Following a management interaction, the brokerage said Hero MotoCorp expects the domestic two-wheeler industry to grow between 7%-8%, with the company aiming to outperform overall industry growth.
JPMorgan noted that the ongoing shift in consumer preference towards scooters and electric vehicles remains a structural challenge for Hero MotoCorp, given its strong presence in the motorcycle segment. However, the company expects to offset this headwind through disproportionate growth in its scooter and EV businesses during FY27.
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The brokerage said Hero MotoCorp was able to partially mitigate the impact of this market shift in FY26 through gains in the scooter and electric vehicle segments, even as the broader migration away from motorcycles continued.
Exports remain another key growth driver, as the management said export momentum is expected to sustain after recording a 42% CAGR between FY24 and FY26.
On profitability, JPMorgan expects margins to remain under pressure in the near term. Nevertheless, gradual price increases and benefits from the Production Linked Incentive (PLI) scheme for electric vehicles are expected to support margin improvement over time.
The brokerage said that despite the stock trading at an attractive valuation of around 13 times FY28 estimated earnings, investor concerns continue to center on Hero MotoCorp’s market-share losses.
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43 analysts have coverage on Hero MotoCorp, of which 29 of them have a “Buy” recommendation, while nine recommend “Hold” and five have a “Sell” rating. The stock hass a consensus price target of ₹5,948.83, implying a potential upside of about 23% from current levels.
Hero MotoCorp shares were trading 1.35% higher on Friday at ₹4,902.10. The stock has gained about 12% over the last 12 months.
