Eicher Motors Stock Surpasses ₹5,000 Mark for the First Time, Up 32% in 6 Months

Eicher Motors, a part of the Nifty 50 index, has reached a new milestone as its shares crossed the ₹5,000 mark for the first time today, hitting an all-time high of ₹5,058.90, up by 3.2%.

Since February, Eicher Motors shares have been on a steady rise, growing by 32%, which is more than the entire CY23 return of 28.4% in just six months.

Royal Enfield Launches New Model

On July 17, Royal Enfield, the two-wheeler division of Eicher Motors, launched a new premium modern roadster called the Royal Enfield Guerrilla 450. This model is known as the Royal Enfield GRR 450 in most Latin American markets and features a 452cc single-cylinder liquid-cooled Sherpa engine.

The Guerrilla 450 is based on the existing 450 Sherpa platform, also used in the Himalayan 450 launched in November 2023. It is priced similarly to the Triumph and Harley 400cc models.

Performance and Competition

The Guerrilla 450’s power output is similar to the Triumph Speed 400 and higher than the Harley X440. It competes with other premium models like the RE Classic 350, RE Meteor 350, RE Himalayan 450, Honda H’ness CB350, Jawa Perak 335, Harley X440, and Bajaj Triumph 400.

Over the last five years, Royal Enfield has launched several models to expand its lineup. However, the segment has struggled to increase its market share. Royal Enfield’s market share in the premium bike market has decreased to 88.3% in FY24 from 96.3% in FY19.

The main challenge to Royal Enfield’s dominance has come from competitors like Hero MotoCorp and Bajaj Auto, who have entered the premium category and received positive responses to their models. These competitors have averaged a monthly volume of about 11,194 units over the past 12 months, which has expanded the market size of the >250cc segment but also reduced Royal Enfield’s market share.

Should You Buy Eicher Motors Stock?

According to a note by domestic brokerage firm Elara Capital, Royal Enfield’s retail market share has remained largely unchanged at 4.2% in FY25 YTD, compared to 4.4% in FY23 and 4% in FY19.

Elara Capital attributes this stagnation to several factors:

1. High prices in the mid-size motorcycle segment are limiting demand.
2. New model launches by Royal Enfield are mostly cannibalizing each other.
3. The expected trend of Royal Enfield owners replacing their bikes with new models has not materialized.

While no single competitor has significantly impacted Royal Enfield, the combined competition, garnering around 10,000 units per month, has limited Royal Enfield’s potential for growth.

Elara Capital does not expect these factors to change significantly. They believe these launches are necessary to maintain Royal Enfield’s current market share rather than increasing it.

Therefore, Elara Capital has reiterated its ‘Sell’ rating on Eicher Motors stock with a price target of ₹4,306 per share, based on 24x June 2026E P/E for the Royal Enfield business and 11x June 2026E EV/EBITDA for VECV.