Hero to hike scooter production to boost mkt share

Oct 14, 2013, 08.46 PM IST

Over the next few months, Hero MotoCorp plans to take their overall scooter production to around 75,000 units per month as compared to 55,000-60,000 units that they currently do.

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Over the next few months, Hero MotoCorp plans to take their overall scooter production to around 75,000 units per month as compared to 55,000-60,000 units that they currently do.

Like this story, share it with millions of investors on M3

Hero to hike scooter production to boost mkt share

Over the next few months, Hero MotoCorp plans to take their overall scooter production to around 75,000 units per month as compared to 55,000-60,000 units that they currently do.

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Hero MotoCorp is betting big on scooters and plans to increase scooter production by 33 percent in next few months because they see a lot of headroom for growth, reports CNBC-TV18's Ronojoy Banerjee.

Currently, Hero and its erstwhile partner Honda together hold a majority market share of 70 percent post Bajaj Auto exiting the scooter segment around three years back.

This move by Hero MotoCorp comes at a time when it is facing a lot of competition in its core motorcycle segment where they currently have nearly 52 percent market share. They believe their focus on scooter segment could take their overall scooter share to almost 25 percent as compared to the current 20 percent.

Also read: Hero MotoCorp unveils 15 new products

In this financial year from April to September, the company's scooter business has grown over 40 percent as compared to a decline in its motorcycle sales by 3 percent during the same period.

Over the next few months the company plans to take their overall scooter production to around 75,000 units per month as compared to 55,000-60,000 units that they currently do, according to some company executives that CNBC-TV18 spoke to.

Moreover, "Leap" which was the hi-tech hybrid scooter that Hero had showcased last year in the auto expo would be production-ready by February and would once again be showcased in the auto expo. However, they have not taken a call on when it will be launched.

On October 14, 2013, Hero Motocorp closed at Rs 2100.05, up Rs 22.05, or 1.06 percent. The 52-week high of the share was Rs 2127.70 and the 52-week low was Rs 1434.05.

The company's trailing 12-month (TTM) EPS was at Rs 102.72 per share as per the quarter ended June 2013. The stock's price-to-earnings (P/E) ratio was 20.44. The latest book value of the company is Rs 250.70 per share. At current value, the price-to-book value of the company was 8.38.

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