Hero eyes 6x EV sales leap to turn profitable by 2027 amid fierce competition
India's largest two-wheeler maker, which sold about 4,000 electric scooters a month on average in FY25, wants to achieve monthly sales of 25,000-30,000 units as it scales up the business amid intense competition with market leaders Ola Electric Mobility Ltd, TVS Motor Company Ltd and Bajaj Auto Ltd.
This would translate to annual sales of about 360,000 units by Hero MotoCorp in 2027-28. In the financial year ended 31 March, Ola Electric led the pack with 344,009 e-scooter sales, followed by TVS and Bajaj Auto that sold 237,576 units and 230,806 units, respectively.
To be sure, market leader Ola Electric's founder Bhavish Aggarwal said in February that the firm would need 50,000 monthly sales of its electric scooters to break even.
The Delhi-based Hero's earnings before interest, taxes, depreciation, and amortization (Ebitda) margin for the EV business improved from -155% in FY24 to -95% last year, as sales picked up pace.
'Profitability will be led by increasing scale, cost reduction by increasing localisation and the realisation of production linked incentive (PLI) benefits,' acting chief executive officer Vikram Kasbekar said during the post-Q4 earnings call on Wednesday.
The company recorded a 175% rise in sales of its electric Vida scooters to reach 48,674 units during the year, as per Federation of Automobile Dealers Associations (FADA) data. For its Vida Pro model, the company will apply for PLI benefits by July this year.
The bid to achieve profitability comes as the competition intensifies in the electric vehicle space.
Saji John, senior research analyst at Geojit Financial Services, said, "Hero's path to profitability looks plausible but there is still a long way to go. The company will look to expand its dealer network and compete with the leaders. Key thing to watch for will be how their affordable products in the electric space do."
Hero MotoCorp entered the electric two-wheeler space in 2022 with its scooter Vida. In the first year, it managed to sell just about 1,000 vehicles. But since then, the company has seen growth pick up pace on the back of launches in the mass segment.
Last fiscal, the company launched the Vida V2 scooter under the ₹ 1 lakh bracket, which the management believes has helped in boosting sales. Its market share grew from 1.87% to 4.23% during the year.
'We exited March with a market share of 7% and the growth is expected to continue as we scale up our products,' Kasbekar said.
The company is looking to launch two new affordable models in the electric segment in the first half of this financial year. Its new electric Vida Z model will also be launched in July, which will be sold in the European and UK markets.
The company announced on Tuesday that Hero MotoCorp will enter the European and UK market in the second half of the financial year.
The Delhi-based company's revenue from operations rose 9% to ₹ 40,756 crore for the fiscal year ended 31 March. Its Ebitda margin for the year increased 40 basis points to 14.4% due to higher sales of premium motorcycles. Its net profit jumped 16% to ₹ 4,610 crore.
Hero MotoCorp recorded sales of 5.9 million scooters and motorcycles in FY25, a growth of 5% against the year-ago period.
For the EV business, analysts remain optimistic that new launches in the affordable segment should manage to help the company post growth during the quarter.
'Its current market share in the premium and EV segments is in single digits, offering scope for increase with new models,' Raghunandhan NL, Manav Shah and Rahul Kumar of Nuvama Institutional Equities wrote in a 14 May note.
The electric business for most of the electric two-wheeler makers has remained a loss-making enterprise. Bengaluru-based Ola Electric posted a loss of ₹ 564 crore in the third quarter of the last financial year, while Ather Energy posted a loss of ₹ 234 crore in January-March of 2025.
However, the country's third-largest EV two-wheeler maker Bajaj Auto Ltd said after the release of its October-December earnings that its electric business had turned profitable.
As many as 1.15 million electric two-wheelers were sold in India in FY25, rising 20% from a year prior.
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