Hero MotoCorp Market Share Dips To 29 Percent, Eyes Steady Recovery Ahead

Hero MotoCorp’s domestic two-wheeler market share declined from 36% in FY19 to 29% year-to-date in FY25. The fall is linked to weak rural demand, price increases and a slower presence in the premium motorcycle and scooter segments. The company expects market share to stabilise in the coming quarters, helped by improving rural incomes, replacement demand and new models in the 125cc and higher categories.

After a slow April, Hero adjusted dealer inventory to around 4–5 weeks. This was supported by strong retail demand in May, driven by a higher number of wedding days. Retail volumes for May 2025 are estimated between 550,000 and 600,000 units, up from 450,000 last year. The festive season in FY26 is expected to begin about 13 days earlier than the previous year, which may result in better dealer stocking and a projected 7% growth in wholesale volumes in H1 FY26. This implies a 17% year-on-year increase during the May–September period.

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Hero's EV division, Vida, ended FY25 with a 4% share in the electric two-wheeler segment. After pricing adjustments and the launch of the V2 Lite model, the share has risen to around 6–7% in recent months. In Karnataka, the largest EV market, Vida's share reached 8% in April-May 2025. Similar trends have been noted in Delhi, Uttar Pradesh, Rajasthan and Maharashtra.

Hero invested Rs 1.43 billion in its EV segment during Q4 FY25. EV sales rose 20% in 30 cities and 10% in 60 cities on a year-on-year basis. Breakeven is expected at monthly sales of 25,000–30,000 units, a target the company estimates may take at least two years to achieve. A PLI application for the Vida Pro is under review, with other product filings underway.

Hero's exports rose by 43% in FY25 and they were able to capture a 9% market share in international markets, with 40% of export sales coming from premium motorcycles. Company reported Growth in Bangladesh, Colombia and Mexico. The company has resumed operations in Nepal and entered Sri Lanka and the Philippines, aiming to continue this trend in FY26.

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Retail finance penetration averaged 63% in FY25. Although some finance providers are under pressure, no major risks have been reported.

In the ICE segment, EBITDA margins stood at 16.1% in Q4 FY25, supported by a better product mix, reduced material costs, and operational savings. The company expects margins to remain between 14% and 16%.

A 2% price hike due to OBD 2B compliance has been implemented. The full impact of this hike is expected from Q1 FY26. Around two-thirds of the average selling price increase is attributed to a shift in model mix, with the remaining one-third coming from the price increase.

Hero MotoCorp Limited has acquired a 34.10% equity stake in Euler Motors Private Limited. The acquisition includes 10 equity shares and 6,65,914 Series D cumulative compulsorily convertible preference shares. The total investment is valued at Rs 510 crore.