Hero MotoCorp FY26 Annual Earnings Summary
4 quarters covered · ₹47,411 Cr revenue · ₹5,776 Cr PAT · 14.3% average EBITDA margin.
Quarter-by-quarter progression
Management promises made during the year
Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q1 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q1 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q2 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q2 FY26Current-quarter results and commentary indicate the prior promise was delivered or materially on track.
Q3 FY26Current-quarter results and commentary indicate the prior promise was delivered or materially on track.
Q3 FY26Current-quarter results and commentary indicate the prior promise was delivered or materially on track.
Q3 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q4 FY26Risks flagged during the year
Industry-wide rare earth shortage affecting magnets for EV motors and sensors; Hero covered for Q2 but uncertainty beyond.
Q4 FY26 · highRising prices of aluminum, steel, rubber, and plastics due to West Asia tensions are pressuring margins; management expects a transitory impact but cannot fully quantify.
Q1 FY26 · mediumDraft notification mandating ABS for vehicles >50cc from June 2026 could increase costs significantly; industry seeking timeline extension.
Q1 FY26 · mediumEntry-level motorcycle segment under prolonged stress due to affordability and aspiration shifts; recovery uncertain.
Q1 FY26 · mediumHFCL profitability impacted by high credit cost and NPAs; management expects improvement with falling rates but no timeline given.
Q2 FY26 · mediumAluminum prices have risen and may cause 1%-2% commodity inflation in Q3, potentially pressuring margins.
Q2 FY26 · mediumDraft notification for mandatory ABS may be implemented from January, but no final notification yet. Management is in talks with the government.
Q2 FY26 · mediumWhile current momentum is strong, management's H2 growth guidance of 8%-10% implies a slowdown from festive peaks, and any macro shock could derail demand.
Q3 FY26 · mediumRising aluminum and precious metal prices, along with forex impact, are pressuring margins. Management estimates 40-50 bps impact in Q3 and expects similar in Q4.
Q3 FY26 · mediumAnalyst raised concern that price increases to offset commodity costs could dampen demand, especially after GST-driven price reductions.
Q3 FY26 · mediumManagement acknowledged supply bottlenecks for Xtreme 125R due to strong demand and common platform with exports, which could limit near-term sales.
Q4 FY26 · mediumEV investments (INR 220 crore in Q4) continue to drag overall margins; management did not provide a timeline for breakeven, though PLI benefits and cost reductions are expected to help.
What changed through the year
Q1 FY26 · Industry growth of 6-7% for FY26
Management expects full-year two-wheeler industry growth of 6-7%, with festive season demand recovery offsetting Q1 softness.
Q1 FY26 · EBITDA margin guidance of 14-16%
CFO reiterated margin guidance of 14-16%, with short-term operating at lower band due to investments.
Q1 FY26 · Global business to contribute 10% of revenue/volumes
Target to achieve 10% of revenue and volumes from global business, with over 40% growth expected this year.
Q1 FY26 · New 125cc motorcycle launches in Q2
Two new 125cc motorcycle launches planned in Q2 FY26 to disrupt the deluxe segment with best-in-class technology.
Q2 FY26 · H2 FY26 industry growth of 8%-10%
Management expects the two-wheeler industry to grow 8%-10% in the second half of FY26, with Hero poised to outperform and gain market share.
Q2 FY26 · EBITDA margin guidance of 14%-16%
CFO reiterated the company's EBITDA margin guidance of 14%-16%, with continued investments in brand, products, and EV.
Q2 FY26 · Continued market share gains in H2
Management expects to continue gaining market share across segments, driven by new products (Glamour X, Xtreme 125R, scooters) and strong festive momentum.
Q3 FY26 · Industry growth of high single digits in FY27
Management expects the two-wheeler industry to grow in high single digits in FY27, with moderation in H2 due to high base.
Q3 FY26 · Price hike of INR 300 per vehicle in January
Hero took a price increase of INR 300 per vehicle in January to mitigate commodity cost inflation.
Q3 FY26 · EV capacity expansion in FY27
VIDA expects a market increase in capacity in FY27 to meet growing demand.
Q4 FY26 · Industry growth of high single-digit in FY27
Management expects the two-wheeler industry to grow at a high single-digit rate in FY27, with scooters growing slightly faster than motorcycles.
Q4 FY26 · Company to outgrow industry in FY27
Hero MotoCorp expects to grow ahead of the industry in both motorcycles and scooters, driven by new launches and capacity expansion.
Q4 FY26 · CapEx of INR 1,500 crore in FY27
The company has committed over INR 1,500 crore of capital expenditure in FY27 for capacity expansion in scooters, EV, and a global parts center.
Q4 FY26 · Medium-term EBITDA margin guidance of 14%-16%
Management reaffirmed its medium-term margin guidance of 14%-16%, despite near-term commodity headwinds.