Royal Enfield, iconic motorcycle brand of Eicher Motors, has signed a Memorandum of Understanding (MoU) with the government of Tamil Nadu pledging Rs. 1,500 crore investment in the state.
The MoU foresees aggregate investment of Rs. 1,500 crores in Tamil Nadu for a period of 5 years beginning from May 2016. The investment would be made for capacity expansion at Royal Enfield’s three existing manufacturing facilities at Thiruvottiyur, Oragadam and at Vallam Vadagal which are in and around Chennai. These facilities are capable of producing motorcycles for India and international markets.
The company also plans to set up a technology centre at Old Mahabalipuram Road (OMR) in Chennai. Of the total investment of Rs. 1,500 crore, it has already spent Rs. 1,000 crore.
In May 2012, Eicher had signed a similar MoU with the state government to set up a new manufacturing plant at Oragadum by investing Rs. 350 crores within the period from 2011 to 2016. The company was successful in completing the committed investments before the investment period.
On Thursday, the stock of Eicher Motors closed at Rs. 20,100.95 and opened flat on Friday. It surged by 1.2 per cent to make intra-day high of Rs. 20,334.40. In September 2018, the stock was trading at Rs. 29,667 levels and since then has dipped by ~32 per cent.