Hero MotoCorp sold 390,000 vehicles in the first quarter of the financial year 2022-23 (April-June). Compared to the same quarter last year (FY22), the company sold 1,025,000 units, a strong double-digit growth rate of 35.7%.
That’s 17% higher than the last quarter of the 2021-22 fiscal year (January to March) and the company sold 1,189,000 units.
Sales growth suggests that consumer confidence continues to improve and the company expects this positive trend to continue in the coming months, helped by moderate monsoon winds and increased agricultural activity. Sales of motorcycles and scooters reached 485,000 units in June 2022, up 3.3% from 469,000 units in the same period last year.
Hero MotoCorp announced a significant increase in net profit. Worth seeing?
Two-wheeler giant Hero MotoCorp reported a 498% YoY net profit growth to Rs 3.7 billion in the June quarter, beating market expectations.
The company, Korea’s largest two-wheeler maker, said its operating profit exceeded expectations, posting an operating profit of Rs 54.9 billion, up 85% from a year ago.
The company’s strong year-on-year growth in net profit and revenue was supported by a weak base compared to the same period last year, which was affected by the country’s lockdown to stop the Covid-19 epidemic from spreading.
At an operating level, the company’s Earning increased 377% YoY to Rs 5.2 billion. The operating profit margin in the fourth quarter was 9.4%.
On 6 May 2021, the Board of Directors proposed an interim dividend of 70 rupees per share, which was approved by the shareholders, with a final dividend of Rs 35 per share (par value of Rs 2 per share) for the year ended 31 March. . . , 2021. General Meeting of Shareholders
Lockdown impact on the company’s sales
The company’s operating and financial results were affected in part by the production shutdowns announced by various state governments during the quarter.
The New Delhi-based motorcycle manufacturer sold 1,024,000 units from April to June, down 35% from the previous quarter.
This is because regional closures have led to production paralysis and market closures in most countries.
In addition, a second outbreak hit the region where sales of two-wheelers are expected to increase due to the good rainy season, good harvests, and high government spending. was devastated by the second wave of the pandemic.
High operating costs due to high fuel costs, a series of price hikes before the pandemic, and the resulting increase in raw material costs weighed on sales again.
Niranjan Gupta, the chief financial officer of Hero MotoCorp, said raw material costs continue to rise, hurting industry profits.
He said the company was optimistic about demand in the coming months as the festive season kicked off with a favorable rainy season boosting agricultural activity.
Hero MotoCorp electric scooter set for global debut
Two-wheeler maker Hero MotoCorp has launched its first electric scooter (EV) and plans to launch an electric product line starting in 2022.
On August 10, 2021, the company shared a preview of its upcoming electric scooter in a live broadcast to celebrate the company’s 10th anniversary.
Although electric scooters represent only a small part of total two-wheeler sales in the country, the situation is changing rapidly and the arrival of Hero will accelerate the expansion of electric vehicles in the two-wheeler market.
Pawan Munjal, President of Hero Moto Corp, said at the company’s 10th-anniversary celebration:
The next decade is the decade of electrification and we are working hard to develop our EV product at a different level. We conducted extensive testing of electric two-wheelers in Jaipur and Munich.
He said the company is developing a variety of products, including products with battery exchange technology from Taiwanese partner Gogoro.
A brief overview of the company’s EV industry competitors
Hero MotoCorp, which owns 35% of electric vehicle startup Ather Energy, plans to launch its first electric vehicle by the end of the financial year2022.
At the same time that SoftBank-backed Ola is launching its first e-scooter on August 15, 2021, Hero MotoCorp is announcing its first electric vehicle.
Ola claims to have built the world’s largest electric motorcycle factory in Tamil Nadu to dominate the domestic and international markets.
Also, Hero’s long-time competitors like Bajaj Auto, and TVS Motor have launched products in the electric vehicle arena.
Bajaj Auto is India’s second-largest motorcycle manufacturer, behind TVS Motors in terms of market share.