As Hero Honda reported a 1.6% fall in its net profit for the first quarter of the fiscal, it may sound a minor fall to many but was unusual for a company like Hero Honda. The company has been constantly raising the bar in the Indian two-wheeler market for the past few years but has recently hit a roadblock as far as the profitability is concerned.
The company however, posted a rise in its sales for the quarter but as the rising raw material costs took its own toll from the company.
Managing director and chief executive officer Hero Honda Motors, Pawan Munjal, said that facts like the moving up on the emission norms and component supply crunch has been major problems for the company in the last quarter as far as its bottom-line is concerned.
It is believed that the coming quarters will provide some relief to the company as the commodity prices are expected to settle down. Hero Honda's chief financial officer Ravi Sud, said that the margins are expected to be better in the coming quarters and the royalty payment to the parent remains the same.