Hero MotoCorp Q1 2014 result, new Karizma R and ZMR for India

Hero MotoCorp last week reported its Q4 FY ’14-15 (January-March 2014) results. Hero reported highest ever quarter sales of 15,89,462 units with company total turnover (Net Sales & other Operating Income) growth for the quarter being Rs 6512.96 crore. This equates to 6% growth over over Rs. 6145.75 crore reported in Q1 2013. EBIDTA margin for the quarter stood at 13.73%.

Hero Karizma ROn the growth front, Hero Karizma in its new avatar is here to impress. Showcased earlier this year, Karizma R and Karizma ZMR are now arriving at dealerships pan India. Both get power from the same 223 cc engine for a varied output. Karizma R continues to deliver 19.2 PS power and 19.35 Nm torque. Hero’s American motorcycle racing company – Erik Buell Racing’s contribution ensures Karizma ZMR with fuel injection delivers 20 PS and 19.35 Nm torque. The previous Karizma’s 223 cc engine produced 17.35 PS power and 18.35 Nm torque. Hero Karizma R is available at a price of Rs 79,884, and ZMR at a price of Rs 99,478 (ex sh Pune).

For the fiscal, Hero MotoCorp reported 62,45,960 units sold to register total turnover (Net Sales & Other Operating income) of Rs 25275.47 crore for FY 2013-14, as compared to Rs.23,768.11 crore reported in FY’13. Profit after tax (PAT) was reported at Rs 2109.08 crore and operating margin of 9.62% for the fiscal. HMCL’s EBIDTA stood at 14.01% for the financial year.

Hero Karizma ZMRHero MotoCorp strong performance translated into a dividend of Rs 65 per share. The company sustained earning per share (EPS) of 105.61 in line with the previous year despite higher income tax rate in the current year with only 30% tax exemption this year, it’s 6th year of operations at Haridwar. Hero MotoCorp was entitled to 100% exemption in the first 5 years of operation at its Haridwar plant, and this expired last year.

Pawan Munjal, Hero MotoCorp Managing Director and Chief Executive officer said, “These numbers are reflective of our new strategic approach focused on bringing path-breaking technologies and consolidating our leadership. FY’14 was all about setting new benchmarks, which culminated with the sales of 6.25 million during the year – our highest-ever sales for any financial year.However, the industry continued to witness tepid growth during FY’14, although the sentiments did improve in the second half of the year, starting with the festival season in October. In FY’15, we have an action-packed year ahead of us with a slew of new products lined up for launch and further expansion of our global footprint.The country has just entered a new era of governance. After three long decades, a single political party has come to power with such a huge majority, and it is clearly a mandate for good governance, development and inclusive growth. With the new government expected to speed up the reforms process and improve the investment climate, we look forward to a revival of the economy and the industry this year.”

Financial Results: Q4, FY’14 Financial Results: FY ’14
  • Total sales for Q4 stands at 15,89,462 units
  • Total unit sales of 62,45,960 two-wheelers
  • Total turnover (Net sales and other operating income) Rs 6512.96 crore
  • Total turnover (Net sales and other operating income) of Rs 25,275.47. crore
  • Net profit after tax stands at Rs 554.43 crore
  • Net profit after tax stands at Rs 2109.08 crore
  • EBIDTA margin for the quarter 13.73 per cent
  • Total dividend of Rs 65 per share
  • EBIDTA margin for the year 14.01 per cent
  • EPS of Rs 105.61 /-

Business Highlights: FY’14

Motor Show 2014
  • Showcased new platforms, including path-breaking concept models – the diesel two-wheeler RNT, electric motorcycle SimplEcity, ‘iON’, the 620cc Hastur, 250cc sports bike HX 250R and the first serial hybrid scooter from India – Leap.
  • Also showcased a bouquet of exciting new scooters – the 150cc ‘ZIR’ in two variants, 125cc ‘DARE’ and the 110cc scooter ‘DASH’
  • Some of the products developed on new platforms will be launched in FY’15
Revolutionary technologies on existing platforms
  • Next-gen features to be introduced in its new product line-up
  • i3S Technology (Idle Stop & Start System) recently launched on the new Splendor iSmart
  • Integrated Braking System (IBS) introduced in the new Pleasure
  • Engine Immobiliser debuts on the new 150cc Xtreme
  • Apart from these offerings, HMCL also showcased a series of radical refreshes and variants of existing platforms (Karizma & ZMR, HF Dawn, HF Deluxe, HF Deluxe Eco, Splendor Pro, Super Splendor, Passion Pro, Glamour and Glamour F1)
Global Foray
  • Expanded its global footprint by launching brand ‘Hero’ and its range of products in Central America (Guatemala, Honduras & El Salvador); South America (Peru & Ecuador), East Africa (Kenya, Mozambique, Tanzania & Uganda), West Africa (Burkina Faso, Ivory Coast, Congo & Angola) and most recently Asia (Bangladesh, Turkey & Egypt).
  • Also established its international assembly units in Kenya, Tanzania & Uganda in East Africa through its local distributors
  • Hero already has operations in Sri Lanka & Nepal
The global R&D Hub
  • Commenced construction of its Rs 450 Crore “Hero Centre of Global Innovation and Research & Design (R&D)” at Kukas, near Jaipur in Rajasthan
New Strategic Partnership
  • Formed strategic Joint Venture with Magneti Marelli to develop and manufacture next generation fuel injection systems
Foreign Investments
  • Made first-ever equity investment in an overseas firm; announced purchase of 49.2 per cent equity at Erik Buell Racing (EBR) for US$ 25 Million
  • Forms its first overseas Joint Venture – with the Nitol Niloy Group of Bangladesh; to set up manufacturing plant in the country
Sales Performance
  • Registered 6.25 lakh sales in October 2013, first-ever manufacturer to cross landmark 6 lakh unit sales in a month
  • Record 1.2 million retail sales during the festive months of October-November 2013
  • Record 1.1 million retail sales for any non-festive period achieved in April –May 2013
  • Surpassed the landmark milestone of 50 million units in cumulative sales since inception
Other significant developments
  • Launched India’s first-ever warranty of 5 years on all its two-wheelers (5 years or 70,000 km on motorcycles, whichever is earlier and 5 years or 50,000 km on scooters, whichever is earlier)
  • Launched its retail finance arm, Hero FinCorp, with a phase-wise expansion plan
  • Expands its association with the youth & joins the Sunburn Festival – an EDM music festival highly popular among youngsters – as the Title Sponsor