Hero MotoCorp down 5%; why world's largest 2W maker is under pressure?

Hero MotoCorp share price today

 

Shares of Hero MotoCorp, the world's largest manufacturer of motorcycles and scooters, slipped 5 per cent to ₹5,284 on the National Stock Exchange (NSE) in Tuesday's intraday trade on profit booking, as the company reported a decline in total sales for the month of October 2025.

 

With today's fall, the stock price of Hero MotoCorp has corrected 8 per cent from its 52-week high level of ₹5,717, which it touched on October 23, 2025.

 

Despite this, the stock of Hero MotoCorp has outperformed the market in the past six months by surging 41 per cent, as compared to a 5 per cent rise in the Nifty50 and 17 per cent rally in the Nifty Auto index during the period.

Hero MotoCorp October auto sales data

 

Hero MotoCorp, on Monday, reported a 6.4 per cent year-on-year (Y-o-Y) fall in total sales to 6.35 lakh units in October 2025, compared to 6.79 lakh units in the same month last year. The company's domestic sales data, which was revealed after market hours yeesterday, fell 8 per cent to 6.04 lakh units from 6.57 lakh units, while exports jumped 42.8 per cent to 30,979 units, up from 21,688 units a year ago.

 

The company recorded its second successive month of the festive season sales with over 6 lakh wholesale dispatches in October 2025. The positive performance, as per the company, reflected sustained festive momentum and renewed customer confidence, further supported by favorable market conditions, including GST benefits.

 

The recent GST benefits, announced by Prime Minister Narendra Modi, at the onset of the festive season provided a significant boost to consumer sentiment, revitalising retail momentum across markets. With continued festive enthusiasm and improved consumer confidence, Hero MotoCorp expects a sustained retail trajectory in the coming months.

 

Meanwhile, with a strong product line-up, robust domestic demand, and expanding international presence, Hero MotoCorp management believes the company is well-positioned for sustained growth through the remainder of FY26. The company said it continues to strengthen its mobility ecosystem across ICE, premium, and electric vehicle (EV) segments, backed by cutting-edge technology and customer-centric innovation.  ALSO READ | 3M India, IOC, Titan, JK Tyre: Stocks at 52-week high; buy or sell?

Axis Securities on 2W sector

 

Despite being the largest volume contributor to India's auto industry, entry-level segment 2Ws have been under stress for several quarters due to weak rural incomes and higher ownership costs. A reduction of GST on entry-level motorcycles and scooters from 28 per cent to 18 per cent would significantly improve affordability, especially in the 100–125cc commuter segment, which caters to price-sensitive buyers.

 

Market leaders such as Hero MotoCorp, Bajaj Auto, and TVS Motor stand to gain directly from this reform, as volume recovery in rural and semi-urban markets could accelerate meaningfully from H2FY26 onwards, the brokerage said.

 

About 50 per cent of Hero’s sales come from rural/semi-urban markets, where affordability has been a key constraint. With GST cuts and income-tax relief improving disposable incomes, Hero is best placed to ride the rural recovery. Hero is also consciously expanding into 125cc+ and premium bikes (Xtreme, Xpulse, Harley JV). Incremental demand recovery at the bottom of the pyramid gives Hero the cash flow support to sustain this diversification strategy, analysts at Axis Securities said.

 

With a robust balance sheet, strong FCF, and consistent dividend payouts, the company is well-positioned to provide stability and offers re-rating potential in a consumption-led upcycle, the brokerage firm had said in a company report in September. Analysts maintained a 'Buy' rating on the stock with a share price target of ₹ 5,960 per share.