Eicher Motors Ltd. share price target

We met with Eicher Motors (EIM)’s management to gain insight into the business outlook amid the challenging global macroeconomic environment.

Eicher Motors’ 3QFY26 consolidated PAT at INR14.3b was largely in line with our estimate. While RE performance was better than expected, VECV performance was below expectations.

We upgrade from HOLD to BUY rating on the stock,

RE volumes drive topline Q3FY26; SA revenue grew by 22% on robust domestic growth of 24% YoY. Mid-size share at ~89%

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Industry leading growth to sustain, premium play Improving Profitability, Capacity Expansion and Balanced CV Exposure: EML is entering a phase of improving operating leverage and profitability driven by scale benefits, disciplined pricing, & value engineering despite moderate commodity pressures. VECV adds a strong second growth engine with its best-ever quarterly performance, improving margins and a positive medium-term outlook supported by infrastructure spending & domestic manufacturing push. The company's strategic 958 crore...

Eicher Motor's financial performance continues to demonstrate steady operational *over or under performance to benchmark index momentum across its key segments, providing a solid base for H2FY26. Royal Enfield is expected to sustain its growth trajectory as the company strengths its franchise through launches, platform upgrades and global market expansion. VECV's healthy performance, market by its record sales volume in the second quarter, reinforces confidence that the commercial vehicles segment will add to growth. The company's focus on enhancing product capability through new models and...

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Revenue gain (SA) ~40/20% YoY/QoQ to Rs 59bn, driven by healthy volume gains realisation listless in the motorcycle segment

GST Rationalization: Structural boost for the industry: Government has announced GST 2.0 reforms thereby reducing GST rates for the automobile sector across the segments and value chain, small cars, 2-W's up to 350cc, and 3-Ws will now attract 18% GST vs. 28% earlier which enables the 2W domain to expect healthy volume growth in FY26E led up upbeat demand sentiments in the rural economy amid healthy farm produce and positive 2025 monsoons. Domestically, RE dominates in the premium segment, where it has a ~84% market share in the 250-750cc category. RE drives...

We recommend a HOLD rating on the stock

Eicher's 2QFY26 consolidated PAT at INR13.6b was slightly lower than our estimates of INR14.4b, due to lower-than-expected margins in both segments.

Eicher Motors’ (EIM) Q2FY26 standalone EBITDAM came in at 24.9%, 80bps below I-Sec estimate. Marketing / brandbuilding efforts and regular product interventions have been driving the outperformance for RE in domestic market.

Looking ahead, Eicher Motors is well placed to capitalise on rising premiumisation trends and sustained rural demand. Its strategy to broaden customer base, particularly by targeting a younger demographic, is gaining traction and is expected to further fuel its growth trajectory. Additionally, continued momentum in the export market, supported by robust demand and expansion initiatives, bodes well for its future performance. With a strong pipeline of upcoming launches and continued progress on its EV roadmap through the Flying Flea brand, the company is poised...

We recommend a HOLD rating on the stock.

Revenue gain ~16% YoY (-4% QoQ) to Rs 49bn, driven by healthy volume gains realisation listless in the motorcycle segment

Eicher Motors’ (EIM) Q4FY25 standalone EBITDAM came in at 24.7%, 130bps below I-Sec estimate. Elevated marketing / brand-building efforts and regular product interventions have been driving growth for RE in domestic market.