Buy Hero MotoCorp, target price Rs 3300: Axis Securities

Axis Securities has buy call on Hero MotoCorp with a target price of Rs 3300. The current market price of is Rs 2950.05. Time period given by analyst is one year when Hero MotoCorp Ltd. price can reach defined target.

Hero MotoCorp Ltd., incorporated in the year 1984, is a Large Cap company (having a market cap of Rs 58901.20 Crore) operating in Auto sector.

Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 8758.01 Crore, down -12.70 % from last quarter Total Income of Rs 10032.61 Crore and up 34.93 % from last year same quarter Total Income of Rs 6490.54 Crore. Company reported net profit after tax of Rs 847.53 Crore in latest quarter.

Investment Rationale
Hero is witnessing an improvement in the exports, aided by a low base and revamped strategy in the key countries. Currently, export volumes comprise a minuscule 2%-3% of total volumes. Hero is exploring opportunities in destinations such as Colombia, Bangladesh, Nepal, Sri Lanka, Africa, and Mexico to enhance exports’ share. Recently, it has also partnered with a distributor in Mexico. The company plans to focus on the top 5-6 export destinations where the market size is large enough.

Promoter/FII Holdings
Promoters held 34.8 per cent stake in the company as of March 31, 2021, while FIIs held 37.2 per cent, DIIs 18.7 per cent and public and others 9.4 per cent.