Eicher Motors Hits Record High on Royal Enfield Growth Boost

Shares of Eicher Motors surged nearly 7% to a record high after the company announced plans to expand production capacity, strengthening growth prospects for its Royal Enfield motorcycle business. The stock climbed to ₹7,756, marking its best single-day gain since January 2025, following strong investor optimism around sustained domestic demand.

The company approved an investment of ₹9.58 billion to increase capacity at its Tamil Nadu plant, lifting total annual production capacity from 1.46 million units to 2 million units. Analysts believe this expansion positions Royal Enfield to benefit from India’s recent tax cuts on motorcycles, which are expected to accelerate premium bike demand.

Brokerages including UBS and Jefferies noted that Royal Enfield stands to gain from premiumisation trends, adding that competitive and margin pressures appear to have eased. After the company posted better-than-expected quarterly profits driven by robust domestic sales, at least 12 brokerages raised their target price on the stock, pushing the median estimate to ₹7,500.

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