The second quarter was operationally in-line. On the call, management highlighted first 5 days of festive season have been subdued after the sudden increase in insurance costs, but it still expects overall festive retails to grow by 8-10% Y-o-Y.\u00a0 On the ground, there has been no change in NBFC lending patterns, and Hero\u2019s captive financing arm (Hero Fincorp) is ramping up too. Volume outlook remains strong \u2013 targeting near double-digit volume growth in FY19 (from 14% in FY18). We remain cautious on 2W OEM margin (due to a host of cost pressures), but expect volume to remain healthy. Our numbers were conservative and thereby unchanged, but we trim our target multiple a notch due to host of macro challenges. Maintain \u2018buy\u2019 with revised TP of\u00a0 Rs 3,369 (10x FY20E EV\/EBITDA) vs Rs 3,755 earlier. Hero improved its deluxe motorcycles market share YoY, while overall motorcycle market share was maintained. Spare parts revenues in Q2 stood at Rs 710 crore (up 24% Y-o-Y and 18% Q-o-Q). Hike in insurance costs and confusion around insurance duration softened demand a bit and led to flattish growth in the first few days of festive season. However, the demand has improved in the last 2-3 days. Financing companies have also helped tackle the higher insurance costs. Net increase in EMI due to higher insurance costs is just Rs 200 for a 24-month duration for a Rs 45-k loan. Management expects 8-10% growth in the festive season. Demand has been fairly consistent with rural slightly stronger vs. urban. Going forward, management expects rural centres to outperform urban. Fuel cost increase does not impact monthly fuel expenditure for 2W consumers significantly.