Accumulate Hero Motocorp; target of Rs 4736: Prabhudas Lilladher

Accumulate

Prabhudas Lilladher's research report on Hero Motocorp

HMCL's Q3FY25 standalone revenue increased by 5% YoY, in-line with consensus while it was 2.2% higher than PLe. The growth in revenue was mainly driven by 4.7% YoY expansion in its realizations as volumes remained flat. Gross profit increased by 10% YoY while margin expanded by 156bps YoY to 34.2% (PLe: 32.9%), as a result of stable commodity cost, spare revenue and cost savings. Consequently, EBITDA increased by 8.4% YoY with a margin expansion of 45bps YoY to 14.5% (PLe: 14.1%; BBGe:14.2%). Healthy overall performance coupled with strong expansion in the other income led its PAT to increase by 12.1% YoY, coming in 3.5%/10% higher than BBGe/PLe.

Outlook

Additionally, the management expects recent government measures towards providing taxation relief will further aid in consumption across categories. Factoring this, we retain our “ACCUMULATE” rating with a TP of Rs4,736 (previous Rs4,662), valuing its core business at 16.5x on its Dec’26 EPS its stake in NBFC & Ather at Rs222.

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Hero Motocorp - 11022025 - prabhu