Hero MotoCorp, the country’s largest two-wheeler maker, said it is seeing an encouraging demand trend so far in the festive season this year.
The company, which depends overwhelmingly on the mass segment within the motorcycle market, was hit hard by a sharp decline in demand for entry-level motorcycles this year, even as rivals shifted focus to their premium models. It was also hit hard by poor demand in another segment — the rural market.
The two-wheeler maker had, three months ago, predicted that rural demand would pick up just before the festival season as the cash starts coming in from the Kharif harvest. India’s kharif crops, including rice, wheat and maize, are sown in June and harvested in October and November.
Going by the company’s commentary today, the bet on a post-harvest revival seems to have paid off.
“We have seen that the rural demand has picked up quite well…we have seen that in the first seventeen days of the festival season,” said Ranjivjit Singh, Chief Marketing Officer at Hero MotoCorp, in a post-earnings conference call. “That is always good news for this industry when rural also kicks in.”
He said there has also been an uptick in the number of first buyers especially in the rural market, in terms of two-wheelers.
Singh said the company anticipated this and worked out strategies to harvest this demand across its portfolio of bikes.
“We have put our best foot forward to inspire and invite the entry-level consumers to come into the market..that is working very well…At the entry-level, HF Deluxe is doing well.,” Singh said.
The HF Deluxe is one of the most affordable bikes in the Hero India range. Despite the comparatively lower cost, the bike comes with features such as self-start and alloy wheels. It was one of the first Hero bikes to be updated with IBS (Integrated Braking System). The self-start model is available at prices starting from Rs. 68,412.
Singh said the schemes and features around the product have been built to make it irresistible to entry-level customers.
“We believe they have confidence in HF Deluxe and the proposition we have there, with the financial schemes, the activations we have done in the rural market ..”
Other Models
In addition to HF Deluxe, some of the company’s new launches have also done exceptionally well during the festive season, it said.
One of these is the Hero Passion Plus, which was reintroduced in June 2023.
“It is a very loved, million units per year kind of a brand..the styling and other factors have definitely hit a home run.. it is doing very very well,” said Singh.
He also added that much like in the ad campaign ‘Pehla Pyar’, existing customers who have been holding on to this model are exchanging their old bikes for the new model.
At the same time, even first-time buyers are also choosing this model, the company said.
Another model that has been making some noise during the festive season is the new Glamour Classic, powered by a 125 CC engine and launched in August. The bike has done well and has boosted sales across the country, said the company.
“It has taken on very well,” Singh said. “This is significant because markets like AP, Telangana and East where Glamour has been very popular in the past, are coming back well again.”
At the same time, Singh said, the revival is not confined to any one particular geography.
“We are seeing the growth to be very spread out…for example, Rajasthan is reeling in growth, the central zone is doing very well, we have also got the North kicking in well while the South is also doing extremely well..,“ Ranjivjit Singh said.
With rural demand increasing, and rising acceptance of its products among the youth, the company expects its growth to shoot up further during the coming months.
“Demand will continue to be robust and strong over the next two quarters.,” said Singh, adding that the festive season is powering up the whole automobile industry.
“I believe the industry is also doing well .,” he said.