Slowing entry segment volumes may derail Hero MotoCorp's sales trajectory

While overall two-wheelers sales are down, what is hurting Hero MotoCorp is that the slowdown is impacting the entry and executive segments the most

Shares of India’s largest two-wheeler maker, Hero MotoCorp have fallen nearly 15 per cent from the closing highs of March 2, far more than the 6.7 per cent decline in the S&P BSE Auto index during this period. Investors are concerned that slowing demand in Hero MotoCorp’s bread-and-butter segments, large inventory and rising commodity prices will dent its near term operating performance.

Demand pressures have increased due to a sharp increase in the cost of ownership led by successive price hikes taken by two-wheeler makers and the increase in prices of petrol. Customers are either postponing purchases due to this