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November 29, 2020

Royal Enfield recorded bullet sales in October Month

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Royal Enfield, a manufacturer of bike bullets popular among bikers, achieved record retail sales in October. The company’s CEO Vinod Dasari had taken the initiative named ‘Accessibility’ to increase the penetration of entry-level bikes. Under this initiative, the company increased the number of stores during the festive season.

Royal Enfield popular among bikers, recorded bullet sales in October

Sources familiar with the matter said that Royal Enfield sold around 95,000 motorcycles in October, about 50% more than the company’s monthly production of 60,000 bikes.

This is how the company’s profits increased

Royal Enfield’s wholesale volumes in the domestic market were 67,538 units in October, down 3.6%, the lowest in the past 11 months. In the first seven months of the current financial year, the company’s sales volume in the domestic market declined by 16%, due to an increase in the number of advertisements, sluggish sales, and increased competitive pressure.

The company’s CEO told ET that the company had begun work on bringing innovation to the product and process as soon as the slowdown threatened. Royal Enfield launched new variants like the Evergreen Bullet and Classic 350. The company expanded the distribution network by opening 250 new ‘studio stores’ across the country during the festive season. The company benefited greatly from these measures.

Sale increased during the festive season

Dasari said, “Our efforts to increase the availability of products and services started showing color as soon as festive demand started in October. We resorted to several media platforms and in-store activities to reach those interested in the company’s product. ‘ He said that there is a lot of growth potential in small towns and cities.

There was a lot of demand for the company’s product in these areas. He said that these could soon become big markets for middle-weight motorcycles. During the festive season, sales of big brands like Royal Enfield, Maruti Suzuki. Also, Hyundai bounced back, but this was due to long-delayed purchases. However, it will take time for the demand for general purchase of trains.

“We have an eye on the industry trends and consumer sentiment,” says Dasari. We expect the demand to improve gradually over the coming months. A recovery in retail sales volumes and bottom-out of wholesale volumes has given the company a great treat from Dalal Street.

Eicher Motors stock has gained 28% in the last three months, which is three times the strength in the benchmark index Sensex during this period. Eicher Motors, which owns the Royal Enfield brand, is trading at 26.6 times the estimated EPS for the next 12 months. It is one of the most expensive auto stocks.

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