Hero MotoCorp Ltd is set to benefit from a sustained recovery in domestic two-wheeler demand, supported by improving rural sentiment and strong acceptance of recent product launches, according to a recent report Motilal Oswal.
The brokerage said Hero MotoCorp expects demand momentum to continue into the second half of FY26, with overall industry volumes projected to grow in the range of 8–10%. Management indicated that demand has been broad-based across categories, with entry-level motorcycles seeing particularly strong traction as rural consumption improves after a prolonged slowdown.
Reclaiming the 125cc Volume
The brand will increase its strategic focus on the the 125cc motorcycle segment, where it has lost market share in recent years. With the the upgraded Glamour and the Xtreme 125R, now offered with dual-channel ABS. Both models have seen encouraging customer response thus signaling a recovery in this segment and helping the company claw back in one of the most volume-intensive categories of the market.
The emphasis will be on extracting greater value from existing products through focused marketing initiatives and sharper positioning. This means, given the scale of launches undertaken over the past year, there will not be any new product introductions in the near term for Hero MotoCorp.
That said, the overall product pipeline remains active. Upcoming launches include additional variants of the Xtreme in the premium motorcycle segment, There will also be further versions of the recently unveiled HD 440, and multiple new offerings under the Vida electric brand. Additionally, the company also plans a couple of upgrades in the premium segment next year.
Scaling EV Dominance
On the scooters front, the Destiny 125 has helped Hero MotoCorp outperform peers in recent months, resulting in an 80 basis-point year-to-date increase in scooter market share to 5.9%. According to Motilal Oswal, Hero Motocorp’s electric scooter business is also gaining traction. The Vida VX2 has achieved a market share of around 12% in the electric scooter segment, with management targeting a 14–15% share by March 2026.
Exports currently contribute about 8% of total volumes, with the company aiming to increase this to 10% by March 2026. Hero MotoCorp’s export strategy of concentrating on its top ten overseas markets, together accounting for roughly 80% of its export volumes, has helped revive momentum in international operations. The focus markets include Bangladesh, Colombia, Mexico, Nigeria, Turkey, Nepal, Sri Lanka and the Philippines, where Hero MotoCorp enjoys an average market share of around 12%. Product launches in these regions have been tailored to local requirements, supported by strengthened dealer networks and improved aftersales infrastructure. Notably, premium motorcycles now account for nearly 40% of export volumes, led by models such as the Xtreme 160, Xtreme 250 and Xpulse 200. The company is also working to enhance export capacity to cater to rising demand.
Overall, Hero MotoCorp seems to be well placed to sustain growth across motorcycles and scooters in the domestic market, while steadily scaling up its electric vehicle business and rebuilding momentum in exports, supported by a refreshed product portfolio and improving demand conditions, according to Motilal Oswal.