HEROMOTOCONSEAugust 12, 2025

Hero MotoCorp Limited

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Management on call

Kasbekar will start with your opening commentary. Vikram Kasbekar

Thank you, Umang. Namaskar, and welcome, everyone, to the Hero MotoCorp's Earnings Call

Key numbers — 40 extracted

30.9%

e pleased to report a positive start to the fiscal year with our Vahan market share recovering to 30.9% in quarter 1 FY '26, representing a sequential increase of 1%. The economic landscape appears not

Vahan market share recovering to 30.9% in quarter 1 FY '26, representing a sequential increase of 1%. The economic landscape appears notably optimistic as we approach our festive season, commencin

800 bps

malized. In the entry segment, HF Deluxe spearheaded the category expansion for industry, gaining 800 bps market share year- on-year, taking our market share to 11-quarter high. We also strengthened our H

rs 125

variant. Both are designed to offer compelling value and enhance our competitive edge. In Scooters 125cc, we reached our highest market share in June at 9.7%, led by new Destini 125 and Xoom 125. Pr

9.7%

d enhance our competitive edge. In Scooters 125cc, we reached our highest market share in June at 9.7%, led by new Destini 125 and Xoom 125. Premia channel scale-up is progressing well, and we reach

40%

hannel scale-up is progressing well, and we reached 90 stores by Q1 FY '26 and covering more than 40% of the premium industry's footprint. Global business continued to gain market share, driven by ga

of our focus markets. In EV, we reported our highest ever market share, quarterly market share of 7%, more than doubling year-on-year. Our July market share further increased to over 10%. To further

10%

ket share of 7%, more than doubling year-on-year. Our July market share further increased to over 10%. To further accelerate our growth in the EV business, in July we launched the VIDA VX2 pioneering

₹9,579 crore

mance for Hero MotoCorp for the first quarter of FY'26. The company recorded quarterly revenue of ₹9,579 crores, EBITDA of ₹1,382 crores and PAT of ₹1,126 crores. The EBITDA margin during the quarter for ICE

₹1,382 crore

or the first quarter of FY'26. The company recorded quarterly revenue of ₹9,579 crores, EBITDA of ₹1,382 crores and PAT of ₹1,126 crores. The EBITDA margin during the quarter for ICE business improved to 16.8

₹1,126 crore

26. The company recorded quarterly revenue of ₹9,579 crores, EBITDA of ₹1,382 crores and PAT of ₹1,126 crores. The EBITDA margin during the quarter for ICE business improved to 16.8%, driven by mix improvem

16.8%

rores and PAT of ₹1,126 crores. The EBITDA margin during the quarter for ICE business improved to 16.8%, driven by mix improvement, price and LEAP savings, while we continue to invest behind brand bu

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Guidance — 20 items

Vikram Kasbekar

opening

“Riding on this positive optimism, we expect two-wheeler demand to continue its upward trajectory as we enter the upcoming festive season.”

Vivek Anand

opening

“I am pleased to report financial performance for Hero MotoCorp for the first quarter of FY'26.”

Vivek Anand

opening

“With our product launches, and as we amplify our brand building initiatives, we expect to grow our EV share in the coming quarters.”

Vivek Anand

opening

“Similarly, we expect market share in the Deluxe 125 segment to expand with our launches planned in the stylish and sporty 125 segments.”

Vivek Anand

opening

“New product launches and strong investment behind building power brands, we expect to grow ahead of the industry.”

Ashutosh Varma

“They are -- I mean, new value propositions for the customers, exciting interventions in the technology space and we expect new customers to be driven into our showrooms basis these new launches.”

Amyn Pirani

“So, some color there on what your thought process is, will be very helpful.”

Ashutosh Varma

“We expect that the entry-level mobility customers, HF will continue to excite them, while Splendor continues to enjoy a very robust and loyal fan following that continues to grow with as we keep adding more variants there.”

Amyn Pirani

“So as your volumes improve in the coming quarters, because partly festive partly because you took the shutdown or the production cut in April, should we expect that a lot of these costs will also have to increase and hence, we should continue to think of that 14%, 14.5% as the range?”

Vivek Anand

“I think we've given the guidance on the margin that the margins will operate between 14% and 16%.”

Risks & concerns — 11 flagged

So again, our understanding was that there is an affordability challenge in that category for a very, very long time.

— Amyn Pirani

So just trying to understand what is your thought process, which obviously you're looking at much more data than we can, as to what is the challenge in this category?

— Amyn Pirani

While yes, affordability is a concern, which also encompasses total cost of ownership and hence, mileage and stuff like that also come in I: Hero there.

— Ashutosh Varma

Is there a risk that it starts moving into the entry-level Splendor price points?

— Amyn Pirani

So what exactly is ailing that business in terms of not able to generate profitability, asset quality being under pressure?

— Kumar Rakesh

Just to really let you know that the full impact of that price increase was not there in the last quarter.

— Vivek Anand

And has the pricing fully passed on the cost pressure?

— Kapil Singh

And with our LEAP program, right, the cost saving program we have, we are confident of neutralizing the impact of that.

— Vivek Anand

Or do we run the risk of the industry, the festive season kind of disappointing on the margins given the high base, right?

— Pramod Kumar

So I mean, in this segment, yes, has been under stress for a while now.

— Ashutosh Varma

So I mean, we've seen this segment to be under stress for a while.

— Ashutosh Varma

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Q&A — 14 exchanges

Just 2 questions. Firstly, on the industry. It did seem like the start of the quarter was pretty strong, but things slowed down towards the end of the quarter at industry level. So if you can talk about 2 things - On industry, One, what is it that we have seen on the ground in rural, urban and why the softness in the month of June and again, July as well? And there's an interesting data point that you put on the financing penetration that it went down for a couple of quarters and now has come back to 65% in July. So what are we seeing on the financing side?

Ashutosh Varma

Hi Gunjan, Ashutosh here. I'll take that question. Yes, you're right. I think what we have seen for the last 4 months is like 2 distinct patterns emerging. When the year started, rural was outpacing the urban growth. For the last couple of months, it's urban that's actually growing a little stronger. What we see is the larger reason, some early arrival of monsoon. I mean, in some I: Hero sense, it has disrupted the last couple of months, but it augurs well for the upcoming festive season. I mean, good sentiments should translate into good market performance. From a financing standpoint, Q1 gen

Actually, my first question was on the HF Deluxe Pro. So again, our understanding was that there is an affordability challenge in that category for a very, very long time. And the product that you have launched, obviously, it has significantly added features, but it's also priced higher. So just trying to understand what is your thought process, which obviously you're looking at much more data than we can, as to what is the challenge in this category? Is it that people are just waiting for a significantly better product even if it is more expensive? Or are they looking for a better price? So,

Ashutosh Varma

Hi Amyn, good to hear you. Let me take this question. So on the entry segment, what we believe is fundamentally, there are 2 levels of challenges. While yes, affordability is a concern, which also encompasses total cost of ownership and hence, mileage and stuff like that also come in I: Hero there. There is also aspiration that drives people to -- and this is their first bike, so into mobility. So our current HF Deluxe continues to remain strong in our portfolio. We have launched the HF Deluxe Pro, which has improved mileage and a lot of new features, graphics, digital meter, LED head lights,

My first question was on the growth expectations. So last quarter, you had spoken about that you expect the industry growth to be about 6% to 7%. So how do we stand on that after how the first quarter has gone by? And your inventory in June quarter inched up to about 6, 7 weeks. I would estimate that in June, July and inventory would be higher than that. So what kind of growth going into festival season you are building in?

Ashutosh Varma

So Rakesh, I mean, the full year growth forecast for the industry, when we started off the year was around 6% to 7%. In the quarter 1, we have seen the retail industry grow at around 3%, 3.5%, so in that range. It has dampened in the last couple of months, but we feel that it's a postponement that should largely come back in festive and hence, should be back to that 6 to 7 growth percent by the festive, and that's our outlook is. In terms of inventory, this is the time when you'll start from here on building stocks for the festive. So yes, we are operating at close to around 7-odd weeks. But a

The first question would be on the Battery-as-a-Service, which was offered with a VIDA V2. If you could give some more details, more on technical parts, how you track it in the profitability for the company for the BaaS service? That will be the first question.

Kausalya Nandakumar

Hi Arvind, this is Kausalya. I think with respect to where we looked at Battery-as-a-Service coming in, at the most fundamental level, we looked at some of the key barriers for people to enter the electric category and address quite a few of them. With respect to how we see the offering, it's a highly differentiated industry-leading offering. We are seeing a lot of customers looking at how they could come into the electric ownership through this model. I: Hero It's -- at a very simple level, it's a pay per kilometer battery subscription model that allows customers to look at the total cost of

My question is on VIDA. We've seen a sharp ramp-up in volumes this quarter. Is this mainly driven by VX2? And what percentage of sales are coming from VX2? Also, if you could talk about what is really working here? Is it the pricing or some features of the product? Is the product gaining share from ICE scooters, or is it the bike customers also who are coming in over here?

Kausalya Nandakumar

Yes. This is Kausalya. We are obviously very motivated and energized by the offtake for the electric portfolio. We are seeing a very healthy mix right now. We have the V2, which is positioned more in the sports range. And we, of course, have the VX2 that's come in to appeal to the segment of family and other buyers. So we have expanded the addressability of the portfolio to more consumers. It's -- again, it's the first month of launch, and therefore, we are ramping up in terms of both product offerings to consumer. In terms of the kind of people who are coming in with the differentiated offeri

My first question is to Ashutosh on the 125cc segment. I think last year with the Xtreme, we had a fairly solid start, very encouraging reviews, customer feedback, even competitors acknowledge that it's a pretty good product. But what we have seen is that we have -- in the last few months or last couple of quarters, the market shares -- Xtreme's volumes have kind of started slipping meaningfully. So, I just want to understand what is holding us back in terms of ramping up on Xtreme, be it in terms of marketing investments or higher dispatches because you still have reasonable distinction versu

Ashutosh Varma

Thanks, Pramod, for this question. Good to hear you again. On Xtreme 125, it continues to be an extremely loved product. In fact, if you look at the sporty 125cc segment as a whole, that has seen some headwinds in this quarter. I mean, hovers around 43-odd percent in terms of contribution to the entire 125cc. I mean, in this segment and almost all players have faced those headwinds. Xtreme continues to gain market share within this sporty 125cc. So if you look at the competition and the players that normally customers keep in the consideration set, we continue to be emerging and gaining market

Just a couple of things. If you could say the price hike that we've taken, what would be the impact for us?

Management

Yes. Could you tell in the 6% Y-o-Y increase in ASP that we've seen, what is the price hike impact?

Vivek Anand

Surely. Yes. So the price increase, what we've taken in the last 4 quarters is around -- okay, we'll share the details separately with you, yes. Vishal, I will it take offline with you. Fair enough. And could you elaborate a bit more on the Battery-as-a-Service economics for the VIDA V2 -- VX2 subscription plan? Hi Vishal, Kausalya here again. We are offering the Battery-as-a-Service right now on the newly launched VX2. We have 2 options. We have the variant called VX2 Go and the feature tech one which is the VX2 Plus. As of now, the Battery-as-a-Service offering goes again for both. On the VX

Congrats for consistently gaining share in electric vehicles and superior ICE margin performance. Sir, if you can help us understand how the ICE scooter portfolio is doing? And any plans to strengthen this scooter portfolio further, including the ICE and EV as well.

Ashutosh Varma

So Amit, from an ICE scooter portfolio perspective, as I just mentioned in the previous answer, I mean, as we are ramping up our supplies, we are seeing great traction. As I said, last couple of months, our overall scooter market share has been north of 6%. We -- the products that we have launched in this category, the 2 new ones that we have launched, the Destini 125 and the Xoom 125 and another impending launch of Xoom 160, we are covered with all the white spaces that are there in terms of the scooter industry. So a pretty well-covered range, meeting all the different kind of consumer requi

I have a question on our 440cc bike segment. In fact, our annual report indicates that now Premia showrooms are scaled up to 80 stores. But still we haven't seen that much of volume scale up for us in this 440cc bikes. Can you shed some light on this?

Ashutosh Varma

Sorry, was your question specifically on 440cc bikes? Darshan M. Bhandarkar: Yes, for like X440 and Mavrick. Okay. Okay. So -- if you look at our Premia expansion, we are expanding rapidly. We have as I -- I mean close to 124-125 now Premia outlets that cover almost 47% to 48% of the entire premium industry -- upper premium industry, which comprises of the 440cc platform as well. We have 2 products here in this space. We have the Harley X440 and we also have Mavrick 440. I mean these are exciting products, which -- where we get a lot of love from the customers. As Mr. Kasbekar said, we are exp

Two questions from my side. First thing is that we are seeing a very good scale-up of our EV portfolio. Kudos on that. I could see a 10,000+ retail number for the month of July, which is I: Hero very encouraging. But just wanted to understand how are we placed given the rare earth conundrum? And how are we addressing that? And my second question is that we have always been a very dominant player in the entry-level motorcycle. So now if I look at it, there has been -- this segment is slowing down a bit. So how are we as the market leaders looking at this problem? And what are the mitigation ste

Vikram Kasbekar

Hi Abhinav, Vikram here. As far as the rare earth metal is concerned, it is an industry-wide phenomenon. It is a challenge, no doubt on that. So the key components of magnet availability in the EV motor, the engine speed and ICE also, so engine speed sensor, wheel speed sensor, et cetera, bank angle sensor. These are all required as a common thing. So we are covered for the quarter 2 FY '26 for both ICE and EV vehicle. And we continue to work on alternatives, and this is something that we will try and see that we circumvent the problem. Yes, I will take the question on entry. So I mean, in thi

So overall, from a sales and service touch points, we operate with more than 6,000 in the market, and we continue to expand in critical areas. Kausalya, do you want to take that question?

Kausalya Nandakumar

Yes. On the VIDA offering, we are focusing on expanding in select network. We are now present in more than 400 cities, and we have a network of more than 600 touch points for consumers. I: Hero VIDA is today offered from Hero as well as from Premia showrooms, and we are now looking to expand that as we ramp-up. Chandramouli Muthiah: Got it. That's helpful. And just as a clarification on Xtreme 125 as well. Is that now available across the 6,000 touch points? Or is that also sort of restricted to Hero 2.0 and Premia only? So, almost all our outlets now are 2.0, from -- I mean, dealership standp

Just want to understand how do you see the ABS regulation for the less than 125cc market? Just want to understand what kind of price hike could be the impact? And what are options you are working with the government to ensure, I mean, not major impact on the industry, sir?

Vikram Kasbekar

Thanks, Mumuksh. Vikram here. I will take that question. As far as the regulation is concerned, MoRTH issued a draft notification on 23rd June, which made ABS mandatory for ICE vehicles less than -- greater than 50 cc and EV greater than 4 kilowatt and effective 1st January '26. Now please note, this is a draft notification. The requirement for this is also going to grow multifold from the current capacity. It will go up as much as 5x. And, the entire industry is trying to look at how to meet these requirements, number one. The second aspect is we are, as an industry and as Hero committed for

Just an extension of the question by the previous participant some time back is you had the entry- level issues in terms of affordability plus aspirational part of it. So is this -- I mean, in terms of the aspirational part, do you see that as a permanent dent in the revival of that markets? Or how do we -- how is our assessment there? If you can just throw some light there?

Ashutosh Varma

Sorry, Milind, I didn't understand the question very well. If you could repeat that, please? Yes. I mean to say if there is a permanent dent in that segment is what we look at because of the segment shifting to the higher end at the entry level itself? Okay. Sorry, got that now. So I mean, we've seen this segment to be under stress for a while. But if you -- at a granular level, I mean, as you study this a lot more, you will see that what -- there has been postponement of purchases in this category for several reasons, right. If you look at, let's say, for example, the average holding time of

Speaking time

Ashutosh Varma

Moderator

Vivek Anand

Vikram Kasbekar

Kausalya Nandakumar

Umang Khurana

Gunjan Prithyani

Amyn Pirani

Kumar Rakesh

Arvind Sharma

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Opening remarks

Umang Khurana

Thank you, Vishakha. Hello, and welcome, everyone, to the Hero MotoCorp Q1 FY '26 Investor Call. On the call with us today, we have our CEO - Vikram Kasbekar; CFO - Vivek Anand; India Business Unit Head - Ashutosh Varma; and Emerging Mobility Business Unit Head - Kausalya Nandakumar, who joins us today. We will start with opening comments from our CEO, followed by comments from the CFO and then take questions. Mr. Kasbekar will start with your opening commentary.

Vikram Kasbekar

Thank you, Umang. Namaskar, and welcome, everyone, to the Hero MotoCorp's Earnings Call for the First Quarter FY '26. I'm sure you must have seen our healthy quarterly performance. We are pleased to report a positive start to the fiscal year with our Vahan market share recovering to 30.9% in quarter 1 FY '26, representing a sequential increase of 1%. The economic landscape appears notably optimistic as we approach our festive season, commencing with Onam on 26th August and Ganesh Chaturthi on 27th August. Multiyear low inflation recorded in June, coupled with significant RBI rate cuts and favorable monsoon should help in demand sentiment as the year progresses. Riding on this positive optimism, we expect two-wheeler demand to continue its upward trajectory as we enter the upcoming festive season. In key business highlights, we continue to gain market share in entry 100cc Deluxe, Scooters and EV business. The company temporarily paused production in April '25, which impacted the overall

Kausalya Nandakumar

Good morning, everyone, and Namaskar. I'm Kausalya. I joined Hero MotoCorp to lead the Emerging Mobility Business in July. I've had close to 2 decades of experience in the automotive sector and a privilege to lead digital start-ups as well as large businesses. I have spent the lion's share of my career in the automotive sector and I'm extremely passionate about energy transition and EV in the mobility space. I am also looking forward to bringing the best of our start-up agility, which is defined by the Emerging Mobility Business Unit and Hero MotoCorp's 40+ years of leadership in this space. Thank you very much, and I look forward to being here.

Vivek Anand

Thank you, Vikramji. Namaskar, very good morning, and thank you all for joining the call. I am pleased to report financial performance for Hero MotoCorp for the first quarter of FY'26. The company recorded quarterly revenue of ₹9,579 crores, EBITDA of ₹1,382 crores and PAT of ₹1,126 crores. The EBITDA margin during the quarter for ICE business improved to 16.8%, driven by mix improvement, price and LEAP savings, while we continue to invest behind brand building and new businesses. During the quarter, after taking into account the investments behind EV business of ₹189 crores, the overall EBITDA margin remains flat at 14.4%. The average selling price increased 6% year- on-year, driven by mix and price. However, average selling price quarter-on-quarter was impacted by seasonality of PAM business. The company reported quarterly revenue from parts, accessories and merchandise business at ₹1,296 crores. Consolidated PAT for the quarter stood at ₹1,706 crores. This includes share of onetime

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