Hero MotoCorp has become the first two-wheeler maker in the world that has sold over 7.5 lakh units in a single month. This huge growth is on the back of majorly company’s range of motorcycles and scooters in the 100-200 cc segment. Should investors rejoice?
Stock Price Chart of Hero Motocorp
The stock is trading at the level of Rs.2965, has immediate support at Rs. 2913 level and resistance at Rs.3339
Hero MotoCorp to hike prices
Hero MotoCorp expects that the upcoming festival season in October and November, the company may set up another global benchmark in retail sales in this year.
The company has planned to increase the prices of their entire range of portfolio of products by up to ₹900, effective from 3 October.
The company is taking this step in order to offset the impact of rising input costs and weakening of rupee against the dollar. The oil price has moved up to four years high and the rupee has weakened to record low against the dollar. However, the exact amount of increase will vary, which will depend on the basis the model and the specific market.
This will be the second time this year that the company has been forced to increase the prices of its products. In April 2018, the company had increased the prices by upto Rs 625 to offset the rise in raw material costs.
Meanwhile, the company has sold 7,69,138 units in September, which corresponds to 6.72% rise in total sales. The company had sold 7,20,739 units in the corresponding month last year.
Making in India, for the World!
Proud to become the 1st two-wheeler Company to surpass the 750,000 mark in monthly sales.
Clocking 769,138 units of motorcycles & scooters in September 2018 – highest-ever sales in any month https://t.co/8znqiLvUOn
— Hero MotoCorp (@HeroMotoCorp) October 1, 2018
Further, this means that the company is selling 25,637 units every day. Hero Motocorp has in September achieved the highest monthly sales for the company.
This is for the fifth time the company has managed to cross the seven lakh sales mark in a month, in which three out of five times was achieved in this financial year 2018-19.
In the first six months of this FY 19 (April-September), the company has already crossed 4.2 million units sales mark.
Should you Buy for Long Term?
The company has planned to launch four motorcycles with 200-300cc engine capacity over the next 18 months. This is due to fact that the sales in this segment have grown nearly five-fold from 220,000 motorcycles in 2011-12, to 1.02 million in 2017-18.
With the upcoming festival season and the company posting strong sales every month, the company is expected to continue to perform strongly in October and November also. The long term target on the stock is Rs.3600