Hero MotoCorp confident of gaining market share this year; to set up new unit in Brazil

New Delhi: Hero MotoCorp on Wednesday said the financial year 2023-24 has been a remarkable period for the company. This was driven by its focus on “product launches, network upgrade and customer satisfaction”.

The two wheeler maker, which has seen its share in the market dip in the last few years, is confident of driving market share gains in the current financial year 2024-25 “on the back of our launches in the premium and 125 cc segment done in FY24”.

During the year, Hero MotoCorp introduced six new products in the premium and 125cc segment– Xtreme 125R, Xtreme 200S, Xtreme 160R 4V, Harley-Davidson X440, Karizma XMR and the Mavrick 440.

In terms of sales volumes, the company remains a leader in the two wheeler segment, however it has seen its share in the market slid from 37% in FY 2020-21 to 30% in the year ended March 2024. Industry experts suggest this comes on the back of new entrants in the EV market, changing preferences of the consumers towards premium products, and comparatively slow moving mass market motorcycle products.

Going forward, the company is quite optimistic about the growth of the overall two wheeler industry. “We expect macro‐economic factors to aid the industry’s growth. With commodity prices remaining stable, expectations of normal monsoons, and government spending expected to increase, we see multiple tailwinds for the sector over the upcoming quarters,” Niranjan Gupta, CEO, Hero MotoCorp said.

To give a boost to its scooter portfolio, the company is looking to launch Xoom 125 cc and Xoom 160 cc in the coming months. “The coming year will see us taking big strides in EV through product launches in the mid and affordable segment. Overall, we see a very positive outlook for the coming years.”

Currently, the company sells only one electric scooter-- Vida, which was launched in October 2022. Currently, Ola Electric , TVS Motor, Bajaj Auto and Ather Energy dominate the electric scooter market in India.

Driven by sales of its mid-range motorcycles, the two wheeler maker has reported a 17% growth in its consolidated profit after tax (PAT) at INR 943.46 crore in January-March 2024 quarter. The company reported a consolidated PAT of INR 810.8 crore during the corresponding period of last year.

Consolidated revenue from operations during the Q4 FY24 stood at INR 9,616.68 crore when compared to INR 8,434.28 crore in Q4 last year.

Hero MotoCorp has declared a final dividend of INR 40 per share. “This dividend together with interim and special dividend, marking the centennial year of Chairman Emeritus Dr Brijmohan Lall Munjal, of INR100 per equity share, takes the aggregate total dividend for the year 2023-24 to INR 140 per equity share i.e. 7000%,” it said.

The company will also set up a new wholly owned subsidiary in Brazil, which will most likely be named ‘Hero MotoCorp do Brasil Ltd'. This will be Hero's first manufacturing unit outside India. It will invest in the new entity in phases, and cater to the manufacturing and distribution of two-wheelers including parts and accessories.

In July last year, Bajaj Auto said it will set up its first overseas manufacturing plant in Brazil through its wholly-owned subsidiary Bajaj Do Brasil.

Pune-based Bajaj has presence in more than 90 countries, where it follows a distribution-led model, the company's distribution partners manage local operations, including assembly.