Hero MotoCorp to ride high on volumes and low valuation, say analysts

Company's margins could expand on operating leverage and price hikes, say analysts

The stock of the country’s largest two-wheeler maker, Hero MotoCorp, gained over 4 per cent on expectations that strong demand trends, price hikes and operating leverage benefits will lift the company’s performance going ahead. This, coupled with undemanding valuations, added to the gains. As a result, the Hero MotoCorp was the second highest gainer on the Nifty 50 on Thursday, closing the day at Rs 2,509 apiece.

Aided by strong rural sentiment (higher crop prices, robust cashflows and normal monsoon expectations) and ongoing marriage season sales, two-wheeler retail offtake is expected to be strong in the near term. On a