During Q1FY18, Hero MotoCorp’s (HMCL) performance was on expected lines. Revenue growth was 7.7% YoY to Rs79.7bn (PLe: Rs79.2bn), while EBITDA grew 5.4% YoY to Rs12.96bn (in line with expectations); EBITDA margin was at 16.3%, lower 30bps YoY, but up 240bps QoQ (PLe: 16.1%). Gross margins were lower 60bps YoY (up 80bps QoQ) to ~32%. Staff costs to sales ratio was higher 30bps YoY, while OE / sales ratio was lower 30bps YoY. With slightly higher tax rate, net profit for the company grew 3.5% YoY to Rs9.14bn (PLe: Rs9.2bn).