The country's largest two wheeler manufacturer Hero Honda today posted a better than expected 95 per cent jump in net profit for the July-September quarter at Rs 597.14 crore compared to Rs 306.3 crore last year.
Its net sales also grew 22.8 per cent to Rs 4,040.1 crore against Rs 3,289.7 crore last year.
The company's performance was largely on account of a resurgent economy that saw its sales go up from 9.7 lakh units last year to 11.83 lakh units this year, a growth of almost 22 percent. Hero Honda is now well placed to meet its target of more than 4 million unit sales for fiscal 2008-09. In the first half of the fiscal the company has already sold 2.27 million units.
"Our growth has been uniform across all segments but there are atleast two new areas of growth like scooters and premium segments that have emerged for us," said Anil Dua, senior vice president (marketing and sales), Hero Honda. "We have grown in high double digit so far this year and would definitely be growing in the same way for the whole year."
Though the economy is on the rebound and demand situation is healthy, the company said there were issues that could upset the applecart.
"There are a few ifs and buts in the form of high fiscal deficit and the rising inflation," said Ravi Sood, senior vice president—finance, of the company. "I would not be surprised if RBI decides to tighten the liquidity position before the end of this fiscal itself. In that event, the story may become different."