Hero MotoCorp to underperform Sensex - Morgan Stanley

Fri Jan 18, 2013 12:47pm IST

A worker cleans a bike inside a Hero MotoCorp showroom in Mumbai January 17, 2013. REUTERS/Danish Siddiqui/Files

A worker cleans a bike inside a Hero MotoCorp showroom in Mumbai January 17, 2013.

Credit: Reuters/Danish Siddiqui/Files

Related Topics

Stocks

   

Reuters Market Eye - Morgan Stanley says Hero MotoCorp's (HROM.NS) shares will fall relative to the Sensex over the next 60 days on the back of "disappointing" Q3 earnings.

India's largest motorcycle maker missed estimates for the fourth straight quarter as net profit fell 20.4 percent on rising costs and falling sales that battered margins.

The investment bank maintains its 'underweight' rating on the stock, while reducing its earnings estimates by 5 percent for FY13, and 3 percent for FY14, saying that the decline in Hero's margins is more structural than cyclical.

"Most of the miss came at the operating level and was attributed to lower gross margins of new launches (Maestro and Ignitor) and increased sales promotion costs," Morgan Stanley said in the report.

Hero MotoCorp has fallen 4.3 percent in 2013 as of Thursday's close, compared with a 2.8 percent rise in the Sensex in the same period.

(Reporting by Abhishek Vishnoi)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

Global Trade Deal

Global Trade Deal

Rural votes, old traumas drive India's WTO brinkmanship.`  Full Article 

E-Commerce Funding

E-Commerce Funding

E-tailer Flipkart raises $1 billion in funding.  Full Article 

Adani Project

Adani Project

Australia approves Adani's $16 bln Carmichael coal project  Full Article 

New Frontiers

New Frontiers

EXCLUSIVE - Goldman moves executive to new role building ETFs.  Full Article 

India-U.S. Talks

India-U.S. Talks

Kerry to woo Modi's India, but quick progress unlikely  Full Article 

Argentina Debt Default

Argentina Debt Default

Insight - Jaded Argentines brace for looming debt default   Full Article 

Anti-trust Probe

Anti-trust Probe

Microsoft targeted in apparent Chinese anti-trust probe  Full Article 

Gaza Conflict

Gaza Conflict

Israel strikes house of Hamas Gaza leader, digs in for long fight.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage