The 57 reports from 17 analysts offering long term price targets
for Hero MotoCorp Ltd. have an average target of 3152.38. The consensus estimate
represents a downside of -2.49%
from the last price of 3232.90.
Our interaction with Hero MotoCorp's (HMCL) management indicated that the structural growth traction in the two-wheeler (2W) industry remains intact. HMCL continues to benefit from premiumisation of its products, its stronghold in the economy and executive motorcycle segments, and aggressive products offerings in premium bike and scooters segments. HMCL is a market leader in the Indian 2W industry, commanding a ~38.5% share. The company commands ~65% market share in the combined economy and executive motorcycle segment, which together makes up 80% of the motorcycle market size in India. HMCL has strong penetration in semi-urban and rural areas, aided by its largest distribution network...
Domestic auto industry volumes have been on a steady mend in the months post lifting of lockdown restrictions. Manufacturing and distribution activities have been getting ramped up gradually since June 2020, in step with the rest of the economy. However, the impact of the pandemic on the supply chain continues to inhibit a complete return to production normalcy. Nevertheless, most automotive industry segments have reported successive improvement in offtake throughout June-November 2020 (Exhibit 1) on the back of (i) initial bounce provided by pent-up aspect,...
Current tax expense jumped 18.7% year-on-year to Rs 255.27 crore in Q2 September 2020. Volumes grew 7.7% to 18.22 lakh units sold in Q2 FY21 over Q2 FY20. EBITDA jumped 16.80% to Rs 1286 crore in Q2 September 2020 as against Rs 1101 crore in Q2 September 2019....
Hero records highest ever sales, PAT soars Hero MotoCorp (HMCL) is India's leading two-wheeler manufacturer in terms of unit volume sales in a calendar year. It holds nearly 50% of the market share in the Indian motorcycle market. The company has eight...
Personal mobility and rural sentiments continue to support demand Hero MotoCorp (Hero) reported lower-than-expected 2QFY21 adjusted net profit of Rs9.5bn, up 2% YoY, driven by better operating performance. Reported EBITDA margin declined by 80bps YoY to 13.7% largely due to BS-VI cost impact and higher employee costs to bring back the migrant labors. Cash flow generated in 2QFY21 stood at over Rs30bn on efficient working capital management. As per the management, festive season started well for Hero across segments and regions. During the first 10 days of festivals, retail sales were 96% of last year's level. For Hero, Navratri-Dusherra period forms 1/3rd of festive demand, which peaks in Dhanteras-Diwali period. Rural demand continues to remain positive while urban and semi-urban markets have started to catch up. In October'20,...
HMCL is in a sweet spot as strong rural-led recovery plays to its strength in the EconomyExecutive category in the Motorcycles segment. We maintain our BUY rating and TP of Rs. 3,450 and continue to value the stock at 16x its FY23E EPS.
Hero MotoCorp (HMCL) reported a strong set of Q2FY21 numbers. Total 2W sales volume for the quarter came in at 18.2 lakh units, up 7.7% YoY. Consequent net sales were at | 9,367 crore, up 23.7% YoY. Blended ASPs were at | 51,412/unit, a rise of ~15% YoY (courtesy BS-VI transition). EBITDA margins at 13.7% were down 80 bps YoY. The margin performance was impacted by a rise in raw material cost but employee and other expenses declined on a percentage of sales basis by 70 bps and 190 bps, respectively. Consequent PAT came in at | 953.5 crore (up 9% YoY). Lower...
Hero Q2FY2021 results were in line with street expectations. Net sales and EBIDTA grew 24% and 17% y-o-y respectively. Hero is witnessing improvement in demand with retail sales reaching 96% of last year level in initial part of the festive season. Company expects further improvement in festives and has ramped up production. We expect strong recovery from FY22 driven by normalisation of economic activities. Operating leverage, price hikes, and cost saving under the leap programme would result in margin improvement. We expect Hero to reach its historical margin range of 15%-16%....
Hero MotoCorp (HMCL) 2QFY21 numbers were broadly in line estimates. EBITDA increased by 17% YoY to Rs.12.8bn with margin at 13.7% (-81bps YoY). Increase in RM prices was offset by cost control measures and better operating leverage. The management sounded positive on domestic sales outlook with demand back to pre Covid level, expecting momentum to continue into the festive season. Festive sales have started off well for the company and retail sales reached 96% of last year during the Navratri period...
Hero Motocorp Ltd (HMCL) is the market leader in the 2W industry with a market share of ~39% (as of Aug 2021). Hero is present in both the motorcycles and the scooter segments, having market share of about ~53% and ~10%, respectively.
Seminal year for industry provides interesting insights However, amid all the gloom, the engineering and production prowess of the industry (along with its value chain) shone brightly as it successfully completed the world's fastest switchover to Euro 6 equivalent emission norms i.e. BS-VI as per schedule. Much of the post festive period was focused on the transition, with the entire ecosystem estimated to have spent ~| 70,000 crore towards the technological leap. Covid-19 crisis struck India in the run up to April 2020, just as the changeover...
It has the best positioned portfolio, with HF Deluxe in the Economy segment, Splendor in Executive 100cc, and Super Splendor / Glamour in Executive 125cc, covering all the price points with multiple variants. With an apt product portfolio for the rural market, the highest brand value, and a strong distribution network, Hero is best placed to benefit from low penetration and ongoing momentum in the rural economy. HMCLs market share in Executive 100cc was at ~87% in FY20 (v/s 84% in FY19), and with the launch of the new Passion, it has gained further market share to 90% in FY21YTD. HMCLs market share declined by 700bp to ~51% in FY20 in the 125cc segment post the launch of the Bajaj Pulsar 125. However, post the launch of the new Super Splendor and Glamour, it regained market share by 225bps FY21YTD.
We continue to prefer Hero MotoCorp Ltd on the back of robust rural & semi urban demand, downtrading trend and preference for entry level motorcycles (Hero being the market leader), along with a shift in preference for Personal mobility.
We are initiating coverage on Hero Motocorp Ltd (Hero) with a BUY rating and a Target Price of Rs 3,450, which implies ~10% upside from the current levels.
Retail sales have been consistently improving on m-o-m basis. Early August trends also indicate improvement over July levels. Inventory is lower than normalised levels and Hero is ramping up...
Hero MotoCorp reports 92% drop in Q1 PAT, misses estimates On a consolidated basis, the two-wheeler maker's net profit tumbled 95.3% to Rs 59.14 crore on a 63.7% decline in net sales to Rs 2,969.08 crore in Q1 FY21 over Q1 FY20. EBITDA fell 90.7% to Rs 108 crore in Q1 June 2020 from Rs 1,158 crore in Q1 June 2019. EBITDA margin was at 3.6% as on 30 June 2020 as compared to 14.4% as on 30 June 2019. Profit before tax in the June quarter stood at Rs 79.49 crore, down by 95.8% from Rs 1873.83...
Hero MotoCorp (HMCL) is India's leading two-wheeler manufacturer in terms of unit volume sales in a calendar year. It holds nearly 50% of the market share in the Indian motorcycle market. The company has eight...
Hero MotoCorp (Hero) reported better-than-expected 1QFY21 net profit of Rs613mn, down 88% YoY, driven by better operating performance and lower tax expense. Reported EBITDA margin declined by 1080bps YoY to 3.6%. Lockdown period cost was Rs2.5bn. Adjusting for this, EBITDA margin was ~12%. Cash flow generated during 1QFY21 stood at over Rs10bn. As per the management, shift away from public transport and shared mobility towards personal mobility, strong recovery in rural and semi-urban markets and very good feedback on BS-VI products will be the key drivers of demand going forward. Leading indicators like eway bills and GST collections have reached ~85% of pre-covid level. Fertilizers & Tractor sales and kharif sowing data indicate strong rural recovery. Demand recovery, which started in June, hasn't seen a decline in July or August, which indicates that it is not just pent-up demand. Demand from bigger cities is still well...
