Remarkably, the stock has finished eight of the last nine months in positive territory, and November stood out with the highest monthly gain of 23.66%. Throughout the year, the stock rose ₹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 increased by 3.43%, reaching a new 52-week high of ₹4,079 per share. Notably, the stock is only 0.60% away from surpassing its all-time high ₹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 each. The brokerage highlights the recovery in Hero MotoCorp’s core product portfolio and its strategic expansion into premium and electric vehicles (EV), positioning it favorably in the 2W OEM space.
Despite the usual post-festival slowdown, domestic 2W demand continued strong growth this year, offset in part by strong demand during the wedding season, particularly in the central and northern regions, the brokerage noted.
Also Read: 27 Nifty 50 stocks registered new all-time highs this year; will the rally continue in 2024?
This positive trend goes 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 continued growth momentum is expected to drive expansion in HMCL’s core 100CC and 110CC portfolio, which constitutes 80% of its total 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, behind competitors such as Yamaha and TVS. However, it said that the company has several products planned in the 200-400cc category, ready to improve competition in the higher end of the segment.
Also Read: Bajaj Auto, Eicher Motors among 8 Nifty Auto stocks that touched new highs this year; check full list
“Hero MotoCorp aims to expand to 100 cities by the end of December 2023 (against three cities in March 2023). To stand out in the competitive EV industry, the company is also expanding its network and focusing on setting up expertise 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 , starting 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 use both VIDA and Ather Grids. The combined network should cover 100 cities, providing access to more than 1,900 fast charging points.
Also Read: Hero MotoCorp to buy an additional 3% stake in Ather Energy up to ₹140 crores
In November, the company achieved significant sales, with a total of 4.9 lakh motorcycles and scooters sold. This marked a remarkable increase of 26% compared to the same month in the previous fiscal year, during which the company sold 390,932 units.
Disclaimer: The opinions 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 making any investment decisions.
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Published: 26 Dec 2023, 16:28 IST