About -
Hero MotoCorp Ltd, formerly Hero Honda, is an Indian multinational motorcycle and scooter manufacturer headquartered in New Delhi. The company is one of the largest two-wheeler manufacturers in the world. It has 8 mfg. units, 6 in India & 1 each in Columbia & Bangladesh
Hero MotoCorp Ltd, formerly Hero Honda, is an Indian multinational motorcycle and scooter manufacturer headquartered in New Delhi. The company is one of the largest two-wheeler manufacturers in the world. It has 8 mfg. units, 6 in India & 1 each in Columbia & Bangladesh
The company offers motorcycles in all the 3 major
segments— HF Deluxe, HF 100 in entry, Splendor, Passion & Glamour in executive, Xtreme & Xpulse in premium. It also sells Maestro
Edge, Destini & Pleasure in the un‐geared scooters segment.
segments— HF Deluxe, HF 100 in entry, Splendor, Passion & Glamour in executive, Xtreme & Xpulse in premium. It also sells Maestro
Edge, Destini & Pleasure in the un‐geared scooters segment.
Revenue breakup -
HMCL earns 89.3% of it's revenue form Tow Wheelers & 10.7% spare parts.
HMCL earns 89.3% of it's revenue form Tow Wheelers & 10.7% spare parts.
Financial Summary -
Q4 FY22 (YoY)
Revenue ⬇️ 14.6%
EBITDA ⬇️ 32%
PAT ⬇️ 28%
Q4 FY22 (YoY)
Revenue ⬇️ 14.6%
EBITDA ⬇️ 32%
PAT ⬇️ 28%
Global Presence -
HMCL has been earning 96.2% from India and 3.8% from Rest of the world.
It targets to ramp up export contribution
to 15% of total sales in the next 4 years.
HMCL has been earning 96.2% from India and 3.8% from Rest of the world.
It targets to ramp up export contribution
to 15% of total sales in the next 4 years.
Key Triggers -
• Reduction in excise duty on fuel by Government to benefit automobile players.
• Waiving off import duty on raw materials to cool down domestic steel prices.
•The forecast of a normal monsoon is likely to aid the
corps, improving cash flows in rural sector.
• Reduction in excise duty on fuel by Government to benefit automobile players.
• Waiving off import duty on raw materials to cool down domestic steel prices.
•The forecast of a normal monsoon is likely to aid the
corps, improving cash flows in rural sector.
• They have also launched “Vida” brand which is a new identity for Hero
Motocorp’s emerging mobility solutions including upcoming Electric vehicles (EV).
Motocorp’s emerging mobility solutions including upcoming Electric vehicles (EV).
• HMC announced investment of Rs 420cr in electric two-wheeler maker, Ather Energy. This
additional investment in Ather is a part of their three-pronged EV strategy. The company has also partnered with Taiwan's Gogoro on
battery swapping & EV scooters.
additional investment in Ather is a part of their three-pronged EV strategy. The company has also partnered with Taiwan's Gogoro on
battery swapping & EV scooters.
Risks -
• Inability to create strong brand in scooters & premium motorcycles remains the biggest risk.
• Decline in market share due to shift of preference by customers towards scooters & premium motorcycles & Electric bikes where
HMC is a late entrant.
• Inability to create strong brand in scooters & premium motorcycles remains the biggest risk.
• Decline in market share due to shift of preference by customers towards scooters & premium motorcycles & Electric bikes where
HMC is a late entrant.
• Lower than expected volume growth in export markets.
• If rural economy turnaround due to better monsoons does not lead to sustainable advantage for HMC.
• If rural economy turnaround due to better monsoons does not lead to sustainable advantage for HMC.
Conclusion -
We expect HMC to gradually recover its lost market share in motorcycles over the next 2-3yrs led by gradual economic recovery
driving consumption from the mid-to-low income consumers & revival in rural economy.
We expect HMC to gradually recover its lost market share in motorcycles over the next 2-3yrs led by gradual economic recovery
driving consumption from the mid-to-low income consumers & revival in rural economy.
Market share revival in domestic motorcycles & ramp-up in exports are likely to be the key
upside triggers for the stock.
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upside triggers for the stock.
Please 🙏 like 👍, comment & retweet ♻️ if you find this useful.
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