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New Delhi: Hero MotoCorp, India’s largest two-wheeler maker, has set sights on an accelerated product plan for its electric vehicle (EV) business under the Vida brand. The company aims to develop a new range of EVs in the next 18-20 months to expand its portfolio and cater to different segments of the electric two-wheeler market, including more affordable or “mainstream" products, Swadesh Srivastava, Head of the Emerging Mobility Business Unit said in a post-earnings call with analysts on Wednesday.

He said the company began customer deliveries of the Vida scooters in December in three cities, and has so far delivered over 250 scooters.

Meanwhile, Hero MotoCorp posted a net profit of 711 crore in the December quarter, a 3.6% rise from 686 crore a year earlier. Revenue from operations rose 1.8% to 8,031 crore from 7,883 crore. Gross margins at 30.6% expanded 250bps sequentially to a record 19,600 per vehicle. This was helped by periodic price hikes, cost saving programme and softer commodity prices.

However, higher discounts during the festive season and increased spending on the Emerging Mobility Business Unit, marked by expansion of the EV business hit net margins.

Margins are likely to improve in the coming quarters with stable inflation and with EV scooters starting to contribute to revenue, said Niranjan Gupta, chief financial officer.

“We are reinvesting our margins in the internal combustion engine business into building the EV category," Gupta said.

He said over the next two years, the industry’s low gross margins, which are close to being negative, will improve with scale for the industry and for the company.

Hero MotoCorp’s focus is currently on expanding the Vida footprint to more cities, with plans for multiple city rollouts in the next few quarters. Vida scooters are currently available in Delhi, Bengaluru, and Jaipur, and it has a large orderbook, Srivasatva said, without elaborating.

The company plans to launch the scooters in a few more cities this quarter, followed by a nationwide launch. Hero MotoCorp launched the Vida V1 Pro & Plus in October, with an ex-showroom price of 159,000 and 145,000 respectively, making it one of the more expensive electric scooters sold currently in the domestic market. The Bajaj Chetak sells for 151,958, but the company is looking to launch a reconfigured version of the scooter at a lower price point helped by R&D efforts and supply chain ramp-up. Ather Energy’s 450 Plus is offered at a price of 117, 495 ex-showroom in Delhi, and Ola Electric’s S1 at 99,999, while the S1 Pro costs 129,999.

TVS Motor Company, which is significantly ramping up production of its iQube electric scooter with an aim to double volumes every quarter, is priced at 93,056.

ABOUT THE AUTHOR
Alisha Sachdev
Alisha Sachdev is an assistant editor with Mint based in Delhi. She reports on the auto and mobility sector, with a special focus on emerging clean mobility technologies. She also focusses on developing multimedia properties for Mint and currently hosts the 'In A Minute' series and the Mint Primer podcast. Previously, she has worked with CNBC-TV18 and NDTV.
Catch all the Auto News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
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