The company’s total motorcycle sales during December quarter declined 5.9 per cent at 194,473 units, as compared to 206,585 units sold in the previous year quarter. Over the last 6 months, RE’s sales have been flat Y-o-Y (vs. 22 per cent growth in Q1FY19, 23 per cent in FY18).
“Despite production issues over the last few months, the waiting period for RE’s major models has declined consistently with dealership inventory now at 3- 4 weeks across regions. This clearly indicates that retail sales have been even weaker than reported wholesale dispatches over the past few months,” analysts at SBICAP Securities said in company update.
“After a robust 46% volume CAGR in FY13-FY18, we see continued de-rating in view of RE’s growing ‘brand fatigue’. Moreover, the strong response to the re-launch of Jawa brand will increase competition for RE,” the brokerage firm said with ‘sell’ rating on the stock with target price of Rs 19,500.
At 10:10 am; Eicher Motors was trading 5.5% lower at Rs 21,900 on the BSE, as compared to a 0.36% decline in the S&P BSE Sensex. A combined 121,538 equity shares changed hands on the counter on the BSE and NSE so far.
In the calendar year 2018, the stock had underperformed the market by falling 24% against 6% rise in the benchmark index.