Hero MotoCorp best performing auto stock, up 10% so far in August

The stock hit a new high of Rs 4,044, up 2% on BSE in intra-day, extending its past two weeks gain.

Hero MotoCorp (HMC) hit a new high of Rs 4,044, up 2% on BSE in intra-day trade, extending its past two weeks gain, after the company reported a strong 17% growth in total two-wheeler sales of 623,269 units in July. The world’s largest two-wheeler manufacture had sold 532,113 units in the corresponding month of the previous fiscal (July 2016).

Hero MotoCorp is the best performing stock among automobiles, up 10% thus far in the month of August. On comparison, the S&P BSE Sensex and S&P BSE Auto index were down 2.7% and 2.3%, respectively. Eicher Motors and Bajaj Auto up 2%, while TVS Motor gained marginally by 0.1% during the period.

Despite sluggish sales for the first few days of the month due the transition to Goods & Service Tax (GST), Hero MotoCorp recorded six-lakh plus sales for the month of July. This is the third consecutive month of six-lakh plus sales for the company in this fiscal, having clocked 624,185 units in June and 633,884 units in May.

The company said it is confident of carrying forward this growth momentum into the upcoming festive season.

Analysts at HDFC Securities believe HMCL is the best pick, with a likely revival in the rural economy (especially in UP, the largest market for two-wheelers, with a share of 14%), as around 50% of sales are in rural markets. Launch of six new models (including 125 CC scooters) in FY18E will provide much-needed support to volume growth.

A sharp rally in Hero MotoCorp stock, the market capitalization (m-cap) of the company crossed Rs 80,000 crore. With the m-cap of Rs 80,172 crore, Hero MotoCorp, is less than 4% away from Eicher Motors and Bajaj Auto, which having m-cap of Rs 83,283 crore and Rs 82,471 crore, respectively, the BSE data shows.

Company	31/07/2017	LTP	% chg
Hero Motocorp	3654.10	4026.00	10.2
Atul Auto	430.65	439.60	2.1
Eicher Motors	30040.60	30593.80	1.8
Bajaj Auto	2807.60	2853.25	1.6
TVS Motor Co.	582.15	582.60	0.1
Maruti Suzuki	7707.95	7680.00	-0.4
M & M	1402.00	1373.90	-2.0
Escorts	668.70	638.10	-4.6
Force Motors	4032.05	3815.00	-5.4
Ashok Leyland	109.65	103.65	-5.5
VST Till. Tract.	2222.05	1992.80	-10.3
Tata Motors	444.50	382.30	-14.0
SML ISUZU	1127.70	952.00	-15.6
S&P BSE Sensex	32514.94	31653.06	-2.7
S&P BSE Auto	24463.15	23892.98	-2.3
LTP : Last traded price on BSE in Rs at 01:23 pm