India’s two-wheeler market is in focus today (May 7) after the March quarter earnings. Brokerage houses are also closely tracking these auto sector stocks. In the latest report, the brokerage houses such as Nuvama and Nomura have given its outlook at two of the country’s biggest motorcycle makers – Hero MotoCorp and Bajaj Auto.
From rural demand and electric vehicle launches to exports and premium bikes, both companies are trying to strengthen their positions in different parts of the market. While Hero MotoCorp continues to lean on its mass-market strength through brands like Splendor, Bajaj Auto is betting heavily on exports, premium motorcycles and electric mobility through Pulsar and Chetak.
Bajaj Auto Vs Hero MotoCorp: Nuvama view
The brokerage house Nuvama has maintained a ‘Buy’ rating on Hero MotoCorp with a target price of Rs 6,000. This implies an upside potential of around 17% from the current market price. Nomura, however, has retained a ‘Neutral’ rating on the stock with a target price of Rs 5,783, indicating nearly 12% upside potential.
| Stock | Brokerage | Rating | Target Price | Upside Potential |
| Hero MotoCorp | Nuvama | Buy | Rs 6,000 | 17% |
| Bajaj Auto | Nuvama | Buy | Rs 11,600 | 15% |
Nuvama has also retained a ‘Buy’ rating on Bajaj Auto and raised its target price to Rs 11,600. This translates to around 15% upside potential. Nomura has maintained a ‘Neutral’ stance on the stock with a target price of Rs 10,928, implying nearly 6% upside from current levels.
| Stock | Brokerage | Rating | Target Price | Upside Potential |
| Hero MotoCorp | Nomura | Neutral | Rs 5,783 | 12% |
| Bajaj Auto | Nomura | Neutral | Rs 10,928 | 6% |
According to the brokerage reports, both companies remain well-placed in the two-wheeler industry, but the growth triggers for each company are very different.
Let’s take a look at what the brokerages are saying about these two auto sector stocks and where they see opportunities ahead.
Nuvama: Hero MotoCorp Vs Bajaj Auto
Nuvama’s outlook on both companies suggest two separate themes. While Hero MotoCorp is seen benefiting from rural recovery, scooters and affordable electric vehicles, Bajaj Auto is being viewed as a stronger export-led play with improving premium bike traction.
Nuvama on Hero MotoCorp: Rural demand, scooters and EV push in focus
According to the Nuvama report, Hero MotoCorp’s Q4FY26 performance remained strong. This is supported by volume growth and better product mix.
Nuvama stated, “Hero MotoCorp’s Q4FY26 revenue/EBITDA surged 29%/31% YoY.” This translates to revenue of nearly Rs 12,800 crore and Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) of around Rs 1,860 crore.
The brokerage believes Hero MotoCorp is gradually strengthening its presence beyond commuter motorcycles.
As per the report, recent launches under Xpulse, Xtreme, Xoom, Destini, Glamour and Vida brands are helping the company expand into premium motorcycles, scooters and electric vehicles.
Nuvama added, “We reckon a core EPS CAGR of 5% over FY26–28E with healthy FCF.” This means the brokerage expects stable earnings growth along with annual free cash flow generation of around Rs 4,100 crore.
The report further highlighted that the company’s affordable electric vehicle strategy could support market share gains. According to the brokerage house report, the “Battery-as-a-Service (BaaS) offering is helping gain further uptake by lowering the upfront cost of E-2Ws.”
Nuvama on Bajaj Auto: Exports and premium bikes drive growth hopes
For Bajaj Auto, Nuvama sees stronger earnings growth ahead driven by exports and premium motorcycles.
The brokerage said that the company’s Q4 EBITDA rose 36% year-on-year to Rs 3,320 crore.
According to the brokerage report, Bajaj Auto is expected to benefit from new launches under Pulsar, KTM and Triumph brands along with rising exports.
Nuvama further stated, “We forecast a 10% volume CAGR over FY26–28E led by 8%/12% growth in domestic/export segments.”
The report also highlighted growth opportunities in the three-wheeler and electric vehicle segments. Bajaj Auto recently entered the electric rickshaw segment, which according to the brokerage could gradually support future volumes as the company expands into more cities.
Bajaj Auto Vs Hero MotoCorp: Nomura view
Nomura has maintained a cautious stance on both stocks, largely due to concerns around margins, commodity prices and the impact of global uncertainties.
Nomura on Hero MotoCorp: Growth visible, but margin risks remain
The brokerage house Nomura in its report noted that Hero MotoCorp’s export business and scooter segment continue to improve steadily.
Nomura stated, “We estimate Hero MotorCorp’s volumes will grow by 6%/5% in FY27/28F, driven by 20%/10% growth in exports.”
However, the brokerage also flagged concerns around profitability pressures and sensitivity to rising fuel prices.
The report noted, “Hero MotoCorp could be impacted more than peers if the war prolongs as it has high exposure to price-sensitive customers in the 100cc segment.”
Nomura has reduced its EBITDA margin estimates and target multiple due to concerns around inflation, commodity costs and global geopolitical risks.
Nomura on Bajaj Auto: Export momentum remains the key trigger
On Bajaj Auto, Nomura remains relatively more constructive due to strong export trends.
The brokerage said, “We raise export volume estimates by 4% for FY27F/28F given strong momentum.”
According to the report, Bajaj Auto’s growth in FY27 could be supported by the Chetak electric scooter and upcoming motorcycle launches.
Nomura also highlighted that exports across Latin America, Asia and Africa continue to remain healthy. However, it cautioned that near-term margins may see some pressure due to commodity costs and the gradual end of Production Linked Incentive (PLI) benefits.
Bajaj Auto Vs Hero MotoCorp: What do brokerages prefer?
Both brokerage houses agree that the two-wheeler sector continues to have multiple growth levers ranging from exports and rural recovery to electric vehicles and premium motorcycles.
| Company | Brands/Segments Highlighted |
| Hero MotoCorp | Xpulse, Xtreme, Xoom, Destini, Glamour, Vida |
| Bajaj Auto | Pulsar, KTM, Triumph, Chetak |
Nuvama appears more optimistic on both companies, especially about Bajaj Auto’s export-led growth and Hero MotoCorp’s improving electric vehicle strategy. Nomura, on the other side, remains cautious on margin pressures and global uncertainties but still sees stable long-term demand trends.
Disclaimer: The investment outlooks and price targets provided by Nuvama and Nomura are for informational purposes only and do not constitute a solicitation to buy or sell any securities. Stocks in the automotive sector are subject to market volatility, shifting rural demand, and fluctuating commodity prices; readers should consult a SEBI-registered investment advisor before making any financial decisions.
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