The world’s largest two-wheeler manufacturer, Hero MotoCorp, on Friday reported a 4.9% year-on-year drop in net profit to Rs.574 crore during the January-March quarter — its third straight quarter of profit decline — hit by sluggish sales and intense competition.
The company had posted a profit of Rs.604 crore a year-ago.
Despite the decline, it managed to beat market expectations, which had pegged fourth quarter profit at less than Rs.500 crore.
Total income during the quarter went up 1.8% to Rs.6,146 crore.
For the full fiscal year 2012-13, Hero’s net profit declined 11% to Rs.2,118 crore.
The company sold over 6.2 million two-wheelers during the year, an increase of 2.63% over the previous fiscal.
“It has been a rough year for the overall Indian auto sector. Weak macroeconomic sentiment coupled with subdued consumer confidence adversely impacted the industrial growth and sales volumes,” said Pawan Munjal, managing director and chief executive officer (CEO), Hero MotoCorp.
“Considering the current environment, these are tough times for the auto sector in India and we remain cautiously optimistic about the growth prospects in the near term,” added Munjal.
The firm increased the prices of all its products within a range of Rs.500-1500 with immediate effect, a move that is expected to bolster its profitability.