Rs 4,300 next? Eicher Motors shares drop 7% on growth focus Eicher’s lower ASP driven by poor product mix, says Emkay Global
Eicher Motors Shares Drop 7%: A Closer Look
Eicher Motors has recently experienced a significant drop of 7% in its stock price, now hovering around Rs 4,300. This decline comes on the heels of the company’s renewed focus on growth, but not without some bumps along the road. So, what led to this unexpected downturn?
Lower than Expected Average Selling Price (ASP)
According to Emkay Global, the primary culprit behind this decline is the company’s lower-than-expected average selling price (ASP). This was primarily driven by a suboptimal product mix, notably influenced by the higher share of the Bullet Battalion Black edition in their offerings. While this model has its enthusiasts, it seems to have affected the overall pricing structure negatively.
Product Mix Challenges
The product mix is crucial in the automotive industry, and Eicher Motors appears to have faced challenges in this area. A heavy reliance on certain models, especially those with a lower ASP, can dilute the company’s revenue potential. Investors are now keenly watching how Eicher Motors plans to diversify its product mix to better capture market demand and stabilize its stock prices.
Future Outlook and Strategies
Looking ahead, it will be interesting to see how Eicher Motors adapts its strategies to regain market confidence. A renewed focus on premium models and innovation could be on the horizon to enhance their ASP and overall market position.
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