Hero MotoCorp Ltd. share price target

Revenue increased by 17.09% to Rs. 8564.04 Cr in Q4FY18 when compared to the previous quarter. Hero MotoCorp Ltd Q4FY18 results Comment

Hero MotoCorp (HMCL) reported 4QFY17 results, were above our and in line with consensus estimates. Result was better than our estimates on account of lower RM cost and better realization. Revenue grew +24% YoY to Rs85.6 bn which were above our and in-line with consensus estimates. Revenue growth after adjusting accrued incentives pertaining to CGST were 26% YoY to Rs87.4 bn. Spare part revenue for the quarter grew +10% YoY/ +7% QoQ to Rs7.7bn. RM cost for the year gone up which was off-set by the operating leverage and other cost initiatives taken by the company. Leap benefits for the FY18 was ~50-60 bps. EBITDA for the quarter...

Q4FY18 revenue grew by 23.7%YoY to Rs85.6bn on the back of robust volume growth of 23.4%YoY aided by improving rural sentiments on hopes of an abundant monsoon. EBIDA margin expanded 217bpsYoY despite a rise in raw material price. The expansion was aided by tight cost control as it is evident from the 99.5bps fall in other expenses. HMCL expects the EBITDA margin to be in range of 14-15% on the back of robust volume growth, price hikes but increase raw material price will be watchful. We expect revenue CAGR of 11% over FY17-20E led by new product launches, capacity expansion and increase in rural income due to higher crop productivity owing to favourable monsoon....

We have tweaked earnings by 1.7% for FY20E, Maintain BUY with revised TP of Rs 4,403(19x FY20E EPS). Hero Motocorps (HMCL) 4QFY18 numbers were broadly in line estimates. Net revenue stood at Rs 85.6bn (+24% YoY), on the back of 23% YoY rise in volumes (2mn units). EBITDA (Rs 13.7bn, +43% YoY/18% QoQ), with margin at 16 %(+216 bps YoY/15 bps QoQ) was supported by control and oplev benefits. Gross margin contracted by 27bps QoQ on account of higher RM prices and lower spare parts contribution. APAT stood at Rs. 9.67bn (+35% YoY/20% QoQ).

the Company's operating leverage and its cost saving programme would help negate the competitive pressure on margins. It took price hike of around Rs300 per vehicle in 4QFY18 as well as at the beginning of FY19 to compensate for cost escalation. Management guided for a...

which were tad below expectations on higher than expected other expenses (11.9% v/s 11.3% qoq) on Auto Expo costs and higher marketing and advertising expenses. Depreciation came in 10% higher yoy as Halol plant in Gujarat is ramping up. Tax rate came in at 30.3%, as Haridwar...

Impressive Performance Maintain BUY; During Q4FY18, Hero MotoCorp Ltd (HMCL) sales grew by 23.7% YoY to Rs85.6bn,driven by 23.4% volume growth and a 0.2% increase in average realizations.

Revenue rose 23.7% YoY toINR85.6b (in -line) in 4QFY18. Realizations were flat YoY/QoQ at INR42.8k (in-line) due to price hikes. While the gross margin was in line at 32.4%, higher other expenses (due to higher marketing spends) led to a miss on the EBITDA margin (16% v/s estimate of 16.7%). PAT grew 35% YoY to INR9.7b(est. of INR9.8), led by higher other income. For FY18, revenue grew 13.1%to INR322b (with volume growth of 13.9% and realization decline of 0.7%), EBITDA margin was flat at 16.4% and PAT increased 9.5% to INR36.9b. HMCL announced a dividend of I NR95/share for FY18 (v/s INR85 for FY17)

that are in-line with our estimates. Revenues grew 24% y-o-y to Rs 8,564 cr on the back of a strong 23% volume growth led by strong traction in the rural demand and low base of the corresponding quarter last year. Realisation/ vehicle remained was flat on a y-o-y basis. EBIDTA margins improved 220 bps y-o-y to 16% (in-line with our estimate of 16%) on a low margin...

Hero MotoCorp Limited is a two-wheeler manufacturer. The Company manufactures and sells motorized two wheelers up to 350 cubic centimeters (cc) engine capacity, spare parts and related services. Its manufacturing plants are located in Dharuhera, Haryana; Gurgaon, Haryana; Haridwar, Uttarakhand; Neemrana, Rajasthan, and Villa Rica, Colombia. Its research and development center is located in Jaipur, Rajasthan. It has a Global Parts Centre for manufacturing and supplying the parts at local and global markets at Neemrana, Rajasthan....