Hero MotoCorp rose 1.18% to Rs 2,243.80 at 13:19 IST on BSE after the company said it launched its operations in Bangladesh through a joint venture with Nitol Niloy Group.
The company made the announcement during trading hours today, 21 April 2014.
Meanwhile, the BSE Sensex was up 58.70 points, or 0.26%, to 22,687.54.
On BSE, so far 8,308 shares were traded in the counter, compared with an average volume of 16,470 shares in the past one quarter.
The stock hit a high of Rs 2,247.60 and a low of Rs 2,211.90 so far during the day. The stock hit a record high of Rs 2,320 on 7 April 2014. The stock hit a 52-week low of Rs 1,451.15 on 18 April 2013.
The stock had outperformed the market over the past one month till 17 April 2014, rising 4.35% compared with the Sensex's 3.76% rise. The scrip had, however, underperformed the market in past one quarter, rising 6.87% as against Sensex's 7.43% rise.
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The large-cap company has an equity capital of Rs 39.94 crore. Face value per share is Rs 2.
Hero MotoCorp said this is its first overseas joint venture (JV) to set up a two-wheeler manufacturing plant outside of India, since it commenced its solo journey almost three years ago.
Hero said it will hold 55% stake in the new JV while the Nitol Niloy Group will hold the rest 45% stake. There will be a total equity injection of $12.6 million in the ratio of 55:45 over a period of two years. The new venture will have a capital expenditure (capex) of $23.2 million in the first year of its operation (financial year ending 2015) and a total investment of $40 million over the next five years.
While the manufacturing plant will be operational by the second quarter of the fiscal year ending March 2016, the Hero range of two-wheelers are already being made available in Bangladesh through the initial 50 retail outlets.
Mr. Pawan Munjal, Managing Director & Chief Executive Officer, Hero MotoCorp said: "The commencement of our operations in Bangladesh is a significant milestone in our strategic global expansion plans. In addition to being our first overseas joint venture, this is also where our first manufacturing plant outside of India will come up. Once operational by the second quarter of Financial Year 2015-16, the plant will have an annual capacity of 150,000 units. We are aiming to have around 20% of market share here in the first year of our operation. With the setting up of the state-of-the-art world class plant here, we will bring the latest modern technology into the country. This will generate direct & indirect employment and opportunities in the country. I am delighted to have the Nitol Niloy Group come on board as our partner in this market. Jam sure with their rich experience in this market we will be able to provide convenient, fuel-efficient mobility to every customer."
Mr Munjal inaugurated the first of the flagship Hero showrooms in Dhaka. More outlets are also being rapidly added in markets across the country, the company said in a statement.
Hero MotoCorp's total sales increased 11.9% to 5.24 lakh units in March 2014 over March 2013. Sales grew 3% to 62.45 lakh units in the fiscal ended 31 March 2014 over the fiscal ended 31 March 2013. The company said it was the highest ever despatch sales in any financial year.
Hero MotoCorp's net profit rose 7.5% to Rs 524.66 crore on 11.3% growth in net sales to Rs 6845.91 crore in Q3 December 2013 over Q3 December 2012.
Hero MotoCorp is the world's largest two-wheeler manufacturer in terms of production capacity.
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