HSIE Results Daily 25/05/2026 : Eicher Motors

Looming uncertainties could hamper near-term growth

While the company is preparing for the next leg of growth over the medium term, which we believe will also be driven meaningfully by the international operations, there are uncertainties building that could over the near term cap growth and impact margins. Having said that, management has done well to protect margins to a large extent for now. There is also the additional risk of supply availability that could hamper production in the near future. We value the company at 28x Mar-28 EPS, and along with the value of VECV (INR 682), we reach a TP of INR 7,728, and maintain our ADD rating.

• Standalone performance: EBITDA margin at 25.8% improved 112bps YoY but declined 75bps QoQ, 19bps below our estimate but 53bps above Bloomberg consensus estimate. Raw material cost inflation was largely mitigated.
• VECV performance: VECV revenue grew 16% YoY to INR 80.8bn, with EBITDA margin of 11.1%. Management mentioned that while demand sustains for now, the business environment is dynamic due to geopolitical uncertainties and supply chain volatility.
• Demand momentum is continuing for RE: It highlighted continuing demand momentum, with good traction from first-time buyers as 33% of customers are below the age of 25. Enquiry levels and booking rates continue to remain good.
• Capacity expansion plans and production challenges: It seeks to increase annual capacity from 1.4mn units currently to 1.6mn by Jul’26 and further to 2mn by Q2FY28. However, manpower shortages and gas supply issues affected production recently.
• Cost pressures building but manageable for now: It cautioned on cost inflation and supply availability being near-term challenges. It expects raw material inflation impact to be 3-3.5% in Q1 for both RE and VECV.

Quarterly / Annual Financial Summary

ADD

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Source:

• BSE 
• Company, HSIE Research