29 February 2024

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Eicher Motors

Eicher Motors share price fell over 4%; Check Out:

Eicher Motors’ stock dropped more than 4% on Tuesday after rival Hero Moto Corp and Harley Davidson announced the launch of the X440 in India. Eicher Motors’ stock opened at Rs 3,570 per share on the BSE today.

Thanks to a collaboration between Harley-Davidson and Hero MotoCorp, the X440 is the smallest and most affordable Harley-Davidson motorbike to be introduced in India since the Street 750. The Royal Enfield Hunter 450, which Eicher Motors will soon launch, will compete directly with the X440, which costs 2.29 lakh (ex-showroom).

“In the race for high-end two-wheelers, Harley-Davidson and Hero MotoCorp introduced the X440 in India, which is said to be the smallest and most affordable HD bike ever introduced in India.” This introduction is functioning as a growth barrier for its rival Eicher Motors, which is currently down. Royal Enfield has been the segment’s dominant player. 

Technically, Eicher is weak and may settle around 3400, with an eye on the 200 DMA, which is close to 3304. Prashanth Tapse, Senior Vice President of Research at Mehta Equities, stated, “We remain neutral on this development.”

According to sources, Hero MotoCorp said on Monday that it is placing a substantial bet on a connection with iconic American brand Harley-Davidson and record-breaking product launches on its own in order to strengthen its footprint in the premium segment.

Eicher Motors

The partners emphasised that the collaboration will also allow Harley-Davidson to enter more affordable places, allowing more people to acquire the iconic brand. The Harley-Davidson X 440 is manufactured by Hero MotoCorp’s Neemrana facility and costs between 2.29 lakh and 2.69 lahks (ex-showroom).

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It would also debut a bike on the same platform as the Hero MotoCorp brand in the fourth quarter of the current fiscal year, signifying its entry into the 350cc-500cc motorbike industry in the 3 lakh and above price range. The chairman of Hero MotoCorp, Pawan Munjal, verified a Mint article from last month about a projected 400cc model with its own badge built on the Harley chassis.

Hero MotoCorp’s Harley-Davidson X440 partnership impact on Eicher Motors

In the same segment, Hero MotoCorp’s Harley-Davidson X440 will compete against Bajaj-Triumph’s Scrambler and Speed 400 motorcycles, as well as Royal Enfield’s middleweight variants. New market entrants Bajaj-Triumph and Hero-Harley will attempt to break up Royal Enfield’s monopoly, which it presently has with a share of just about 93% of the 250cc to 500cc motorbike market.

Eicher Motors, on the other hand, recently reported positive June sales results. In comparison to the same period the previous year, total Royal Enfield motorcycle sales grew by 26% to 77,109 units.

According to trendlyne data, the stock price grew 25.6% in the last year while underperforming its sector by 12%.

Analysts predict a significant gap-down opening in prices with large volumes; prices are currently placed at critical support around 3,500, which if broken on a closing basis would cause more weakening into 3,300; immediate resistance is at 3,600.

On the other hand, Hero MotoCorp shares were trading around their 52-week high, up 2.61% at 2,975.35 per share on the BSE.