Shares of Eicher Motors experienced a third consecutive day of decline, falling by 2.82 percent in early trade on Thursday, July 07, on the NSE. As a result, the company's market capitalisation has been reduced by over ₹10,000 crore.
The stock dipped following the announcement of the launch of the X440 motorcycle in India by Hero MotoCorp, the country's largest two-wheeler manufacturer, in collaboration with American motorcycle manufacturer Harley-Davidson.
During Thursday’s trade, the stock opened at a price of Rs. 3,250 per share, against the previous close of Rs. 3,309.75 per share and plunged further during the early trading session to touch an intraday low of Rs. 3,216.15.
It was trading at ₹3,222.30 apiece, down by 2.64 percent, at 10:40 a.m. on the NSE.
The stock touched a 52-week high of Rs. 3,889.65 on November 01, 2022 and a 52-week low of Rs. 2,807 on July 06, 2022, indicating that at the current level, the stock is trading 14.7 percent above its 52-week low and 17.1 percent below its 52-week high.
The stock has declined nearly 13 percent in the last one month. However, in the past six months, it has increased by almost 10 percent. Moreover, the stock has yielded a return of over 17 percent in the last one year.
For a considerable time, Royal Enfield (RE) from Eicher Motors has held the throne as the leader of premium motorcycles in India. Its strong dominance can be attributed to its positioning and affordability.
In fact, Royal Enfield's influence has been so substantial over the years that Harley-Davidson, which operated in a higher-end market segment, abruptly withdrew from India in 2020.
However, the American motorcycle manufacturer has now made a comeback and aims to chip away at Royal Enfield's market share.
Harley-Davidson and Hero MotoCorp have unveiled the X440, which stands as the smallest and most affordable Harley-Davidson bike ever introduced in the country since the Street 750. Priced at ₹2.29 lakh (ex-showroom), the X440 directly competes with the Royal Enfield Hunter 450.
The launch of the X440 represents a significant milestone for both Hero MotoCorp and Harley-Davidson as they strive to capture the premium motorcycle segment in India.
Royal Enfield, which accounts for 90 percent of Eicher Motors' profitability, faces a threat not only from Harley-Davidson but also from Triumph's Speed 400 and Scrambler 400X.
Triumph's Speed 400 is a street naked motorcycle that draws design cues from the larger Street Twin 900 and has been competitively priced at ₹2.33 lakh. These models are developed in collaboration with Bajaj Auto.
Eicher Motors Limited is engaged in the manufacturing and selling of motorcycles, spare parts and related services. The company primarily operates in only one segment which is the automotive segment.
According to a MintGenie poll, 38 analysts pn an average have a ‘BUY’ call on the stock.
