Hero Moto Corp –
Q1 FY 25 concall and results highlights –
Revenues – 10211 vs 8851 cr
EBITDA – 1460 vs 1117 cr, up 21 pc ( margins @ 14 vs 13 pc )
PAT – 1032 vs 701 cr
Company has crossed 500 Hero 2.0 stores ( these are upgraded versions of their existing stores. Company has decided to upgrade a fixed no of its erstwhile stores to 2.0 standards ). These are upgraded stores giving a better customer experience
Have also crossed 40 Premia stores – should take them to 100 stores before end of FY 25. Premia stores have been opened to sell premium vehicles like – Harley X440, Karizma XMR, X Pulse 200 and Vida EVs
The margins in the ICE portfolio were @ 16.4 pc. Because of the impact of investments in the EV portfolio, consolidated margins are @ 14.4 pc
Seeing good uptick in rural demand. Rural is one area where the company has traditionally been very strong and has a robust sales and service network
Company continues to spend aggressively in R&D. R&D spends over last 5 yrs have been around 3500 cr. Working on – EVs, Hybrids, flex fuel powertrains
Company has dramatically improved its Mkt share in the 125 cc category in Q1 vs Q4 LY ( from 13 pc to 20 pc mkt share – that’s a huge jump ). All the brands in this category – Super Splendour, Xtreme 125R, Glamour – have done well
Because of great customer response received by Xtreme 125R, company is increasing its production capacity from 25k bikes / month to 40k bikes / month
After the launch of Harley X 440 and Maverick in last FY, company intends to launch a few more products to boost its presence in the premium segment. Some products like – fully refreshed ( new body ) Dstini scooter, Xoom scooter are steps in that direction. Also intend to launch more EVs after the launch of Vida range of EVs LY
Company’s shareholding in Ather Electric currently stands @ 39 pc
As the EV volumes keep increasing, their negative impact on EBITDA margins ( company level ) will keep reducing ( as they will also turn EBITDA positive if the company is able to sell more EV scooters )
Post covid, the rural markets were hit harder vs urban mkts. Also, the 100-125 cc 2W mkt was hit harder than the > 150 cc mkt. As the lower end / rural part of the mkt is recovering now – this augurs well for HeroMoto Corp
At present, 60 pc of company’s sales are happening via NBFC/Bank financing. Company has launched Hero Digi Finance – an aggregation platform for financing which is all automatic ie based on customers digital footprint. This has the potential to make financing more affordable and accessible
Company shares its smart charging Infra with Ather. At present they have around 2500 charging stations in collaboration with Ather
Vida EV crossed 5000 scooters volume / month in the month of July. As the volume ramp up keeps happening, there is a clear path to profitability in the EV business
Another key focus area for the company continues to be the export markets. Progress is export markets has been steady – but still below Company’s internal targetsCompany is seeing a dramatic improvement in customer satisfaction levels from upgraded / more premium Hero 2.0 stores
Along with these, company has also upgraded 190 of their service centers with upgraded consumer lounges
Capex guidance for this FY @ 1200 cr. R&D guidance @ 800 cr
Disc: not holding, studying, not SEBI registered
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