Hero MotoCorp Q4 Review: Mixed Brokerage Reactions As Higher Selling Prices Drive Earnings Beat

Hero MotoCorp's fourth-quarter results for FY25 have garnered mixed reactions from leading brokerages. JPMorgan has highlighted that the earnings have been better-than-expected, driven by higher selling prices. Goldman Sachs, on the other hand, has noted an in-line performance with a focus on the company's outlook for FY26 and management transition.

Hero MotoCorp reported a 4% year-on-year increase in revenue, reaching Rs 9,900 crore, and a 4% rise in Ebitda to Rs 1,420 crore. The Ebitda margin stood at 14.2%, slightly lower by 22 basis points quarter-on-quarter. Adjusted profit after tax was Rs 1,080 crore, up 6% year-on-year.

Here's what the brokerages said:

JPMorgan indicates that Hero MotoCorp's operating results were slightly ahead of both their own and consensus expectations. This was largely driven by higher realisations, which were 3% above JPMorgan's estimates. "Margins were in-line despite costs being higher than expected, largely on the back of better ASPs," the brokerage noted.

However, JPMorgan flagged concerns over other expenses, which grew 13% year-on-year and were 6% higher than their estimates, despite a 1% decline in volumes. "We do not expect any meaningful revisions to consensus forecasts based on this result," it added.

The brokerage further added, "management commentary on the industry volume growth outlook and market share will determine the trend in estimates. "

Goldman Sachs reported that Hero MotoCorp's fourth-quarter performance was in line with expectations, with revenue and Ebitda both up by 2%, compared to Bloomberg consensus. "Revenue growth came in at 4% higher year-on-year, with ASP up by 5%," the brokerage noted.

The brokerage also highlighted some of the key focus areas that could be discussed in the company's May 14 call and they included underlying trends in the rural two-wheeler market, the outlook for FY26, updates on the ongoing search for new management, the channel stock situation following recent moderation in wholesale growth, and details of the upcoming electric vehicle launch.

"Management expects to make an EV launch in the near term," it noted.