Shares of Royal Enfield motorcycle maker Eicher Motors rallied 5% to Rs 3,340 in intraday trade on the BSE on Wednesday after the company posted a better-than-expected 62% year-on-year growth for the year (YoY) net profit jumped to Rs 741 crore. On a sequential basis, net profit rose 5.7%.

Analysts, on average, expected a profit of around Rs 700 crore for the quarter. The S&P BSE Sensex rose 0.04% to 61,056 at 11:38 am.

Eicher’s consolidated revenue for Q3FY23 was Rs 3,721 crore, up 29% YoY and 5.7% QoQ. The company’s EBITDA margin was 23%, up 300 basis points year-over-year and down 30 basis points quarter-over-quarter.

In Q3FY23, Royal Enfield sold 219,898 motorcycles in the quarter, a 31% increase on the 167,664 motorcycles sold in Q3FY22. VECV third-quarter sales hit a record high of 18,162 units, up 13.2% from a year earlier.

With the new motorcycles Hunter 350, and recently launched Super Meteor 650, and the imminent launch at Royal Enfield, management said it intends to bring a strong and compelling product portfolio in the middleweight segment, which has a strong presence in the global market has considerable growth potential.

Eicher Motors has invested €50 million in European high-performance electric motorcycle manufacturer Stark Future SL amid growing interest and opportunities in the electric vehicle (EV) industry.

Management commentary suggests that there will be some benefit from lower raw material prices and price increases starting in the fourth quarter of fiscal 2023 due to strong demand for its product profile and near-zero product cannibalisation following the launch of the Hunter 350.

Further management also advised setting up CKD units in Nepal and Bangladesh to strengthen its export market through continuous brand-building activities.