Remarkably, the stock concluded eight out of the last nine months in positive territory, and November stood out with the highest monthly gain of 23.66%. For the year as a whole, the shares surged from ₹2,738 to ₹4,070, reflecting a remarkable gain of 48.64%. This represents the stock’s most impressive annual performance since CY14.
Also Read: 2023 in review: Over 40 Nifty50 stocks rose between 10% and 90%; Tata Motors, NTPC top gainers
During today’s session, the stock surged by 3.43%, reaching a new 52-week high of ₹4,079 per share. Notably, the stock is just 0.60% away from surpassing its all-time high of ₹4,091 per share.
In a recent note, domestic brokerage firm Motilal Oswal maintained its ‘buy’ rating on the stock with a target price of ₹4,480 apiece. The brokerage highlights the recovery in Hero MotoCorp’s core product portfolio and its strategic expansion into premium and electric vehicles (EVs), positioning it favorably in the 2W OEM space.
Despite the usual post-festival slowdown, domestic 2W demand has sustained strong growth this year, fueled in part by strong demand during the marriage season, particularly in the central and northern regions, the brokerage noted.
Also Read: 27 Nifty 50 stocks recorded new all-time highs this year; will the rally continue in 2024?
This positive trend aligns well with Hero MotoCorp’s stronghold in key states like UP (54% market share), Rajasthan (58%), MP (42%), and Bihar (45%). According to the brokerage, these states collectively contribute 35% of the domestic 2W demand.
The ongoing growth momentum is expected to drive expansion in HMCL’s core 100CC and110CC portfolio, which constitutes 80% of its overall volumes, as highlighted by the brokerage.
The brokerage also noted that Hero MotoCorp’s market share in the >125CC category has remained below 4% since FY17, trailing competitors like Yamaha and TVS. However, it said that the company has multiple products planned in the 200-400cc category, poised to enhance competition in the higher end of the segment.
“Hero MotoCorp aims to expand to 100 cities by the end of December 2023 (vs. three cities in March 2023). In order to stand out in the competitive EV industry, the company is also expanding its network and focusing on establishing experience centers such as VIDA Corner, Hub, and Pods, as well as opening new exclusive Vida dealerships. HMCL is currently in the ‘Transform’ phase and will move to the ‘Disrut’ phase from FY25 onwards. During this phase, it will launch new products at various price points, beginning with more affordable options,” the brokerage added.
Recent developments
On December 6, the company announced a partnership with Ather Energy, one of India’s leading electric vehicle manufacturers, to establish an interoperable fast-charging network across the country. This collaboration aims to enable electric vehicle (EV) users to seamlessly utilise both VIDA and Ather Grids. The combined network is set to cover 100 cities, providing access to over 1,900 fast-charging points.
Also Read: Hero MotoCorp to buy additional 3% stake in Ather Energy for up to ₹140 crore
In November, the company achieved significant sales, with a total of 4.9 lakh motorcycles and scooters sold. This marked a notable 26% growth compared to the same month in the previous fiscal year, during which, the company sold 390,932 units.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
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Published: 26 Dec 2023, 04:28 PM IST