehicles Limited (VECV).
  • 2010: The company launched the VE-series of Heavy Duty trucks
  • 2012: Royal Enfield launches the Thunderbird 500 and 350 models.
  • 2013: Royal Enfield opens second manufacturing facility in Oragadam, Tamil Nadu. 
  • 2014: Royal Enfield opens its first concept store in Saket, New Delhi and launches its first exclusive store in London, UK.
  • 2015: Royal Enfield acquires erstwhile collaborators Harris Performance of the U.K., a motorcycle engineering and design firm, to enhance its engineering and product design capabilities.
  • 2015: Royal Enfield sets up its first direct distribution subsidiary outside India, in North America. Royal Enfield North America (RENA) is headquartered in Milwaukee, Wisconsin.
  • 2016: Royal Enfield debuts its first purpose-built adventure tourer motorcycle - the Himalayan. With the all-new LS410 engine and terrain-tested chassis, it promises the ride of a lifetime on all roads and no roads
  • 2017: Royal Enfield moves into its state-of-the-art Tech Centre at Leicestershire, UK to design and develop new motorcycle platforms for the global market
  • 2018: Royal Enfield launches its first air-cooled parallel twin cylinder motorcycles in 50 years - Continental GT 650 and Interceptor INT 650 for the International and domestic market
  • 2019: Royal Enfield transitions to BS VI emission norms for its current motorcycle portfolio and grew its retail network by opening studio stores - a unique, compact format that will house the entire range of Royal Enfield motorcycles
Puchho Befikar
SEBI Registered: Investment Adviser - INA000013323

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