eicher motors ltd share price Management discussions

In the Management Discussion and Analysis, all the numbers pertaining to Eicher Motors Limited ("EML") refer to consolidated numbers.


Royal Enfield has launched its most awaited motorcycle - The All-New Classic 350 - in September 2021, with a resounding response from consumers. The new motorcycle takes forward the legacy of its legendary predecessor while significantly elevating the riding experience and is re-imagined to meet modern expectations. It is available in 5 variants with 11 colorways. The new Classic 350 also created a new benchmark for digital launches, including a Guinness World Record, as more than 19,500 concurrent viewers joined the live webcast on the launch day.

Since its debut in India, the All-New Classic has been launched in APAC as well as made its debut in Europe at EICMA 2021. The new motorcycle has received many awards globally from leading automotive publications. The All-New Classic has been leading the domestic sales charts among the motorcycle with over 125cc category in the second half of the year and ‘your Company has shipped more than 200,000 units of new Classic since its launch in the year, despite supply chain constraints.

Scram 411: The ADV Crossover – expanding the adventure play

Royal Enfield unveiled the Scram 411 - the brand’s first ADV crossover and a new sub-category that is optimized for agility as well as challenging terrain. Available in a vibrant array of colorways across 3 variants, the motorcycle has been received well by consumers and experts in India. Since the launch in India, Scram 411 managed to carve out its own niche and has expanded Royal Enfield’s presence in the fast growing adventure category. Scram will be rolled out in EMEA and APAC markets around mid-2022.

650 Twins: 120th Anniversary limited edition: Gone under 120 seconds! Royal Enfield debuted the 120th Year Anniversary Edition of its flagship 650 Twins motorcycles, the Interceptor 650 and the Continental GT 650 at EICMA 2021. The two premium, special edition motorcycles with a limited production run of only 480 units globally, were distributed as 120 units each for India, Europe, Americas and South-East Asia. The motorcycles have been launched via online auction in India and Europe, where they have received incredible response and were sold out in under 120 seconds.

Meteor 350: Opening up easy cruising proposition around the world

After a successful launch in India in November 2020, Meteor 350 was launched in the USA, UK, Europe, Asia Pacific and Latin America. The motorcycle has received encouraging response from consumers and experts, and it continues to win numerous awards – including the prestigious MCN Retro Motorcycle of the year for 2021. Meteor has opened up the easy cruising segment and continues to deliver on our commitment to grow and expand the middleweight motorcycles segment globally.


Royal Enfield – the oldest motorcycle brand in continuous production – celebrated its 120th year in existence in 2021 and continues to nurture the spirit of pure motorcycling through a host of unique motorcycling experiences and programs.

120th year anniversary: Tracing the origins at EICMA; showcasing future

As Royal Enfield completed its 120 years anniversary in 2021, the Company showcased its legacy and heritage at EICMA 2021, the annual global motorcycle show at Milan, Italy. The Company unveiled the Royal Enfield SG650 Concept motorcycle, marking another chapter in its journey of creative expression and product development. Royal Enfield also debuted the 120th Year Anniversary Edition of the brand’s flagship 650 Twin motorcycles, the Interceptor 650 and the Continental GT 650 at EICMA 2021. The motorcycles received an incredible response in India and Europe, and were sold out in under 120 seconds each. Royal Enfield also unveiled ‘Project Origin’, at EICMA. This motorcycle is a working replica of the brand’s very first ‘motor-bicycle’ from 1901, the very machine that laid the foundations upon which Royal Enfield’s enduring legacy of ‘Pure Motorcycling’ is built.

90? SOUTH: Pushing the boundaries for adventure

A significant celebration of the 120-years milestone was an extraordinary endeavour to reach the geographic South Pole. Conceptualised as an ode to the Royal Enfield rider community, 90? SOUTH saw two Royal Enfield Himalayans accomplish the unthinkable feat of traversing the treacherous journey to the South Pole. Two company employees successfully completed this expedition in 28 days, in December 2021.

One ride 2021: #LeaveEveryPlaceBetter

After a hiatus of a year in 2020, the brand conducted the 10th edition of One Ride, one of the world’s largest curated single-day rides, in September 2021. Held across 35 countries, One Ride 2021 focused on encouraging responsible travel practices amongst the global riding community in a bid to


Fostering fiat track racing in India, EMEA and USA

Royal Enfield furthered its commitment to foster fiat-track racing with the introduction of its Slide School programme in the UK. The UK Slide School joins existing fiat-track programmes in India and the USA. Royal Enfield secured the top 2 places in the inaugural season of the Dirt Track Riders Association in the UK, followed by a first ever half mile win at the American Flat Track Lima, Ohio Half Mile race. To encourage more and more enthusiasts from diverse backgrounds to embrace riding, ‘your Company introduced the second edition of the Build.Train.Race (BTR) - women’s only racing program in the USA.

Continental GT Cup

Royal Enfield marked its maiden foray in motorsports this year, with the first edition of the Continental GT Cup 2021. Launched in partnership with JK Motorsports, The

Continental GT Cup sits at the intersection of increasing interest in motorcycle track racing, and the need for accessible forms of racing and training in India. Season 1 of the Continental GT Cup was kick-started to a resounding response from racing enthusiasts at the Kari Motor Speedway and Racetrack in October 2021.

Seema Bhawani Shaurya Expedition

Continuing to strengthen its 70-year association with the Indian armed forces, Royal Enfield partnered with the Border Security Force - BSF for a one of its kind, all women - Seema Bhawani Shaurya Expedition motorcycle ride. Conceptualized to propagate the message of women empowerment, and celebrate women’s achievements, the Seema Bhawani Shaurya Expedition 2022 saw 36 women riders traverse across the country on Royal Enfield Classic 350 motorcycles for over 5200 kilometres with an intent to sensitize and build more awareness about the capabilities of women while emphasizing freedom from bias, stereotypes and discrimination.

Art of motorcycling: Second edition

Royal Enfield’s designing platform was rolled out in 2020 as an avenue for artists, creators and motorcycling enthusiasts to express their love for motorcycling through creative illustrations. The second edition of the campaign which concluded in February 2022, attracted 15,000 registrations, 50% more than the inaugural edition. It is noteworthy that 80% of the participants were non-Royal Enfield owners and the largest participation came from small cities and towns, demonstrating the aspirational pull of the Royal Enfield brand across geographies and consumer segments.

Helmets for India

Royal Enfield partnered with Helmets For India, a not-for-profit creative initiative that aims to positively influence perceptions about wearing helmets and improve road safety in India. This collaboration is envisaged to unlock the potential of widespread and passionate Royal Enfield communities and retail networks for Helmets For India, providing the initiative a larger canvas to mobilise in-uential voices and inspire action towards the cause. This partnership also enables Royal Enfield to deepen its commitment to its social mission of Responsible Travel and to encourage adoption of safe riding gear, especially helmets.

MiY: Pan India coverage in 2021

Make It Yours - An industry-first personalisation initiative with a paradigm shift in customer purchase journey is now available at all 2,100+ stores. your Company has not only expanded the MiY coverage for all motorcycle models on offer, but also has increased the number of accessories/parts available on the platform. As a result, MiY adoption and GMA penetration have been growing consistently.

REBALANCE - A larger purpose for EML

As the world urgently evaluates how to ensure a brighter future for generations to come, it is now clear that EML needs to recalibrate and renew its mission so we continue to make a significant contribution to society – not just as a corporation, but as a force for good. With a strong and robust business model, led by pure motorcycling, we will now adopt a larger purpose to REBALANCE - balance profit and profitability, balance social and commercial objectives, balance the existing product portfolio of internal combustion engines and the future with electric vehicles, balance a strong brand-led customer experience. This, combined with our razor sharp business strategy, including key focus areas like electric vehicles both at VECV and Royal Enfield, will fuse together to form a holistic mission for Eicher Motors Ltd


Domestic Two-wheeler Industry Performance

The industry clocked total sales of 13.9 million units in 2021-22, registering a decline of ~11% from 15.1 million units in the previous year. The motorcycle industry sales volume stood at 9 million units in 2021-22, registering a decline of ~10% from 10 million units in 2020-21. The fall in sales in the scooter industry remained in-line with motorcycles, declining from 4.5 million units in 2020-21 to 4 million units in 2021-22. The two-wheeler industry in India went through another challenging year as it was impacted by the uncertainties and restrictions on account of COVID in Q1, followed by severe supply chain constraints. Although the demand started showing signs of recovery in the second half of the previous year (FY 2020-21), the second wave of COVID in the first quarter of the financial year resulted in subdued consumer sentiments. This was followed by a global shortage of semiconductors from the second quarter leading to a severe supply shortage for motorcycles and a muted festive season. A sharp surge in the prices of key commodities such as Precious metals, Aluminium, Steel, Crude oil, Copper etc. led to a significant increase in the overall cost of ownership of motorcycles across models. The industry has shown steady recovery since then, however, volumes are yet to return to the pre-pandemic level

Royal Enfield Performance: Strengthening its presence

Royal Enfield’s total sales volume (including international business) stood at 5,95,474 units in 2021-22, reporting a decline of 2% from 6,09,403 units in 2020-21. Notwithstanding the prolonged supply side constraints, \ actively pursued development of alternate vendors to steadily improve production. During the year, your Company transitioned its most loved motorcycle Classic to the all-new J-Series platform and launched a new ADV crossover Scram

411 in domestic markets. Both the motorcycles received an excellent response from customers. In 2021-22, 5,21,236 units of Royal Enfield were sold in India, registering a 9% decline year-on-year (from 5,73,728 units). The India business constitutes about 88% of total sales volumes. The market share for Royal Enfield in the motorcycles industry improved marginally to 5.8% in the current year (up from 5.7% in the previous year).

In the motorcycles with engine capacity above 125cc segment, the market witnessed a drop of 18% year-on-year to 1.8 million units. However, your Company’s market share in this segment increased to 28.7% in the current financial year marking an increase of 2.8% over previous financial year. The launch of Royal Enfield Classic 350 in September 2021 and Scram 411 in March 2022 boosted the Company’s resilience in this segment. The industry volumes for motorcycles with engine displacement above 250cc, declined by 6%, registering total sales of about 0.58 million units, reflecting the expansion of the category as more players entered the segment. While Royal Enfield continues to be the leader in this segment, its market share decreased marginally from 94% to 90%, partly impacted by supply constraints.

Your Company was able to partially offset the weakness in the domestic market by a strong focus on international business, which registered sales of 74,238 units, representing a growth of over 108% (35,675 units in 2020-21).

Enhancing Customer Experience and Satisfaction

Royal Enfield accords the highest importance to enhancing consumer experience and service excellence at all touchpoints. With the roll out of the Make it Yours (MiY) initiative across the complete range of motorcycles, along with a wide range of genuine motorcycle accessories, riding gear and apparel, Royal Enfield offers access to an unhindered, authentic pure motorcycling experience for our consumers. The Royal Enfield application (RE App) now provides a holistic platform for consumers to explore, personalize, accessorize and book their motorcycles. Moreover, the RE App features a con-gurator that provides buyers access to several thousand combinations of colourways, trims, graphics and accessories, to create uniquely customised motorcycles. With the aim of enhancing consumer’s experience and satisfaction, ‘your Company rolled out numerous initiatives to ensure anxiety-free ownership experiences. your Company has launched The Ride Sure programme during the year with a wide range of packages including extended warranty, annual maintenance options and extended roadside assistance. The unique Service on Wheels (SoW) initiative which provides doorstep delivery of services and roadside assistance including motorcycle pick-up and drop-o- after servicing, has significantly improved the ownership experience for Royal Enfield consumers. Moreover, Royal Enfield initiated the Service Care 24 program, which so far has been successful in returning over 170,000 erstwhile customers (~6% of the total) to the Royal Enfield fold. As a result, your Company has seen significant improvements in the overall consumer satisfaction score at the delivery stage as well as service stage, despite shortage of supply owing to production constraints.

Further, amidst a sharp inflationary backdrop for the two wheeler industry, ‘your Company took several steps to uplift the demand such as - introducing accessible and innovative financing options, strengthening the retail network across the country and launching of new motorcycles (new Classic and Scram 411). Despite the tough market conditions, your Company bolstered its digital capabilities to enhance its reach to consumers. Moreover, Royal Enfield steadily expanded its sales and service network to 2,118 touch points across India – which includes 1,063 dealerships and 1,055 studio stores - and covers over 1,750 cities in India.

Financing options to drive growth

The aspiration to own a Royal Enfield remains strong among the motorcycle consumers across the country, further enhanced by an expanding product portfolio and multiple options for personalisation. The improved availability of finance can enable potential customers to fulfil their aspirations. Further, financing assumes greater importance with growing pressure on income sources and rising motorcycle prices. During the year your Company has worked with multiple leading financiers to roll out attractive financing schemes to prospective consumers. Not only were more financiers on-boarded to expand available options at dealerships, but your Company has also steadily worked towards exploring affordable options by 1) focusing on low down payment requirement (as low as 15%), 2) lower EMI payments by extending loan tenures (over 4 years), and 3) low interest schemes. As a result, finance penetration among consumers steadily improved to 52% by March 2022 as against 44% in April 2021. During the current financial year, your Company launched an industry-first digital finance marketplace (DFM) with two financiers currently on board. The Company aims to scale up the DFM model by adding more financiers in the coming year.


Royal Enfield’s Global Performance

In 2021-22, your Company has made remarkable progress in its long term ambition of becoming a premium global consumer brand from India offering access to an unhindered, authentic pure motorcycling experience. During the current year, your Company has made significant strides towards unlocking newer opportunities in international markets led by expansion of our international footprint and commencement of operations in key markets such as Singapore and Netherlands. Royal Enfield has registered sales of 74,238 units in international markets during the year, which marks a stellar growth of over 108% year-on-year. Your Company’s focus on growing its international business has resulted in an increase in the share of export volume to 13% in 2021-22 from 6% in 2020-21. your Company’s revenue from International business (Including non motorcycling overseas business) stood at Rs

1,732 crs for FY2021-22 implying a stellar 104% year on year growth and accounted for ~17% of overall revenue for this year, 7% higher share as compared to FY 2020-21, which underscores the in-roads Royal Enfield has managed to cover in its quest to become a global consumer brand.

Your Company is committed to expanding and leading the middleweight motorcycles segment (350cc-750cc) globally. Royal Enfield is currently present in 60+ countries and operates via five subsidiaries across multiple continents. Its global retail network (outside of India) spans over 840 touchpoints with 165 exclusive stores and 678 multi brand outlets (MBOs). Moreover, your Company strengthened its global presence by adding two new local assembly units in Colombia and Thailand, in addition to an existing facility in Argentina.

Europe, Middle-East and Africa (EMEA) Market: Royal Enfield geared for faster strong growth

The EMEA markets – the largest market region for Royal Enfield this year - accounts for 41% of Royal Enfield’s international volumes and reported a growth of over 185% year-on-year for the financial year 2021-22. Your Company has an expansive network of 46 exclusive stores and 400+ multi-brand outlets in the region. Your Company gained around 7% market share in EMEA’s middleweight segment in 2021-22 as against below 2% market share in 2018 (prior to the launch of Twins). In the EMEA markets, Royal Enfield has been growing at a rapid pace (~50% CAGR) over the last 5 years and has managed to expand the middle weight category in the region. In this region, the two-wheeler market grew nominally by 1.7%, the motorcycle market by 5.9% and the middleweight motorcycle segment by 11.1% in the same time frame. Royal Enfield’s ranking in the middleweight motorcycles has improved by 2 positions to 5th rank in the current financial year, from 7th rank in 2020-21. Moreover, Royal Enfield was placed 2nd in the UK’s middleweight motorcycle segment with over 18% market share. In France, brand Royal Enfield now ranks 4th in the segment.

Royal Enfield launched Meteor 350 in the EMEA markets in 2021 and it has won the prestigious MCN Best Retro motorcycle award. The model has received an extremely positive response from the consumers, especially from the mature riders, younger riders and women riders. Earlier, Royal Enfield Interceptor 650 has won the MCN Best Retro Motorcycle award consecutively for two years. The new variants of 650 Twins and Himalayan continue to attract positive response from consumers. The new Classic 350 has been recently made available in the region. The acceptance of Classic in the region has been extremely encouraging, reflecting the popularity of Classic in the region. your Company has launched The Riders Club of Europe in April 2021, which has attracted over 9,000 members in its first year of inception. The Club has conducted over 500 rides in the region and enabled Royal Enfield to engage more with consumers and brand loyalists. Amidst uncertainties around COVID in the region, Royal Enfield has rolled out the City Test Ride Tour during April – October 2021. Under this initiative, over 2,300 test rides were undertaken from 47 locations across Europe.

Royal Enfield celebrated its 120th year anniversary at EICMA 2021 at Milan, where it showcased its heritage (Project Origin), journey (one motorcycle from each decade) and product capabilities (SG650 concept). Moreover, ‘your Company also launched 120 limited edition, premium variants of popular 650 Twins in the EMEA region, which were sold out in less than 120 seconds.

Royal Enfield’s Tours and Experiential Partner base has expanded across Europe during the year to 16 partners, which offer an attractive Usership experience before ownership across the EMEA region. Moreover, as part of the entry strategy for Africa, Royal Enfield has collaborated with Tours and Rental partners in four countries for the Wanderlust Initiative, to build aspiration for the brand among the locals.

Americas – Emerging as largest market outside India

The Americas – Including North and South America – is among the fastest growing overseas markets for Royal Enfield. Sales of RE motorcycles have clocked a growth of 135% year-on-year in the American region, and accounted for around 35% of the international business volumes. your Company has an expansive network of 70 exclusive stores and 175 multi-brand outlets in the Americas region. Royal Enfield’s market share in the middleweight segment in the Americas region climbed up-to 5% in the year 2021 from 1% in 2018. Within the region, Royal Enfield’s market share stands at around 9% in Argentina, followed by 6% in Colombia, 4% in USA and 3% in Brazil. Royal Enfield launched Meteor 350 in the Americas during the year and it has garnered immense response from consumers across all countries. In addition, new variants of popular models such as Himalayan, Interceptor 650 and Continental GT 650 have seen good traction in the region. Royal Enfield operates two Completely Knocked Down units (CKD) assembly facilities in the region. The first facility was launched in Argentina through its partner in September 2020. This facility has already assembled over 5,000 units so far. The second assembly unit based in Colombia, commenced operations in October 2021.

During the current financial year, Royal Enfield conducted and actively participated in multiple distinguished racing events such as the Mono Anatomy (American Flat Track), Build. Train.Race (BTR) Road race USA, BTR Flat track Brazil, and BTR Flat track USA. Your Company also participated in over 40 activation events across America and conducted many distinguished rides and events such as - Tour of Argentina, Tour of Colombia and Gladiadores Colombia.

Asia Pacific (APAC): The region with exceptional potential

Royal Enfield’s presence in the Asia Pacific (APAC) markets has increased significantly over the last 4 years and ‘your Company has started operations in Singapore during the year. The region accounts for 14% of overseas volumes and holds immense potential for middleweight motorcycles and in particular, Royal Enfield. The Royal Enfield footprint in the APAC markets is represented by 148 dealerships, comprising 48 exclusive stores and 100 multi-brand outlets. Australia & New Zealand account for 53 touchpoints, Thailand has 29, Japan houses 23 and South Korea makes up the balance with 12 stores. your Company has witnessed 2.5x volume growth in the region in the last 3 years with its market share rising from 2% in 2018-19 to 7% in 2021-22. Royal Enfield has now gained over 15% market share of the middleweight motorcycle segments in key markets of the region such as – Australia, New Zealand and South Korea and over 7% in Thailand from under 4% share in FY2018-19.

In the APAC markets, Royal Enfield motorcycles have elicited excellent customer responses over the last 3 years on the back of Himalayan and 650 Twins. Introduction of Meteor 350 in all key markets during the year opened up the easy cruising proposition in the region and the motorcycle won multiple awards in the region. your Company has also launched Classic 350 in the later part of the year in the APAC region, and the motorcycle has generated a massive appeal among the retro motorcycle enthusiasts owing to its timeless design, refinement levels and ease of riding.

Royal Enfield further strengthened its presence in the region with an exclusive local assembly unit and CKD facility in Thailand. This move boosts Royal Enfield’s presence in South East Asia and reafirms the brand’s commitment to the Asia Pacific region. your Company has started operations from Thailand’s CKD facility in FY2021-22 and plans to start exports from this facility in the coming year. In the region, your Company’s strategy to enhance consumer experience and satisfaction with Royal Enfield is multi-pronged and comprises numerous initiatives including collaborations with leading apparel brands such as Saint Apparel in Australia and Eiger Clothing in Indonesia. Royal Enfield has curated engagements with GoPro, a leading sports electronics brand, for consumers and the community. In the current financial year, iconic marquee rides and community engagement activities like the Tour of Thailand and Tour of Indonesia were successfully organised to grow and strengthen an already vibrant Rides and Community culture.

SAARC: Resilient volume driver, led by Nepal

Within the SAARC nations - your Company has operations in Nepal, Bhutan and Sri Lanka. For FY 2021-22, volume contribution from SAARC nations stood at 10%, delivering stable volumes. Amidst the tough macroeconomic backdrop - COVID related challenges and economic fluctuations, ‘your Company focussed on maintaining stability for its operations and channel partners.


Royal Enfield offers the pure motorcycling experience which encapsulates rides, hassle free ownership, personalization, easy maintenance and holistic care for motorcycles. Over the years, ‘your Company has worked towards enabling consumers to customize and personalize motorcycles that reflects their own personality, while offering consumers complete peace of mind by providing comprehensive and convenient maintenance options. your Company has reported sharp 45% year on year growth from non-motorcycle businesses such as spare parts, accessories, apparels and services. The non-motorcycles revenue stood at Rs 1,587 cr for FY 2021-22 and the business accounted for 15% of overall revenue, ~3% higher share as compared to FY2018-19, which underscores the in-roads Royal Enfield has managed to cover in an attempt to provide its consumers a holistic platform to display their own personality.

After Sales, Service, Genuine Parts

Your Company is committed towards ensuring smooth and hassle free ownership, and a fun riding experience for consumers. The segment has clocked a revenue growth of 40% year on year. With a focus on delivering best-in-class service experience and bolstering its digital capabilities, Royal Enfield took multiple initiatives during the year –

Spare parts availability: Your Company worked towards building a resilient supply chain with a lean inventory and ensured parts availability at the retail counter and workshop. Royal Enfield has fully implemented the auto replenishment model for all channel partners and the availability of parts has improved to 98.4% including goods in transit.

Reducing turnaround time (TaT): Royal Enfield is first in the industry to monitor turn around time (TaT) rather than reach time, when providing roadside assistance. The time taken for returning a vehicle back on road is a key determinant of customer satisfaction. Royal Enfield has implemented measures at the workshop level to improve the overall turnaround time, which has resulted in 90% of vehicles on average being readied for delivery within 8 hours.

Service Care 24: The initiative was successful in returning over 1,70,000 erstwhile customers (~6% of the total) to the Royal Enfield fold. The Extended Service Warranty programme (designed to cushion customers against expensive repairs after the expiry of the manufacturer’s warranty) witnessed increased penetration from 62% in FY 2020-21 to 72% in FY 2021-22.

On the sales and service front, 3,045 new authorized mechanics and 1,980 new retailers for spares were added in FY 2021-22. Moreover, our 1,055 studio stores, in addition to 1,063 dealerships, expand RE’s service coverage to over 1,750 cities.

Along with providing after-sale services, your Company understands the importance of end-of-life management of its vehicles. The scrappage policy announced by the Ministry of Road Transport and Highways, India in March 2021 encourages customers to scrap their vehicles at the end of life which will drive efforts towards maximising recycling. While your Company already uses recycled raw materials in its products, it would like to extend its initiatives to include reused / recycled vehicle scrappage. The after-sales team is planning to educate consumers and encourage them to assist your Company in its efforts to increase the percentage of recycled raw materials.

Genuine Motorcycle Accessories: Ease of personalization

Royal Enfield motorcycles are known for their ease of personalisation and customisation, and over the years, consumers have inspired your Company with their customised or personalised Royal Enfield motorcycles that reflect their own personality in a certain sense. Your Company’s genuine motorcycle accessory (GMA) sales have experienced the strongest ever growth regardless of the industry-wide challenges. The portfolio of accessories now stands at 237 products from 180 products in 2020-21, and ‘your Company is working towards increasing it further. In terms of popularity, the protection category continues to be very strong with products such as engine guards, sump guards selling well. Cast alloy wheels are also proving a popular choice among the consumers, as are seats and seat covers. During the year, the team was also focussed on improving the distribution model for accessories. GMA Business has established 3 Supply units in India in FY21-22 where the GMA Mother Warehouse is in Jaipur plus the additional satellite Warehouses in Bangalore & Guwahati.

Apparel: A channel for expression for riders

Rider apparel and gear is a huge form of self-expression for motorcycle riders. The jacket, gloves, protective riding gear, the helmet and other safety guards on the rider, are all part of the motorcycling lifestyle that each rider aspires to lead. Strengthening its digital presence in the service domain, your Company introduced online features to offer frictionless after-sales experience to its customers. Inspired by the shared legacy of pure motorcycling and timeless design, Royal Enfield joined hands with Belstaff, a leading British heritage brand, to bring out an exclusive range of apparel that commemorate Royal Enfield’s 120th anniversary. The exclusive collection includes a range of heritage-inspired t-shirts, zip-up sweatshirts, caps, enamel mugs as well as two masterpieces, the limited edition Royal Enfield x Belstaff waxed jackets - Trialmaster jacket and the Brooklands armoured motorcycle jacket.

The anniversary celebrations were also marked with the launch of 12 limited edition helmets. With hand painted designs by artists, each helmet represents a decade of Royal Enfield motorcycling and enables enthusiasts to own and wear a piece of Royal Enfield history. Always cognisant that the helmet is the most important piece of safety gear, this limited edition range incorporates classic design, history and technology to provide enthusiasts optimum safety, protection and comfort. In another tribute to the brand’s emphasis on authenticity and safety, Royal Enfield and TCX collaborated to offer a range of CE Certified protective riding and lifestyle shoes. Royal Enfield also became a member of the Better Cotton Initiative (BCI), to contribute to improving cotton farming globally and to source cotton more sustainably for its apparel range. Your Company is committed to sourcing 100% of our cotton requirements through Better Cotton by 2023.


Eicher Motors Limited made concerted efforts during the year to deliver positive results towards its Environmental, Social and Governance (ESG) vision. your Company continues to work towards establishing more conscious ways of doing business by striving to minimise its emission footprint, making environment-friendly choices, and caring for its people and communities which help it grow. As an enabler of Pure Motorcycling, Royal Enfield takes responsibility for promoting a healthy balance between man, machine and terrain. helmets and improve road safety in India. In addition, Royal Enfield’s marquee ride – One Ride 2021 was focused on encouraging responsible travel practices amongst the global riding community in a bid to #LeaveEveryPlaceBetter. your Company continues to make use of certified recycled raw material for its motorcycles, parts, accessories and apparel. Your Company is also working to raise awareness of these actions through eco-labelling and customer awareness campaigns. EML has also made progress in implementing principles of circular economy in its operations, which have helped to maximise resource utilisation while supporting efforts to achieve the goal of zero waste to landfills. The health and safety of your Company’s employees and workforce is fundamental to its operations. The comprehensive Occupational Health & Safety (OHS) management system continues to be rigorously followed across all manufacturing units and includes the surrounding communities as well. Moreover, supply chain partners of ‘your Company are being engaged actively, in our quest to make holistic improvement on ESG, with a long term perspective and vision of always being a responsible organisation in this context. In recognition of these efforts, Dow Jones ranked EML as one among only ten global automotive companies to feature on its elite list of Dow Jones Sustainability Indices 2021 (DJSI) in the Emerging Markets category. your Company was ranked among the top 10 global automotive companies.


Your Company’s production facilities have navigated through multiple challenges during the year, ranging from onset of the second wave of COVID, to severe supply side constraints. Yet, Royal Enfield and its supply chain partners have delivered a resilient production for the year, while rolling out the All-New Classic - its most loved motorcycle - on an all new J-series platform. The resounding response to J-series underscores Royal Enfield’s agile, global and world class product development capabilities, which are also focused towards in-house development and integration of emerging technologies. your Company also expanded its global production footprint to three countries during the year, and plants in India played a crucial role in smooth ramp-up. The concerted endeavours of the complete value chain enabled Royal Enfield to continue to remain agile and deliver world class motorcycles as well as services seamlessly across all markets. your Company continues to consistently raise the bar with the launch of each new product and sets new benchmarks in terms of product quality, performance and service.

Inducting sustainable production methods amidst multiple challenges

The current financial year, similar to the previous year, continues to witness the impact of the pandemic – Initially in India, but later in many other overseas markets. With the second wave of COVID running through most of Q1 FY2021-22 in India, our manufacturing and retail operations were affected due to lockdown and restrictions. Resumption of production activities after the lockdown was enabled through proper coordination with the Company staff and government authorities while ensuring complete safety of employees and all immediate stakeholders. On the logistics front, particularly for shipments to overseas destinations, availability of containers, frequency of shipping lines etc. posed challenges to the industry. Your Company handled these constraints by taking both short-term and long-term measures which resulted in accomplishing international business plans and driving the global aspirations of your Company.

Your Company also acknowledges global climate change as a major environmental concern. It has prioritised its efforts in reducing energy and water use, waste generation, and GHG emissions associated with its manufacturing facilities to mitigate the negative effects and ensure a sustainable future. Royal Enfield’s manufacturing prowess and focus on ESG was also recognised by Frost and Sullivan and TERI during the Sustainability 4.0 awards. Royal Enfield’s Vallam Vadagal facility received the ‘Frost and Sullivan Gold’ Award for Manufacturing Excellence.

In addition, your Company is also looking at extending its initiatives to its value chain partners including suppliers, dealers, consumers as well as end of vehicle life management. To this effect all of its manufacturing facilities are ‘Zero Liquid Discharge’ plants, two of which have been certified as water positive. In addition, improvements have been made in terms of efficient use of packaging with focus on Reduce, Reuse and Recycle. For example, your Company packages multiple kits into a single package for global shipments and have introduced the environment friendly recyclable poly packages. As your Company strives to become the industry leader in customer satisfaction, multiple steps have been taken to provide timely service – thereby reducing turnaround time, and to ensure spare parts availability across the network. During the year, the centralized spare parts facility at Oragadam plant aided the successful rollout of the auto replenishment model for spare parts across all channel partners enabling wider reach yet leaner channel inventory.

World class product development capabilities with focus on quality

Royal Enfield’s J series platform made its mark globally this year as the Meteor 350 has been introduced across all major overseas markets, and it continues to win multiple accolades globally, including the prestigious MCN’s Retro Motorcycle of the Year. Meteor has opened up a light cruiser segment in many markets with its ease of handling and ability to effortlessly cruise on highway speeds. Moreover, the motorcycle has garnered resounding reception and delivered consistent performance despite significant variation in operating conditions such as Brazil (E20 Gasoline) and Europe (Euro V compliant). Royal Enfield’s new range of products - 650 Twins, Himalayan, Meteor 350, New Classic - and their global performance, are a testament to ‘your Company’s world class product development, production and quality control capabilities. The high standards of design and validation applied throughout the development of the motorcycle alongwith the state-of-the-art facilities at both the technical centres – India Tech Centre at Global Headquarters, Chennai and UK Tech Centre - are the enablers of the world class product range. Your Company has been working on continuous improvement of its development capabilities, and has a focused plan to develop and augment the future technologies.

The "Shoki Ryudo Kanri" (SRK) process continues to be the foundation for ensuring that initial product quality levels meet and exceed global expectations. Your Company and its supply chain partners continued to embrace this process and delivered yet another world class product in the form of the New Classic. Your Company is committed towards development of its supply partners to be future ready with required technologies and processes to offer best-in-class products and service, by concurrent development, early involvement and long term planning in all the areas of business to emerge stronger and better as it powers forward.

Electric vehicle development: Long term consumer focused strategy

The robust electric vehicle product and business strategy is at the core of ‘your Company’s long term sustainability plans. Globally, major two wheeler markets (Including India) are gradually shifting towards sustainable mobility options - which includes personal electric two wheelers. Currently, the EV ofitake is supported by policy-led initiatives such as incentives or restrictions or both in many markets. The potential electrification of the premium motorcycle space is in its nascent stage, and to meet key consumer requirements such as longer range, higher performance, extreme durability, charging network and cost effectiveness

(without incentives) further technological breakthroughs are required. Royal Enfield has global ambitions of emerging as a premium consumer brand and ‘your Company has forged a long term, global and consumer centric product as well as business strategy for electric vehicles. The development work is in progress with dedicated resources and a sharp focus on future technologies. The product(s) will follow Royal Enfield’s world-class product development cycle and will undergo its well proven global testing and validation cycles before it is launched in the markets around the world.

Aligning for expanding International operations and CKD facilities

With a focus on expanding global presence, your Company has started setting up Completely Knocked Down (CKD) facilities in key export markets. These facilities include an assembly line for production of a motorcycle kit and a separate facility for its packaging. During the year, Royal Enfield has started two new CKD facilities in Colombia and Thailand – in addition to an existing facility in Argentina, with robust supporting facilities in India. With common backend facilities in India, Your Company achieved a great feat by successfully starting the three CKD operations even with uncertainties related to the pandemic with an entirely digital coordination plan. In addition to this, a lot of checks and balances have to be introduced in the processes and IT systems to ensure accuracy and safety in handling and shipping of parts to multiple countries.

All-New Classic – Seamless transition to new J-Series platform

Royal Enfield has launched an All-New Classic - Reborn with a new heart - while retaining the key characteristics of the legendary motorcycle such as comfortable riding dynamics, timeless retro design, and ease of personalization. your Company carried out the transition to a new platform without causing disruption to the production (or sales), and this was achieved through strong collaboration between the manufacturing and product strategy teams. The Classic has set the new benchmarks for quality, performance and ride comfort in the industry. The motorcycle has been exceptionally well received in India as well as overseas markets, and won several best motorcycle awards.

Supply Chain Management: Navigating through waves

Supply chain partners of your Company waded through the waves of the pandemic and the sporadic impact it created across the globe with persistence. Many of the system & aggregate suppliers depend upon global tier-2 & 3 supply partners for their production and deliveries. With an integrated & focused approach and collaborative efforts, ‘your Company has been able to mitigate the impact and deliver steady volumes with the support of supply partners. Despite the continued global shortages of semiconductors, sharp increase in commodity prices, and few unexpected calamities in global industrial zones, your Company continued on the course of steady production improvement in the second half of the year. In order to improve availability of components, your Company undertook several initiatives such as onboarding alternate suppliers to de-risk, strategic build-up of inventories, advance booking of commodities and services etc. The impact of steep increases in input costs were minimised by actively pursuing value engineering and cost reduction initiatives. Your Company is committed to continue to develop its supply partners to be future ready with required technologies and processes to offer the best in class products & service as always, by concurrent development, early involvement and long term planning in all the areas of business to emerge stronger and better as we go forward.


Technology is one of the key pillars that support your Company to achieve its vision of becoming a global motorcycling brand. With its sights firmly on transforming into a technology-led business, your Company invests in technology for it to become the engine for all business activities. your Company’s digital strategy has three key drivers -

Enhance Customer experience

Royal Enfield’s focus is on enhancement of consumer interactions with the brand interfaces via multiple digital platforms. Our engagement with consumers is increasingly driven primarily via digital platforms, be it the interface(s) at the time of purchase, service requests, non motorcycle businesses or any other consumer related operations. your Company has put in place best in class IT infrastructure systems to drive global business activities.

Royal Enfield App

Our quest to improve overall digital consumer experience is backed by Royal Enfield App (RE App), which holistically integrates all major parts of the pure motorcycling experience. The launch of the RE App and a 3D con-gurator under the MiY initiative have opened up new dimensions for motorcycle personalization to suit varied preferences, and a seamless purchase experience integrating product selection, accessorization, maintenance plans, extended warranty options, and ease of delivery. Moreover, the App integrates effortlessly with Royal Enfield’s Tripper navigation pod for Google Maps based route mapping and provides access to the world of Do-it-Yourself content on Royal Enfield Motorcycles.

Enable Digital Enterprise your Company is making significant strides in digitizing the organisation’s internal processes and activities such as Plant automation, SAP, DMS, PLM, HR Automation and other initiatives. The core operations of ‘your Company are supported by robust, secure and global IT systems which facilitate a higher level of automation and free flow of information between multiple nodes. These systems back your companies key operations such as -

Coordination between CKD facilities and backend plant: Royal Enfield operates three CKD facilities located in Argentina, Colombia and Thailand. Your Company achieved a great feat by successfully starting the three CKD operations even with uncertainties related to the pandemic with an entirely digital coordination plan. In addition to this, a lot of checks and balances have to be introduced in the processes and IT systems to ensure accuracy and safety in handling and shipping of parts to multiple countries.

Auto replenishment for spare parts: During the year, Royal Enfield has fully implemented the auto replenishment model for all channel partners across the country. The system automated the spare parts replenishment at the retail outlet and resulted in an overall significant reduction in the channel inventory. Moreover, the availability of parts has improved to 98.4% including goods in transit.

Cloud based MSD: Across all 2,000+ stores in India, Royal Enfield has transitioned from a Dealer

Management System (DMS) to the cloud based Microsoft Dynamics (MSD). This has also been rolled out in international locations such as Thailand. The MSD is a useful tool in holistically monitoring customer requirements as well as activities on vehicles, and in managing the customer conversion funnel more effectively. A database of historical activity helps to enhance the delivery of superior service and elicit high levels of customer satisfaction.

Data Analytics, AI and Secure

A key pillar of Royal Enfield’s digital transformation is to leverage the huge datasets developed over years and to generate insights for data driven actions to help the solutions business. Moreover, ‘your Company is augmenting the power of Artificial Intelligence and Machine Learning across all segments to drive higher levels of automated and quick decisions. Mitigation and defense against potential cyber threats continues to be an important area for Royal Enfield, and during the year, ‘your Company has been successful in averting any potential cyber attacks.

In addition, Royal Enfield’s omni-channel apparel sales (Stores, website, e-tailers, other retailers), Robust consumer relationship management (CRM) programs, and Royal Enfield Mechanic App, which offers e-diagnosis and faster, smoother service delivery, are testament to ‘your Company’s digital capabilities.



The Human Resources function is committed to strengthening the ‘Being Eicher’ values and the Royal Enfield culture, and acts as a trusted partner to the business, thus developing capabilities at all levels. During the year, ‘your Company has continued to strengthen its people’s vision to create a unique Royal Enfield culture powered by a passion for the brand that enabled businesses, teams, and individuals to realize their true potential in an empowered, collaborative, innovative, and transparent work environment globally. your Company showcased strong resilience through the turbulence of the previous two years that was marked by multiple waves of COVID. We have carried forward the success of Operation ‘REStart’ to bring our operations back on track, working closely with local governments. your Company has always had a deep focus on the health and safety of its employees, and it was highlighted this year as well. COVID vaccination drives were conducted to provide vaccination to all the employees for which the cost was borne by ‘your Company. Employees were also supported with curated COVID insurance, doctor consultations and hospitalization assistance.

Despite the disruptions during the last year, Royal Enfield and its people have played a pioneering role in carrying forward the Company’s tradition of keeping consumer’s interest at the forefront. The commitment of our people was on display through the launch of multiple new products – All-New Classic, Scram 411, and multiple activities – 120th year anniversary, 90 degree South, EICMA, One ride 2021, Art of motorcycling, Continental GT Cup, Flat Track racing etc. your Company has built robust processes around staffng, talent management and capability enhancement by putting the right framework in place and imparting skills across varied roles. The key objective is to drive people towards contributing to the overall success of the organisation while continuously augmenting new skills. A slew of learning programs and interventions have been rolled out to ensure the growth and career progression of all the employees. During the year, ‘your Company restarted the feedback loop by kick-starting the Employee Engagement survey. ‘Listen, Learn and Act’ made a comeback after two years to gauge the pulse of the employees and create a positive workplace for all. your Company honours the dedication of its employees, as it looks back with pride at the effort and long-standing commitment of its workforce. your Company, in order to gear up for its long term commitments, has charted a broader and more robust organization structure. This new organization structure has substantially widened the management bandwidth with focus on Brand, Design, Product Development, Project Management, Commercial operations, Technical operations, Information Technology, Human resources and Finance. Moreover, the Company has been actively adding depth in each of these verticals by investing in the future by focusing on learning and development of young leaders working at Royal Enfield.


Eicher Motors Ltd. registered its highest ever annual revenue in FY22 at Rs 10,298 crores backed by success for Royal Enfield in the international markets - a growth of over 104% YoY in revenue - and marked improvement in non-motorcycling business - 45% YoY increase in sales. The year 2021-22 began with pandemic induced uncertainties in India and other countries and was followed by severe supply chain constraints. Overall volume of Royal Enfield declined by 2% to 5,95,474 motorcycles in 2021-22. Your Company’s revenue from operations increased by 18% to Rs. 10,298 crores in 2021-22 from Rs. 8,720 crores in 2020-21. Realisation improved on account of price hikes taken, primarily to offset the significant increase in input costs due to the surge in commodity prices, and on account of the improving share of international business as well as non motorcycle business.

Revenue from the India business increased 9% to Rs. 8,566 crores in 2021-22 from Rs. 7,873 crores in 2020-21. An excellent performance in export markets resulted in a 104% increase in revenue to Rs. 1,732 crores from international business. In a bid to grow its non-motorcycle segment share, your Company undertook a slew of initiatives across after-sales, accessories, apparel and solutions businesses. Improvement in parts availability, doorstep consumer services (Service-on-Wheels), Ride sure program, expansion of accessory and apparel range, and retail distribution are steps in the right direction to enhance customer experience. A great acceptance and rising penetration of all such initiatives has underpinned a healthy performance of the non-motorcycle business. Total revenue from spares and services, apparel, accessories and others increased by 45% YoY to Rs. 1,587 crores in 2021-22 despite the pandemic-led disruption to the demand.

Earnings before Interest, Tax, Depreciation and Amortisation ("EBITDA") of your Company increased by 22% to Rs. 2,172 crores in 2021-22 from Rs. 1,781 crores in 2020-21. EBITDA margin also increased to 21.1% in 2021-22 from 20.4% in 2020-21. Amidst sharp increase in commodity prices and elevated costs of operations, due to shortage of components and higher freight expenses, ‘your Company delivered improvement in the profitability. Successive pricing actions by your Company coupled with strong focus on cost reduction and value engineering helped offset the impact of higher costs.

Consolidated Net Profit After Tax ("PAT") increased by 25% to Rs. 1,677 crores in 2021-22 from Rs. 1,347 crores in 2020-21. An increase in Revenue, EBITDA, and higher contribution from ‘your Company’s JV with Volvo AB - Volvo Eicher Commercial Vehicles have uplifted the profit growth over last year.

Your Company’s financial position remains robust with total cash and cash equivalents, and investments (other than in subsidiaries and Joint Ventures) of Rs8,462 Crores. It generated a healthy cash flow from operations at Rs. 1,527 crores and also provided support to its supply partners and dealers. Your Company continued to invest in its product development activities and setting up operation facilities along with a special focus on growing its digital capabilities. The total capital investment for the year stood at Rs. 641 crores.

Key Financial Ratios

In accordance with SEBI (Listing and Disclosure Requirements 2018) (Amendment) Regulation, 2018, a company is required to give details of significant changes

(change of 25% or more as compared to the immediate previous financial year). Your Company has been reporting the following key financial ratios:

Particulars UOM Standalone Consolidated
2021-22 2020-21 2021-22 2020-21
Inventory Turnover Ratio Times 7.4 8.2 6.1 7.3
Current Ratio Times 1.9 3.6 1.9 3.4
Trade Payables Turnover Ratio Times 3.7 4.4 3.7 4.3
Net Capital Turnover Ratio Times 3.9 1.4 3.9 1.4
Operating Profit Margin % 16.5% 15.6% 16.7% 15.3%
Net Profit Margin % 15.7% 15.4% 16.3% 15.4%
Return on Equity % 15.4% 15.1% 13.8% 12.9%
Return on Capital Employed % 19.2% 18.0% 16.8% 15.1%
Earnings per share (basic) Rs. 58.0 48.7 61.3 49.3
Earnings per share (diluted) Rs. 58.0 48.6 61.3 49.2

Ratios where there has been a significant change from 2020-21 to 2021-22:

Current Ratio: Calculated as Current Assets / Current Liabilities. The current ratio for EML consolidated decreased from 3.4x in FY 2020-21 to 1.9x in FY 2021-22. The same ratio for EML standalone decreased from 3.6x in FY 2020-21 to 1.9x in FY 2021-22. This has been driven by liquidation of fixed deposits in the current year and their subsequent placement in the non-current investments.

Net Capital turnover ratio: Calculated as Net sales (= Total sales - sales return) / Working capital (= Current assets – Current liabilities). The Net capital turnover ratio for EML (both consolidated as well as standalone) increased from 1.4x in FY 2020-21 to 3.9x in FY 2021-22. This change has been on the account of higher sales in the current year and lower working capital as compared to the previous year.


Eicher Motors constantly monitors its operating environments continuously for potential risks that may impact its businesses. your Company has put in place a robust risk management framework for identification and mitigation of key risks. The process of risk identification, prioritisation and mitigation is overseen by the Risk Management Committee of the Board and the senior management personnel. your Company has adopted a host of strategic measures in response to risks identified. Some of the key risks are discussed below.

1. Uncertainty around COVID and its variants and economic slowdown Capital: Financial, Manufactured, Human, Social and Relationship Material Issue: Economic Performance, Manufacturing Efficiency, Occupational Health and Safety, Responsible Supply Chain, Customer Centricity, Community Engagement Economies worldwide are dealing with the uncertainties around COVID and its variants resulting in potential challenges on the supply chains as well as economic activity. As of the end FY-2021-22, while the COVID situation seems to be largely under control, normalcy in business activity and consumer expenditure are still lower than pre pandemic levels. your Company continues to take numerous initiatives not only to drive demand but also to enhance consumer experience. During the year, Royal Enfield launched All-New Classic – its most loved motorcycle, Scram 411 – a unique ADV crossover and new color variants for 650 Twins. While the uncertainty around the evolution of the pandemic continues to hover around multiple regions in the world, ‘your Company is working towards enhancing the safety of its consumers, employees, dealers and workmen. Moreover, focus on a strong product pipeline, distribution network enhancement, digital campaigns for brand building, digitization of booking/sales and initiatives to enhance customer experience are oriented towards growing the customer interest in the brand and its products. Your Company introduced multiple initiatives to support services at the customer doorstep and to enhance the ownership experience.

2. Commodity Pricing and Availability

Capital: Financial, Manufactured, Natural, Social and Relationship Material Issue: Economic Performance, Manufacturing Efficiency, Responsible Supply Chain, Customer Centricity, Responsible Use of Materials

The worldwide shortage of semiconductors and rise in the price of commodities such as precious metals, Aluminium, Crude oil, Steel, Copper etc not only resulted in supply chain disruptions and delayed production schedules but also led to an increase in the input cost of all motorcycles. your Company remained focused on ensuring availability of raw material and components to meet the consumer demand. Consequently, ‘your Company has undertaken multiple initiatives to improve supplies such as alternate vendor sourcing, advance inventory build-up, and optimizing variant-feature mix. In order to offset the increase in input costs ‘your Company has undertaken price increases, extensive cost reduction programs, and accelerated value engineering initiatives. As a result, ‘your Company has reported the profitability improvement, during the year, despite a surge in input costs.

3. Availability of Financing

Capital: Financial, Manufactured, Social and Relationship Material Issue: Economic Performance, Customer Centricity Amidst a sharp increase in ownership cost of motorcycles along with the muted market sentiment, availability of attractive financing options remains crucial for improving accessibility to consumers. In view of recent increase in interest rates and tightening liquidity conditions, ‘your Company is emphasizing on enhancing flexible financing options and collaborated with several leading financiers to roll out attractive financing schemes. During the year, Royal Enfield expanded the number of available financiers’ options at the dealerships. Additionally, a three-pronged approach was taken to improve access to consumers – 1. Low down payment requirements, 2. Extended loan tenures, and 3. Exploring low interest schemes. Moreover, your Company also launched the industry’s first digital finance marketplace (DFM), starting with 2 financiers on board. The Company has plans to expand the DFM model by increasing the number of financiers in the coming year.

4. Higher than expected tightening of

Environmental Regulations and Compliances Capital: Manufactured, Financial, Natural Material Issue: Regulatory Compliance, Climate Change, Energy and Emissions, Water Management, Waste Management, Responsible Use of Materials Royal Enfield is committed towards conservation of the environment, adapting sustainable practices and lowering its emission footprint. Your company now has operations in over 60 countries and is compliant with the regulations around energy consumption, e-uent treatment, waste management, governance and workforce management. However, unexpected change in local regulations around potential restriction of mobility options can hurt your company’s business in those regions. Your Company has put in place a strong compliance monitoring and risk management framework that monitors and proactively assesses the potential business risks in all the regions where we have our operations. For Example: Policy-led transition to EVs have picked up momentum in the last few years and multiple authorities have either incentivised or restricted consumer choices towards electric vehicles. Our major markets are no exception, with multiple countries (including India) incentivising the EV models, as of now. Royal Enfield believes that electrification of the premium motorcycle space is still in the nascent stages. Your Company has a long term, consumer-centric EV strategy in place to introduce product options. However, a faster than expected shift to EVs in premium segments, led possibly by local regulations and restrictions, or higher than expected fuel inflation could pose a key risk to our ICE portfolio.

5. Slower growth of middleweight segments and rise in competition Capital: Manufactured, Financial Material Issue: Customer Centricity, Economic Performance, Product Quality The mid-size motorcycles segment is ripe for substantial growth in coming years supported by a large base of entry level commuter motorcycles in emerging markets and substantial share of large size motorcycle users in developed motorcycles. Middleweight motorcycles, which are relatively easy to ride, maintain and offer pure motorcycling experience, have potential to outgrow the other two wheeler segments globally. However, a slowdown in the growth of middleweight motorcycles pose a risk to our long term business plans. Moreover, multiple new players have entered or have plans for entry in the middleweight segments to capture a share of this booming market. Many established brands which had thus far abstained from offerings in this space are also joining in, thereby increasing the available options for the consumers. Royal Enfield is well prepared to take on this challenge and has a long term, robust product pipeline to broaden its product portfolio to cater to a wider set of consumers across multiple geographies. Our product development capabilities are world class and the solid global performance of the Meteor 350, Himalayan, and the 650 Twins are a testament to the same. RE is committed to leading the global middleweight motorcycle segments through this -ourishing phase. In addition, ‘your Company operates an expansive premium distribution and manufacturing network catering to the customer bases in over 60 countries. Royal Enfield’s consumer reach via physical or digital means is unparalleled in the middleweight segments, so far, and is significantly ahead of its closest competitors.


During FY 2021-22, your Company assessed the effectiveness of Internal Control over Financial Reporting and found it to be adequate and effective. This has been further strengthened by creating a risk and control matrix for various critical processes through a special project named Internal Control – Centre of Excellence (IC-CoE). The IC-CoE is a centralized team of specialists who will provide ongoing support to colleagues while ensuring internal checks and controls over processes, with the aim of continuous improvement. Acting as the second line of defence to the management, this team will collaborate with project owners who will continue to have the primary responsibility of ensuring adherence. The team has prepared the risk control matrix and standard operating procedures covering Royal Enfield’s India and Thailand operations in the current year. In addition, a robust SAP based Enterprise Resource Planning (ERP) system ensures that your Company achieves a high degree of system-based checks and controls to protect its assets. In addition, the organisation’s governance risk and compliance frameworks ensure the effectiveness of internal controls and that they are complied with. An independent Internal Audit team keeps a vigil on the functions and processes in accordance with a schedule approved by the Audit committee. The adequacy and effectiveness of the internal financial controls with respect to financial reporting are reviewed by the statutory auditor. Your Company has a whistle blower policy / vigil mechanism that facilitates all employees, vendors, dealers and other stakeholders to report instances of fraud and wrongdoings, without fear of consequences such as victimisation and retaliation.


VE Commercial Vehicles Limited (VECV) is a joint venture between the Volvo Group and Eicher Motors Limited. In operation since July 2008, VECV is multi-brand, multi-division company comprising of a complete range of Eicher

Trucks and Buses, Volvo Buses, exclusive distribution of Volvo Trucks in India, engine manufacturing and exports for Volvo Group, non-automotive engines and Eicher component business. The Company made good progress across all segments backed by a frugal and innovative approach, despite supply chain challenges. The commercial vehicle industry has continued to improve steadily in FY2021-22 and should continue the growth path supported by pent up replacement demand and strong growth of infrastructure investments. With its strong product range as well as significant improvement in the distribution network, VECV will continue to strive to strengthen its position in the industry.

Key business initiatives and launches

In its efforts to be recognised as the industry leader driving modernization in commercial transportation in India and the developing world, VECV continues to introduce innovative and modern products as well as services. During the year, the Company launched My Eicher App - an industry-first digital platform, and expanded its range of fully connected commercial vehicles. The modern products not only enhanced the customer’s experience and fleet productivity, but also aided VECV’s solid resilient performance through the year.

Leading Digitization of commercial vehicle operations

VECV launched the My Eicher App - an industry-first digital platform - which integrates fleet owners, fleet managers, drivers, and VECV on the same platform in real-time. The App addresses the key aspects of transportation business such as - fleet management and uptime management, and also offers a set of value-added services. The customers can now stay in touch with VECV round the clock (24*7) for any assistance in their daily operations from any location, thus reducing the downtime. The App further compliments VECV’s 100% connected trucks and buses with advanced telematics solutions, and establishes VECV as a leader in modernization of commercial vehicles in India and Emerging Markets.

VECV bus segment: World class new buses from Eicher

VECV announced the formation of a Bus division housing Volvo Buses India operations and people in 2020 to create an Industry leader. During the year, VECV has launched two world-class Eicher Intercity Buses - a coach and a sleeper - for overnight journeys. The new buses feature the best of both brands - Eicher and Volvo. The new products incorporate Eicher’s expertise in value engineering and local know-how, and Volvo Buses India’s competence in the premium bus segment.

Volvo Heavy Duty Trucks

Volvo Trucks India, a division of VECV, has launched 6 heavy-duty trucks under the FM and FMX range in India in September 2021. Building on its track-record of delivering industry leading solutions, the new trucks are loaded with features to boost productivity, improve safety and enhance driver comfort. These trucks are designed for demanding applications such as Mining, Road Construction & Infrastructure projects, e-Commerce and Over Dimensional Cargo transportation. Moreover, these trucks feature Volvo Connect telematics solution, which enables customers to track the performance parameters of the truck in a user-friendly platform. All the services are well monitored and analysed to get the maximum uptime through 12 Volvo Uptime Centres spread across India.

Multiple awards and accolades

During the year, VECV has won numerous awards for its world class products and services, including multiple awards at the prestigious Apollo CV of the year -

Eicher Pro2114XP CNG Truck: Won CV of the Year and ICV Cargo carrier of the Year award

Eicher Skyline Pro Staff 3010 L CNG Bus: ICV people mover of the year

• Volvo 9400 B8R 13.5m 4x2 Coach: Coach of the year On the back of these initiatives and accolades, VECV has been able to gain the confidence of its customers and gain market-share. At the same time, multiple steps have been taken to offset the impact of commodity inflation and cash conservation, while not compromising on any of our long term initiatives.

Business and financial Review

VECV reported sales of 57,077 units in the financial year 2021-22 with a growth of 38.4% year on year on 41,253 units sold in the year 2020-21. VECV’s market share in key segments such as Light and Medium duty (LMD), and Heavy duty (HD) remained steady during the year at 30.2% and 6.6% respectively. In the bus segment, VECV (Including Volvo buses) gained market share to 21.6% in 2021-22 as compared to 19.9% in 2020-21.

Revenue for 2021-22 stood at Rs 12,724 crores marking a growth of 47% from Rs. 8,676 crores last year. EBITDA for the year 2021-22 was Rs. 716 crores, 21.2% higher than Rs. 590 crores last year. Amidst sharp increase in input costs as well as sustained discounting levels in the industry, VECV reported an EBITDA margin of 5.6% for 2021-22, 2.2% lower than 6.8% for last year. Profit after tax for the year increased by 93% year on year to Rs 111 crores, as compared to Rs 57 crores last year.

Eicher Trucks and Buses (ETB)

Eicher Trucks and Buses (ETB) has achieved sales of 55,877 (including 53 units of Volvo buses sold in FY 2021-22) units in the financial year 2021-22 as compared to 40,203 units in the financial year 2020-21, a growth of 38.9%. On the exports front, ETB has sold 8,426 units in the financial year 2021-22, as compared to 5,025 units in the financial year 2020-21, a growth of 68%. Light Medium Duty (LMD) trucks (5 - 15T) market share remained steady at 30.2% in the financial year 2021-22 from 30.6% in the previous year. Heavy Duty trucks market share for VECV (Eicher and Volvo) remained at 7.3% in the financial year 2021-22, slightly lower as compared to an all-time high of 7.9% in the previous year. In the bus segment, market share for VECV (Eicher and Volvo) improved from 19.9% to 21.6%.




Market Share

Eicher Industry
FY 2021-22 FY 2020-21 FY 2021-22 FY 2020-21 FY 2021-22 FY 2020-21 YoY % YoY %
Cargo (3.5-5Ton) 9,551 8,957 1,904 2,341 19.9% 26.1% -18.7% 6.6%
LMD (5-15Ton) 102,241 74,465 30,880 22,775 30.2% 30.6% 35.6% 37.3%
HD (16 Ton & above) 164,681 111,792 10,899 7,714 6.6% 6.9% 41.3% 47.3%
Buses 17,445 11,821 3,715 2,333 21.3% 19.7% 59.2% 47.6%
Total 293,918 207,035 47,398 35,163 16.1% 17.0% 34.8% 42.0%
Exports 49,443 27,408 8,426 5,025 17.0% 18.3% 67.7% 80.4%
Total 343,361 234,443 55,824 40,188 16.3% 17.1% 38.9% 46.5%
Volvo Trucks 1430 1208 1200 1065 83.9% 88.2% 12.7% 18.4%
Volvo Buses 53 15 253.3%
Total 343,361 234,443 57,077 41,253 16.6% 17.6% 38.4% 46.5%

Volvo Trucks India (VTI)

VTI managed a solid performance in the financial year 2021-22. VTI sold 1,200 trucks, which is 12.7% higher than financial year 2020-21. The Company maintained its strong brand image and leadership position in the premium trucks segment with 84% market share. During the year, VTI delivered the 100th Tipper to a single customer in road construction.

VE Powertrain (VEPT)

VEPT delivered 43,191 engines in the financial year 2021-22 as compared to 28,901 engines in the financial year 2020-21, thus registering a growth of 49%. With this, VEPT has delivered 2,37,456 engines since its inception to customers across the world. Despite multiple disruptions in the automotive industry around the world, VEPT ensured on-time supplies and zero delivery loss globally. A positive surge in demand foreseen for customers all around, including Europe and Asia and especially with the migration to BSVI in India, there has been an increase in supply of engines for Eicher branded vehicles.

Bus Business

The CV industry has started growing; however, the bus industry remained significantly muted as compared to pre COVID volumes due to muted mobility demand from schools, offices and travel segments during the year. The significant improvement in volumes have been seen during the year, as the mobility segments are steadily climbing towards normalcy. In 2021-22, VECV dispatches 3,768 buses (including 53 Volvo buses), 60% higher than 2,348 buses in 2020-21.

International Business

The Company recorded exports of 8,426 units of trucks and buses during the financial year 2021-22 as against 5,025 vehicles in the financial year 2020-21 reporting a growth of 68% year on year. Introduction of new products and variants, opening of new markets and segment-focused digital marketing helped shore up volumes despite drop in industry. Key markets such as Africa and Middle East delivered solid growth.

Cautionary Statement

Certain statements in the Management discussion and Analysis describing your Company’s views of the Industry, objectives and expectations etc, may be considered as forward looking statements within the meaning of applicable laws and regulations. Actual results may differ substantially or materially from those expressed or implied in the statement. Your Company’s operations may be affected by supply and demand situation, input prices and their availability, changes in Government regulations, tax laws and other factors such as Industrial relations and economic developments etc. Investors should bear the above in mind.