Hero MotoCorp rides on robust Q2 performance and better prospects

Markets give thumbs up to the two-wheeler major's performance, analysts bullish on stock

Lower raw material costs and better rural demand boosted Hero MotoCorp’s (HMCL) Q2FY24 performance. There was a 4.7 per cent quarter-on-quarter (Q-o-Q) increase in volumes and 7.7 per cent rise in revenue to Rs 9,445 crore. The earnings before interest and tax, depreciation and amortization (Ebitda) increased by 10.1 per cent Q-o-Q to Rs 1,328 crore. 

The Ebitda margin expanded by 30 basis points (bps) Q-o-Q to 14.1 per cent and gross margin also expanded by around 80bps expansion.

The EV (electric vehicle) business dragged the Ebitda margin down by 90 bps because scale benefits have not yet kicked in.