Hero MotoCorp and Eicher Motors reported Q4FY24 results in line with expectations. With robust sales, exports, and analyst optimism, both two-wheeler stocks show growth potential. Target prices range from ₹4,614 to ₹5,030 for Hero and ₹4,560 to ₹6,500 for Eicher.
Hero MotoCorp and Eicher Motors, two of India’s leading two-wheeler manufacturers, reported their Q4 FY24 results last week. Both companies met analysts’ expectations, supported by higher volumes, improved average selling prices (ASP), stronger exports, and an enhanced product mix.
With these results, analysts have maintained a positive outlook on both stocks, underpinned by their market positions, strategic plans, and recent product launches. Here’s how the two companies stack up post-Q4.
Hero MotoCorp: Backed by Rural Demand and Product Strategy
Hero MotoCorp is expected to benefit from a mix of macroeconomic and seasonal factors. The government’s efforts to increase rural income, a rise in disposable income from the Union Budget, and seasonal wedding demand are seen as potential growth drivers for Hero, especially in rural areas where the company has a strong foothold.
Brokerage Targets:
- Axis Securities: Retains a ‘Buy’ with a target of ₹5,030. The valuation includes Hero’s 38% stake in Ather Energy and Hero FinCorp.
- Motilal Oswal: Maintains a ‘Buy’ rating with a target of ₹4,761, expecting a 5% volume CAGR over FY25–27.
- Nomura: Raises target to ₹4,614 from ₹4,594, with a continued ‘Buy’ recommendation.
- JM Financial: Re-initiates coverage with a ‘Buy’ and a target price of ₹4,700.
Analysts are also monitoring Hero’s roadmap for electric vehicles (EVs), its mid-weight motorcycle strategy, and international market expansion.
Eicher Motors: Premium Segment Growth and Exports Drive Optimism
Eicher Motors, known for its Royal Enfield brand, is projected to gain from recovery in the premium motorcycle segment (>350cc) and export markets. The company has also seen traction from recent product launches.
Brokerage Targets:
- Nomura: Maintains a ‘Reduce’ rating, slightly lowering the target to ₹4,560.
- Jefferies: Reduces target to ₹6,500 from ₹6,700 but keeps a ‘Buy’ recommendation.
- Citi: Raises target price to ₹6,200, exceeding its recent high of ₹5,906.
- HSBC: Maintains a ‘Hold’ with a target of ₹5,300.
Despite recent high valuations, Eicher Motors continues to enjoy strong investor interest due to its consistent growth and premium positioning.
Conclusion: Which Stock Looks Better?
- Hero MotoCorp is positioned to benefit from rural tailwinds, increased demand, and strategic investments in EVs and exports.
- Eicher Motors offers strength in the premium category, export growth, and brand loyalty through Royal Enfield.
Both companies show potential for future upside. However, investors looking for rural growth and value positioning may prefer Hero MotoCorp, while those targeting premium motorcycle demand and global expansion might lean toward Eicher Motors.
