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The shares of Hero Motocorp Limited were trading lower by 1.8 per cent at Rs 2,707 levels in the early hours on Monday. In the past week, the shares have shed approximately 4 per cent. Over the last six months, the company has delivered a 15 per cent return to its investors. 

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The marginal drop can be attributed to the recent announcement made by the company about the price revision of the two-wheelers to meet the cost-push inflation. The revision will be up to Rs 1,000 and the exact quantum of increase will vary by model and market. 

This comes after the two-wheeler manufacturer announced that it is going to Foray into the electric vehicle segment next month with the launch of its first model with the Vida brand. It has also partnered with Hindustan Petroleum Corporation Limited (HPCL) to establish charging infrastructure for electric vehicles. 

Adding to the good news, the company has also announced that it is going to launch at least eight new models during the upcoming festive season. 

Brokerage firm Sharekhan is bullish on the stock and has given a ‘Buy’ tag with a target price of Rs 3,210 per share which represents an upside of 19% from the current levels. 

In Q1FY23, the company earned a total revenue of Rs 8,447 crores which has increased from Rs 5,502 crores in the same quarter a year earlier. Their net profit doubled to Rs 606 in the quarter under review as compared to RS 392 crores in Q1FY22. 

Hero MotoCorp Limited, formerly Hero Honda, is an Indian multinational motorcycle and scooter manufacturer. It is the world’s largest manufacturer of 2 Wheelers, in terms of unit volumes sold by a single company. 

The company is undervalued as the TTM PE is 20.37 compared to the sectoral PE of 25.66. The market capitalization of Hero Motocorp is at Rs 54,005 crores and its dividend yield stood at 3.51% as of September 26th. 

Written by Anoushka Roy


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