Popular Indian two-wheeler maker Hero MotoCorp has announced that some models’ ex-showroom prices would go up from July 1, 2024. A filing with the Bombay Stock Exchange (BSE) states that the price increase might go as high as ₹1,500, albeit it would differ depending on the model and market. In order to somewhat offset increased input prices, the firm stated that this modification was required.
After the news, Hero MotoCorp’s shares rose sharply, 0.52% to ₹5,480, the highest it had been all day. Nevertheless, the 3,678 shares traded were below normal when compared to the two-week average of 29,000. The turnover was 2 crore rupees, alongside a market capitalization of 1,09,553.25 crore. Specifically, there were 52,442 sell orders compared to 9,557 buy orders.
Despite recent reports of a price raise, Hero MotoCorp’s stock was trading lower than its 5-day and 10-day SMAs but higher than its 20-day, 30-day, 50-day, 100-day, 150-day, and 200-day SMAs. The stock was neither overbought nor oversold according to the relative strength index (RSI) that it had over the past 14 days, which was 55.15. Stock in the firm is trading at a P/B ratio of 6.06 and a P/E ratio of 27.47. With 198.48 EPS, it has a return on equity of 22.06.
Along with the price hike, Hero MotoCorp revealed a sizable investment in Ather Energy, an electric scooter producer. A 2.2% share in Ather was acquired by the firm for ₹124 crore, bringing its total ownership to above 40%. Hero MotoCorp owned most of Ather’s shares before this investment.
Hero MotoCorp was owned by promoters to the tune of 34.76% as of March 2024. Some motorcycle and scooter models had their prices raised by 2% in March 2023 to meet the new emission standards. Recent price increases, which averaged 1.5%, should address ongoing concerns with input costs and business needs, according to expectations.
With 519,474 units sold, Hero MotoCorp’s overall sales for May 2023 were up 6.7% year over year. The firm expects demand to keep climbing as the holiday season approaches, which it ascribed to the beginning of the monsoon season and good economic indicators.
But Hero MotoCorp isn’t the only Indian agency keeping tabs on the company. Concerned about possible financial diversion, the ministry has asked for an inquiry into the business’s transactions with an outside vendor. Regardless, Hero MotoCorp stated that it has not received any formal communication on the investigation from the government.
Finally, in response to rising input costs and strict regulations, Hero MotoCorp is prudently increasing pricing and investing in electric mobility. In order to maintain its market position and encourage development despite the ever-changing economic conditions, the firm has adopted aggressive measures.
