Hero MotoCorp has combined strong sales growth in March 2026 with a strategic investment in the electric vehicle (EV) sector. The company purchased a significant stake in Euler Motors, signaling an aggressive push into electric mobility beyond its traditional two-wheeler business.
Hero MotoCorp ended fiscal year 2026 with strong momentum. In March, vehicle shipments increased 8.8% year-over-year to 598,198 units, supported by a 24% rise in VAHAN registrations to 542,436 units. For the full year, total shipments were about 6.5 million units, up 10% from FY25. Exports also saw a significant jump, growing around 40% for FY26 to reach record levels. Hero's EV unit, VIDA, achieved its highest monthly VAHAN registrations in March and saw its FY26 shipments surge by 154%, showing increasing adoption.
Hero MotoCorp is investing ₹210 crore to buy 2,68,219 Series E preference shares in Euler Motors, giving it a 36.67% stake. Euler Motors, founded in 2018, is a Delhi-based startup focused on electric commercial vehicles. The company has raised over $253 million, with its latest Series E funding closing on March 24, 2026. This move aims to help Hero MotoCorp tap into India's fast-growing EV market, which is expected to expand by over 50% annually. The Indian EV two-wheeler market specifically has grown 37.4% year-over-year in early 2026.
Hero MotoCorp's valuation looks appealing compared to rivals. As of early April 2026, its price-to-earnings (P/E) ratio over the past year is around 19-20x. This is lower than Bajaj Auto's P/E of about 28-29x and TVS Motor's range of 55x to over 84x. While Hero MotoCorp's P/E is just above the Asian Auto industry average of 16.8x, it's well below its peers, potentially indicating a value stock. The company is valued at ₹1.03 lakh crore, with its shares trading about 19.81% below their 52-week high of ₹6,390.
Analyst views on Hero MotoCorp are split. Macquarie upgraded the stock to 'Outperform' in November 2025, noting market share gains in entry-level vehicles and growing presence in electric two-wheelers. MarketsMojo kept a 'Buy' rating in March 2026, citing strong fundamentals and good valuation, though it moved from 'Strong Buy' due to mixed technicals and recent results. Jefferies, however, downgraded Hero MotoCorp to 'Underperform' in December 2025 with a ₹4,950 target price. Jefferies' main worries are slowing demand after GST rate cuts, ongoing loss of market share in key areas, and whether recent price increases are sustainable. Analysts point out that Hero's domestic two-wheeler market share dropped from 36-37% (FY17-FY21) to about 28% (April-November 2025), a 25-year low. This decline, especially in 110-125cc motorcycles and regular scooters, impacts the company, even with its EV market share growth. Jefferies also warned of limited profit growth potential and near-term risks, suggesting recent stock gains were driven by valuation rather than earnings.
India's automotive sector is expected to see moderate growth in FY27, with industry volumes projected to rise 3-6%. Passenger vehicles may grow 4-6%, and two-wheelers 3-5%, following a strong recovery period. The EV market is advancing, supported by government policies and falling battery prices. Competition is intense, as TVS Motor and Bajaj Auto invest heavily in EVs, alongside many new startups.
Hero MotoCorp faces a mixed outlook. Its strong sales are funding expansion into the growing EV sector. However, ongoing worries about losing market share in its core gasoline-powered (ICE) vehicle segments, as noted by Jefferies, pose a major challenge. The success of the Euler Motors deal and its integration will be key to overcoming these hurdles and maintaining leadership in both traditional and new mobility areas.