Eicher Motors shares rose 5% to Rs 2,714.15 on the BSE in intraday trade on Monday after the company’s Royal Enfield brand recorded a 43% increase in month-on-month sales of 73,739 units in December 2021.

In recent months, the business has posted its best-ever reading. Year on year, Royal Enfield sales increased by 7% to 68,995 units in December 2020.

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The company’s commercial vehicle segment sales increased by 25.8% to 6,154 units during December 2021 from 4,892 units sold in December 2020. Its total domestic sales were up 27.6% at 5,192 units versus 4,069 units.

ICICI Securities stated in a report that the primary highlight for the month was Royal Enfield’s good volume printing, which should alleviate growth concerns at Eicher Motors.

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At 09:27 a.m., the stock was up 3.4% on the BSE, trading at Rs 2,678.75, compared to a 0.51% advance in the S&P BSE Sensex. On January 22, 2021, the stock reached a 52-week high of Rs 3,035.50. The BSE Auto index rose 1% supported by Eicher Motors, Tata Motors and Tube Investments.

Eicher Motors has outpaced the market in the last month, rising 11% vs Sensex’s rise of 2.6%. However, it has gained 1% in the last six months, compared to a 12% gain in the benchmark index.

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In November, when the company announced its September quarter (Q2FY22) results, the management stated that it expected a quick volume rebound, owing to improved chip supply and a robust order book. The management emphasized the need for new products and network expansion.

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The management indicated that once the semiconductor scarcity is relieved, the output would begin to recover. While domestic demand remains down, Royal Enfield is gaining traction through exports, which are likely to exceed 60,000 units for the first time in FY22E, according to an analyst at HDFC Securities.