Eicher Motors speeds up after price cut

Eicher Motors jumped 5.47% to Rs 291 at 15:41 IST on BSE after it said it will cut commercial vehicle prices by between Rs 5,000 and Rs 19,000 each, following excise duty cut on busses and their chassis in Union Budget 2008-09.

On BSE, 13802 shares were traded in Eicher Motors counter. The stock had an average daily volume of 58631 shares in the past one quarter.

The stock hit a high of Rs 294 and a low of Rs 273.50 so far during the day. The stock had hit a 52 week high of Rs 599 on 10 December 2007 and a 52 week low of Rs 222.10 on 19 April 2007.

The mid-cap commercial vehicle had outperformed the market over the past one month till 3 March 2008, declining 6.62% compared to the Sensex’s decline of 8.58%. However it underperformed the market in the past one quarter, declining 38.04% compared to Sensex’s decline of 14.60%.

The company’s current equity is Rs 28.09 crore. Face value per share is Rs 10.

The current market price of Rs 291 discounts its Q3 December 2007 annualised EPS of Rs 22.44 by a PE multiple of 13.05.

Excise duties on buses and their chassis were cut to 12% from 16% following Finance Minister’s budget for 2008-09 presented on Friday, 29 February 2008.

Eicher Motors manufactures and sells commercial vehicles, tractors, two-wheelers and gears. Its plants are located at Madhya Pradesh, Tamil Nadu and Maharashtra.

The company reported 11.40% fall in net profit to Rs 15.76 crore on 10.91% rise in net sales to Rs 547.75 crore in Q3 December 2007 over Q3 December 2006.