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What is the story about?
Shares of two-wheeler maker Hero MotoCorp Ltd
. were trading over 2% higher on Thursday, November 20, extending gains for the fourth straight session. The stock also hit a 52-week high of ₹6,016 today.
The upmove comes after global brokerage firm Macquarie upgraded the stock to 'Outperform' with a price target of ₹6,793.
The brokerage said domestic market share has stabilised and highlighted upside risks in both motorcycles and scooters, led by GST reduction and upcoming product launches.
It added that electric two-wheeler (E2W) traction is improving and margins remain resilient as ICE (internal combustion engine) profitability continues to surprise positively.
Macquarie flagged key catalysts like market share gains in ICE two-wheelers, a pickup in electric two-wheeler volumes and consistent margin delivery.
It also mentioned that the Street may be more willing to assign a higher multiple.
This marks the second upgrade in two days. On Wednesday, JPMorgan raised its rating to 'Overweight' and increased its price target to ₹6,850.
The upgrade was driven by early signs of market share stabilisation after years of erosion, along with a better demand outlook helped by new launches and tighter inventory management.
JPMorgan said the recent GST cuts have revived demand in the lower half of the two-wheeler market, where Hero has a strong presence. It also highlighted improving traction in Hero's electric two-wheeler portfolio, which had been a concern earlier.
The brokerage expects the valuation gap to narrow as fundamentals continue to strengthen.
Among 42 analysts covering the stock, 24 have a 'Buy' rating, 13 recommend 'Hold' and five suggest 'Sell'.
Hero MotoCorp shares were trading 2.14% higher at ₹6,002 on Thursday. The stock is up 44% so far this year.
The upmove comes after global brokerage firm Macquarie upgraded the stock to 'Outperform' with a price target of ₹6,793.
The brokerage said domestic market share has stabilised and highlighted upside risks in both motorcycles and scooters, led by GST reduction and upcoming product launches.
It added that electric two-wheeler (E2W) traction is improving and margins remain resilient as ICE (internal combustion engine) profitability continues to surprise positively.
Macquarie flagged key catalysts like market share gains in ICE two-wheelers, a pickup in electric two-wheeler volumes and consistent margin delivery.
It also mentioned that the Street may be more willing to assign a higher multiple.
This marks the second upgrade in two days. On Wednesday, JPMorgan raised its rating to 'Overweight' and increased its price target to ₹6,850.
The upgrade was driven by early signs of market share stabilisation after years of erosion, along with a better demand outlook helped by new launches and tighter inventory management.
JPMorgan said the recent GST cuts have revived demand in the lower half of the two-wheeler market, where Hero has a strong presence. It also highlighted improving traction in Hero's electric two-wheeler portfolio, which had been a concern earlier.
The brokerage expects the valuation gap to narrow as fundamentals continue to strengthen.
Among 42 analysts covering the stock, 24 have a 'Buy' rating, 13 recommend 'Hold' and five suggest 'Sell'.
Hero MotoCorp shares were trading 2.14% higher at ₹6,002 on Thursday. The stock is up 44% so far this year.
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