Hero MotoCorp, India's premier two-wheeler manufacturer, has announced its highest-ever quarterly revenue for the October-December period of financial year 2026, marking a significant milestone in the automotive sector. The company's impressive performance is largely attributed to reduced goods and services tax (GST) rates and robust festive season demand, which collectively spurred consumer spending.
Record-Breaking Financial Performance
In the third quarter of FY26, Hero MotoCorp reported a substantial 21% year-on-year increase in revenue, reaching ₹12,784 crore. Concurrently, the company's profit rose by 15% to ₹1,275 crore. Excluding a one-time impact of ₹119 crore from new labour codes, the net profit stood at an all-time high of ₹1,439 crore. This financial upswing was primarily driven by a 16% surge in sales volume, which totaled 1.69 million units during the quarter.
GST Cuts and Rural Demand Revival
The implementation of GST 2.0 cuts in late September played a pivotal role in boosting demand, particularly in rural markets. Vivek Anand, Chief Financial Officer at Hero MotoCorp, emphasized that conducive macroeconomic factors and favourable GST tailwinds facilitated the revival of rural demand, thereby enhancing consumer traction for motorcycles and contributing to overall economic growth.
Industry-Wide Record Achievements
Hero MotoCorp is not alone in its record-setting performance. TVS Motor Company Ltd and Bajaj Auto Ltd also reported their highest-ever quarterly revenues and profits during the same period. TVS Motor, based in Hosur, witnessed a 46% year-on-year jump in consolidated net profit to ₹891 crore, with revenue growing 33% to ₹14,745 crore. Pune-based Bajaj Auto posted a 25% increase in consolidated net profit to ₹2,749 crore, alongside a 23% revenue rise to ₹16,640 crore.
Export Growth and Market Outlook
All three two-wheeler giants experienced strong export growth in the October-December quarter. Hero MotoCorp saw a 41% rise in export volumes, TVS Motor recorded a 35% jump, and Bajaj Auto achieved a 14% growth. This export momentum, coupled with sustained domestic demand, has bolstered investor confidence. Since the start of the festive season in October, shares of Hero, TVS, and Bajaj Auto have risen by 6%, 7%, and 12%, respectively, outperforming the Nifty Auto index, which increased by 3%.
Sustained Industry Momentum
According to data from the Society of Indian Automobile Manufacturers (SIAM), two-wheeler sales surged 17% to 5.7 million units during October-December, the highest-ever for the quarter. Industry leaders remain optimistic about continued growth. K.N. Radhakrishnan, Director and CEO of TVS Motor, expressed confidence that the company would outperform industry growth in the fourth quarter. Similarly, Rakesh Sharma, Executive Director of Bajaj Auto, highlighted improved growth quality, with customers upgrading to higher-end segments, which aligns well with Bajaj's portfolio strategy.
Analyst Perspectives and Future Projections
Analysts at Kotak Institutional Equities noted in a recent report that retail trends remained strong across most segments, indicating sustained momentum post-festive season. The export segment continued to show robust traction across commercial vehicles, tractors, and two-wheelers, with most original equipment manufacturers (OEMs) reporting numbers ahead of expectations. Sharma added that as long as inflation rates remain under control, the industry's positive momentum is likely to persist, further solidifying the bullish outlook for the two-wheeler sector in the coming months.
