Eicher Motors Limited Q3 FY26 Earnings Call Summary

Summary

Eicher Motors Limited - Q3 FY 2026 Earnings Call Summary Tuesday, February 10, 2026 5:00 PM

Event Participants

Executives 3 B. Govindarajan (MD, Eicher Motors & CEO, Royal Enfield), Vidhya Srinivasan (CFO, Eicher Motors), Vinod Aggarwal (Vice Chairman, Eicher Motors & MD/CEO, VECV)

Analysts 7 Amyn Pirani, Chandramouli Muthiah, Gunjan, Hitesh Thakurani, Kapil Singh, Pramod Amthe, Pramod Kumar, Yash Agarwal

Financials & KPIs (Eicher Motors Consolidated)

Geographic & Segment Commentary

• Royal Enfield Domestic: Sold 3,00,426 motorcycles (+24% YoY) with best-ever festive performance of 2.49 lakh units in Sep-Oct. Demand is robust across 350cc models; Hunter 350 is seeing a younger buyer profile (ages 23-24).
• Royal Enfield International: Volumes reached 25,347 units (down from 27,068 YoY) due to “calibration” in Europe/UK amid OBD2B pre-registrations. Brazil remains a “North Star” with market-leading growth and plans for a consolidated CKD facility.
• VECV Trucks: LMD trucks grew 28.3% YoY to 12,447 units (34.5% market share); Heavy-duty trucks grew 14.9% to 6,850 units. Performance was supported by government infrastructure capex and improved route economics.
• VECV Buses: Sales fell 3.3% YoY to 3,624 units due to tender timing and lower institutional orders compared to the previous year’s high base.

Company-Specific & Strategic Commentary

• Capacity Expansion: Board approved ₹958 crore capex for brownfield expansion at Cheyyar, Tamil Nadu, to reach 2 million units p.a. by FY 2027-28.
• Electric Vehicle Roadmap: Unveiled “Flying Flea” electric brand; the C6 (Classic style) is nearing production, with the S6 (Scrambler) to follow around EICMA.
• Digital Sales: Partnered with Amazon India for 350cc sales in select cities, following a successful Flipkart tie-up to enable a seamless digital buyer journey.
• Sustainability: Achieved 93% green electricity consumption across facilities and 80% reduction in Scope 1 and 2 emissions intensity.

Guidance & Outlook

Risks & Constraints

Q&A Highlights

Margin Drivers

• Question: What drove the sequential improvement in gross margins and expense control? (Chandramouli Muthiah)
• Answer: Drivers included operating leverage from higher volumes, model mix, and ₹140 bps benefit from cumulative price hikes taken in April/July. (Vidhya Srinivasan)

Capacity Rationale

• Question: Why expand so aggressively and is it for 350cc or larger bikes? (Amyn Pirani)
• Answer: Current plants are running at full capacity (4,300-4,400 bikes/day). Expansion focuses on 350cc modularity but ensures flexibility for 450cc/650cc as the global market recovers. (B. Govindarajan)

GST and Demand

• Question: Has the GST-induced demand shift sustained? (Pramod Kumar)
• Answer: 350cc demand is holding firm with increased walk-ins post-GST rate pass-through. Larger engines (450cc/650cc) saw a sharp post-GST dip but are now showing a faster “rate of recovery.” (B. Govindarajan)

VECV Market Dynamics

• Question: Why did bus market share decline? (Yash Agarwal)
• Answer: Lower institutional/state transport orders compared to a very high base last year; competitors secured larger specific tenders this quarter. (Vinod Aggarwal)

Key Takeaway

Eicher Motors delivered a record-breaking Q3 FY26, characterized by a 23% revenue jump and 30% EBITDA growth. Royal Enfield achieved a milestone of 1 million motorcycles sold YTD, maintaining a dominant 88.9% market share in the Indian middleweight segment. Strategically, the company is doubling down on its long-term growth by committing ₹958 crores to expand production capacity to 2 million units per annum by FY28. While exports are undergoing a “calibration year” due to regulatory shifts in Europe and tariffs in the US, the domestic demand remains buoyant, particularly for the 350cc portfolio. VECV also reported its strongest-ever Q3, benefiting from infrastructure-led truck demand. Despite commodity price volatility, management remains confident in outperforming the industry through product refreshes, value engineering, and the launch of the “Flying Flea” EV brand. Eicher Motors is well-positioned to leverage its robust brand equity and expanded manufacturing footprint to drive sustainable premiumization in the global motorcycling market.