Hero MotoCorp smashes sales record: Over 14 lakh units sold in the festive season; stock rallies over 2.5%

Hero MotoCorp, the world’s largest manufacturer of motorcycles and scooters, recorded its highest-ever festive sales this year.

As per the details mentioned in the press release the company clocked more than 14 lakh (1.4 million) units in retail sales during the 32-day festive period between the first day of Navratri and Bhai Dooj this year. Riding on robust demand across rural markets as well as steady retail uptake in key urban centres, the company registered a 19% growth over the previous year and surpassed its previous highest retail sales of 12.7 lakh units, which were recorded during the festive period of 2019.

Following this news, the company’s share price rallied over 2.5% during the intraday session, and as of the current writing of the article, they are trading at Rs 3,258 per share on the BSE. Observing the historical return of the stock, it has generated a 21% return over the last six months, outperforming the S&P BSE Sensex, which has generated a return of 6.78% during the same period.

Regarding the achievement, Niranjan Gupta, Chief Executive Officer (CEO) of Hero MotoCorp, stated, “We are delighted with the festive sales and extend a big thank you to all our customers who have continued to place their trust and faith in Brand Hero. Our strong portfolio of brands, extensive distribution network, and new launches this year have contributed to driving this growth across different regions. The festive season clearly indicates that rural areas are experiencing growth again, which bodes well for the country in general and the two-wheeler industry in particular.”

Spreading joy during the festive season, Hero MotoCorp launched the second edition of Hero GIFT – the Grand Indian Festival of Trust. This program, tailored for the festive period, includes new model updates, captivating colour variations, enticing benefits, and appealing finance schemes designed for customers.

Furthermore, the company’s net profit surged by 48% YoY from Rs 682 crore to Rs 1,007 crore during the September quarter. This marks the net profit margins at 10.5% for the quarter. The company reported revenue of Rs 9,533 crore compared to Rs 9,158 crore, representing a moderate 4% YoY growth. The operating profit stood at Rs 1,360 crore, up from Rs 1062 crore, with the operating profit margin at 14% compared to 12% in the same quarter last year.

Once known as ‘Hero Honda,’ Hero Moto Corp stands as one of India’s pioneering motorcycle manufacturers. Its journey began in 1984 through a technological collaboration with Honda, Japan. Prior to this collaboration, Hero was primarily engaged in selling Cycles under the brand name, Hero Cycles.

In 2011, the Honda group divested its 26% stake in the company to the Munjals (the promoters) and consequently concluded the joint venture. Following the termination of this joint venture, the company’s name was altered to Hero Motocorp.

Investors must keep this stock on their radar.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.