Hero MotoCorp Limited, the world’s leading two-wheeler manufacturer, is optimistic and expects to outpace industry growth in the coming quarters. Fueled by fresh launches, rising demand, and a festive season boost, the company anticipates robust momentum ahead.
"The recently concluded festive season saw us clocking our highest ever retails at 16 lakhs units,
backed by higher demand from the rural sector. We believe the strong monsoon will help the
momentum in the industry as we advance. The fundamentals look good for the Indian economy in general and 2 wheeler industry in particular," Niranjan Gupta, Chief Executive Officer of the company said in a post-Q2 result conference call on November 15.
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Hero MotoCorp said it is set to introduce three new models over the next six months—the Xpulse 210, Xtreme 250R, and Karizma XMR 250. The company also aims to expand its high-end retail network, targeting over 100 Premia stores by the fiscal year-end.
With plans for increased brand-building investments, Hero’s growth strategy includes a strong push in the scooter segment, both in ICE and EV. Three ICE scooter models are expected by March 2025, promising various first-in-class and best-in-class features. Meanwhile, Hero’s electric brand, VIDA, is seeing gains in market share, with an expanded lineup covering all price points on the horizon.
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Hero MotoCorp said it has achieved improvement in its S&P Dow Jones Sustainability Index (DJSI) score, climbing from 51 to 69. The company now holds the top rank in the DJSI score among India’s two-wheeler manufacturers and ranks fourth globally in the automotive industry.
During the quarter, the company saw a 14 percent year-on-year (YoY) increase in its standalone net profit at Rs 1,204 crore due to a sharp rise in volumes. The standalone results do not include the business of its subsidiaries or associates, including IPO-bound Ather Energy and Hero FinCorp.
The company's standalone revenue from operations rose 11 percent to Rs 10,483 crore for the September quarter as compared to Rs 9,533 crore in the year-ago period.
Hero's earnings before interest, taxes, depreciation and amortisation margin grew to 14.5 percent during the quarter from 14.1 percent a year earlier.
The results surpassed analysts’ expectations. According to a Moneycontrol poll of eight brokerage firms, the two-wheeler manufacturer’s net profit was projected to rise 9 percent to Rs 1,147 crore, up from Rs 1,054 crore in the same quarter of the previous fiscal year. The company’s revenue was projected to rise by 8 percent to Rs 10,223 crore, as per the brokerage’s estimates.
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Sales volumes of Hero grew 7 percent, led by a 16 percent rise in sales of its more expensive mid-range motorcycles such as "Xtreme 125R". That took their contribution to the company's overall sales volumes to 12.6 percent from 11.6 percent a year earlier.
The entry-level motorcycles such as "Splendor" formed three-fourths of the total volumes.
Hero MotoCorp shares ended higher by nearly 2 percent at Rs 4,604. Given the recent market selloff, Hero MotoCorp shares have come under fire and have tanked 17 percent in the past month.
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