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

Diwali Sales

Diwali Sales

Gold sales jump about 20 pct for Diwali - trade body  Full Article 

World Bank Rival

World Bank Rival

Three major nations absent as China launches W.Bank rival in Asia  Full Article 

Wal-Mart India

Wal-Mart India

Murali Lanka appointed as Wal-Mart India operations chief  Full Article 

Microsoft Earnings

Microsoft Earnings

Microsoft sales beat Street hopes, cloud profits up.  Full Article 

Special Report

Special Report

Why Madrid's poor fear Goldman Sachs and Blackstone  Full Article 

U.S. Economy

U.S. Economy

Spectre of no-inflation world looms over Fed's return to normal  Full Article 

Insider Trading

Insider Trading

Rengan Rajaratnam, SEC to settle civil insider trading charge.  Full Article 

Market Watch

Market Watch

Betting on the beaten up? Investors pin hopes on stocks in Europe, Japan.  Full Article 

India Insight

India Insight

Kalki Koechlin on her role as a disabled girl in “Margarita, With a Straw”  Full Article 

Reuters India Mobile

Reuters India Mobile

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