Hero MotoCorp and Bajaj Auto, two of India’s leading automobile manufacturers, recently announced their Q2FY25 results. Both companies have showcased notable revenue growth, but their profit margins and market strategies reveal contrasting trajectories. This comparison explores their financial performance, sales patterns, and future outlook, providing a comprehensive view of how these industry leaders stack up against each other.
Hero MotoCorp announced its Q2 results for FY24 on November 14, 2024. The company’s net profit rose by 5.7% year-on-year (YoY) to ₹1,063.71 crore, while its revenue increased by 9.96% YoY to ₹10,482.93 crore. Compared to the previous quarter, revenue grew by 2.67%, and profit increased by 1.7%. However, operating costs, including selling, general, and administrative expenses, rose significantly by 7.17% quarter-on-quarter (QoQ) and 13.39% YoY.
Pune-based Bajaj Auto reported a 31.4% decline in consolidated net profit (PAT) to ₹1,385.44 crore in Q2FY25. However, revenue from operations rose by 22.2% year-on-year (YoY) to ₹13,247.28 crore, driven by strong vehicle and spare parts sales and recovering exports. The drop in profit was mainly due to a one-time expense of ₹211 crore for Deferred Tax on Investment Income caused by changes in the Finance Act 2024. Sequentially, revenue increased by 11%, but PAT fell by 28.65%. EBITDA reached an all-time high of ₹2,653 crore, up 24% YoY.
Hero MotoCorp, the world’s largest two-wheeler manufacturer, is optimistic about outpacing industry growth. Strong festive season sales, rural demand, and upcoming launches have driven the company’s optimism. The company achieved record festive retail sales of 16 lakh units, supported by robust monsoons and positive economic fundamentals.
Its VIDA brand is gaining market share in the electric segment, with plans for a broader lineup. Hero also improved its S&P DJSI score to 69, ranking first among Indian two-wheeler makers and fourth globally in the automotive sector.
On the other hand, Bajaj Auto reported a 20% YoY increase in total vehicle sales for September 2024, reaching 4,69,531 units. Domestic sales surged 23% to 3,11,887 units, while exports rose 13% to 1,57,644 units.
Two-wheeler sales grew 22% to 4,00,489 units, with domestic sales jumping 28% to 2,59,333 units and exports increasing 13% to 1,41,156 units. Commercial vehicle sales saw a 6% rise, totalling 69,042 units for the month.
Hero MotoCorp’s entry into the electric vehicle (EV) space through its Hero Vida brand reflects its commitment to innovation, though details of its performance in this segment remain limited.
Bajaj Auto’s electric scooter, Chetak, achieved remarkable success, with quarterly sales reaching 70,000 units and market share growing to 20%, a significant jump from 6% in March.
Hero MotoCorp remains focused on expanding its EV portfolio and retaining its leadership position in the domestic two-wheeler segment.
Bajaj Auto has announced an additional $10 million investment in its Brazilian subsidiary to strengthen its operations in Latin America, highlighting its commitment to global expansion.
About Hero MotoCorp
Hero MotoCorp, previously known as “Hero Honda,” is one of India’s earliest motorcycle manufacturers. The company began in 1984 through a technological partnership with Honda, Japan. Before this, the Hero group was known for selling bicycles under the brand “Hero Cycles.” In 2011, Honda sold its 26% stake in the joint venture to the Munjal family, the promoters of Hero. Following the end of the partnership, the company rebranded itself as Hero MotoCorp.
On November 19, 2024, Hero MotoCorp share price opened at ₹4,759.95, touching the day’s high of ₹4,853.95 as of 12:07 PM on NSE.
About Bajaj Auto
Bajaj Auto, the leading company of the Bajaj Group, is a manufacturer of two-wheelers and three-wheelers. It exports to 79 countries, including regions like Latin America and Southeast Asia. The company is headquartered in Pune, India. Bajaj Auto owns a 48% stake in the KTM brand, which produces sports and super sports motorcycles. This stake has grown from 14% in 2007 when Bajaj first invested in KTM.
On November 19, 2024, Bajaj Auto share price opened at ₹9,560.00, touching the day’s high of ₹9,698.60 as of 12:30 PM on NSE.
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.
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