news blog from Sharice


UPDATE 1-India Hero Motocorp Q2 beats f’casts, confident of sales growth

* Co says sold record number of two wheelers in Q2Oct 18 (Reuters) - Hero MotoCorp , India’s largest motorcycle maker, reported a better-than-expected 19 percent rise in quarterly profit, and said it is confident of growing sales despite concerns over rising inflation and fuel costs in Asia’s third-largest economy.High interest rates that have dented car sales are expected to benefit two-wheeler manufacturers, with many first-time buyers plumbing for motorcycles or scooters in the world’s second-fastest growing major auto market.”We remain confident of carrying forward the buoyancy in our sales. We expect our retail volumes to peak during the festive month of October,” Hero MotoCorp CEO Pawan Munjal said in a statement. He added the company was expanding capacity to meet the expected demand.Industry motorcycle sales in September rose 20 percent from a year previous, against a 1.8 percent fall in domestic car sales, industry data showed this month.Hero MotoCorp, which ended a 26-year joint venture with Japan’s Honda Motors this year, said it sold a record 1.5 million two-wheelers during the quarter, a growth of 20 percent from a year earlier. The company has targeted sales of over six million vehicles in this fiscal year, Munjal had said in July.The New Delhi-based firm reported net profit of 6.04 billion rupees ($123 million) for its fiscal second quarter ended September, up from 5.06 billion rupees a year earlier. Net sales rose 28 percent to 57.84 billion rupees.Analysts on average expected net profit 5.6 billion rupees on revenue of 58 billion rupees, according to Thomson Reuters I/B/E/S.Raw material costs increased by more than a quarter to 42.64 billion rupees.Earlier this year, Hero Investments agreed to buy Honda’s 26 percent stake in the joint venture, formerly known as Hero Honda, for around $851 million.The deal gave Hero freedom to explore new products and export opportunities in markets where Honda has a presence, a move it had been barred from while in the joint venture, but marked its former partner as a competitor for domestic sales.It also faces growing competition from rivals such as Bajaj Auto .Shares in Hero MotoCorp ended down 0.4 percent on Tuesday ahead of the results, after rising as much as 1.1 percent, in a Mumbai market that fell 1.6 percent.Hero MotoCorp shares, valued at $8.1 billion, are down 0.1 percent this year, compared with a more than 13 percent in the sector index and a decline of over 18 percent in the benchmark index . ($1=49.3 Indian rupees)