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Hero MotoCorp Ltd

BSE Code : 500182 | NSE Symbol : HEROMOTOCO | ISIN:INE158A01026| SECTOR : Automobile |

NSE BSE
 
SMC down arrow

2,739.40

-45.60 (-1.64%) Volume 142398

27-Jan-2023 09:59:58

Prev. Close

2,785.00

Open Price

2,788.00

Bid Price (QTY)

2,739.40(5)

Offer Price (QTY)

2,740.85(70)

 

Today’s High/Low 2,810.10 - 2,733.75

52 wk High/Low 2,938.60 - 2,146.85

Key Stats

MARKET CAP (RS CR) 55652.78
P/E 20.97
BOOK VALUE (RS) 822.3059841
DIV (%) 4750
MARKET LOT 1
EPS (TTM) 132.8
PRICE/BOOK 3.38681713845015
DIV YIELD.(%) 3.41
FACE VALUE (RS) 2
DELIVERABLES (%) 42.92
4

News & Announcements

25-Jan-2023

Hero MotoCorp commences deliveries of Vida V1 scooter

24-Jan-2023

Hero MotoCorp Ltd - Hero MotoCorp Limited - Analysts/Institutional Investor Meet/Con. Call Updates

23-Jan-2023

Hero MotoCorp Ltd - Announcement under Regulation 30 (LODR)-Analyst / Investor Meet - Intimation

23-Jan-2023

Hero MotoCorp Ltd - Hero MotoCorp Limited - Analysts/Institutional Investor Meet/Con. Call Updates

25-Jan-2023

Hero MotoCorp commences deliveries of Vida V1 scooter

19-Jan-2023

Hero MotoCorp to declare Quarterly Result

02-Jan-2023

Hero MotoCorp records 8% growth in sales till date in FY23

20-Dec-2022

Hero MotoCorp launches all-new XPulse 200T 4Valve

Corporate Actions

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Peers Comparsion

Select Company Name BSE Code NSE Symbol
Eicher Motors Ltd 505200 EICHERMOT
TVS Motor Company Ltd 532343 TVSMOTOR
TVS Suzuki Ltd (Merged) 500424 TVSSUZUKI
Wardwizard Innovations & Mobility Ltd 538970
Wardwizard Innovations & Mobility Ltd PartlyPaidup 890164

Share Holding

Category No. of shares Percentage
Total Foreign 55653513 27.85
Total Institutions 54543547 27.30
Total Govt Holding 0 0.00
Total Non Promoter Corporate Holding 1586162 0.79
Total Promoters 69488181 34.77
Total Public & others 18559030 9.30
Total 199830433 100
  • Total Foreign
  • Total Institutions
  • Total Govt Holding
  • Total Non Promoter Corporate Holding
  • Total Promoters
  • Total Public & others

About Hero MotoCorp Ltd

Hero MotoCorp Limited is the world's largest manufacturer of two wheelers'. The Company has four manufacturing facilities namely Dharuhera and Gurgaon in Haryana, Haridwar in Uttarakhand and Neemrana in Rajasthan. The Company is based at New Delhi, India. The Company offers a range of bikes starting from CD Dawn, CD Deluxe, Splendor Plus, Splendor NXG, Passion and Passion Pro. The 125 cubic centimeter segment offers Glamour, Super Splendor and Glamour F1. It also has an offering called Achiever in 135 cubic centimeter segment. In the 150 cubic centimeter and above the company offers brands like Hunk, CBZ X-treme, Karizma and the Karizma ZMR. It also offers a 100 cubic centimeter scooter, Pleasure. Hero MotoCorp Limited was incorporated in January 19th, 1984 under the name 'Hero Honda Motors Ltd.' The Company was established as a Joint Venture Company between Honda Motor Company of Japan and Hero Group. In year 1983, they signed a Joint Collaboration Agreement and formed the Company. The joint venture between India's Hero Group and Honda Motor Company, Japan has not only created the world's single largest two wheeler company but also one of the most successful joint ventures worldwide. In the year 1985, the Company commenced their commercial production at Dharuhera plant in Haryana and introduced their first motorcycle, CD 100 in the market. In the year 1989, they launched the new motorcycle model, Sleek in the market and in the year 1991, they introduced new motorcycle model, CD 100 SS in the market. In the year 1995, the company introduced their extraordinary product, Splendor in the market. In the year 1997, the Company inaugurated their second manufacturing facility at Gurgaon in Haryana. Also, they introduced new motorcycle model, Street in the market. In the year 1999, they launched Hero Honda CBZ, the first 150cc motorcycle in the Indian two wheeler industry. In the year 2001, the company introduced new models, Passion and Joy in the market. In the next year, they introduced new models, Dawn and Ambition in the market. In the year 2003, the company launched new motorcycle models namely, CD Dawn, Splendor+ and Passion Plus in the market. Also, they launched Hero Honda Karizma, the industry's first 223cc motorcycle. In the year 2004, they introduced new models, Ambition 135 and CBZ* in the market. During the year, they renewed the joint technical agreement with the Honda Motors Company, Japan. In the year 2005, the company launched Super Splendor, CD Deluxe, Glamour and Achiever in the market. In the year 2006, the company forayed into scotter segment and launched 100cc gearless scotter, Pleasure in the market. In the year 2007, the company launched Splendor NXG, CD Deluxe, Passion Plus and Hunk in the market. During the year 2007-08, the company commissioned their third plant at Haridwar in Uttarakhand with an initial installed capacity of 500,000 units. This plant had lean manufacturing and practices that ensure efficiency. During the year, the company launched new models (including variants) including Splendor NXG, Hunk, New Super Splendor, New Passion Plus, Commemorative Splendor+ and a refreshed version of Pleasure. During the year 2008-09, the company increased the installed capacity of Motorised 2 wheelers upto 350CC engine by 1800000 Nos to 5200000 Nos. Also, they launched eight models: Passion Pro (100 cubic capacity-4 Stroke), CBZ-Extreme (150 cubic capacity - 4 Stroke), Pleasure New Aesthetics, Splendor NXG (Self Start), CD Deluxe (Self Start), Glamour FI, Glamour (Carb) and HUNK Special Edition. Also, they launched new motorcycle model, Karizma - ZMR in the market. During the year 2009-10, the company increased the installed capacity of Motorised 2 wheelers upto 350CC engine by 200000 Nos to 5400000 Nos. The company launched nine new models during the year. During the year 2010-11, the company launched six new models including variants of existing models successfully. They refreshed Glamour and Glamour FI. They introduced the New Hunk, Super Splendor and Splendor Pro. The company launched the new upgraded versions of CBZ Xtreme and Karizma. Also, they breached the landmark 5 million figure cumulative sales in a single year. During the year, the Indian Promoter Group of the company, which comprised of Hero Investments Pvt Ltd (HIPL), Bahadur Chand Investment Pvt Ltd (BCIPL) and Hero Cycles Limited (Hero Cycles) re-aligned the shareholding in the company, following a family agreement. As a result, Hero Cycles transferred its shareholding in the company to HIPL on May 28, 2010. As a result of these transactions, the Indian Promoter Group of the company now comprises of HIPL and BCIPL owned and controlled entirely by the Munjal Family headed by Brijmohan Lall Munjal. Also, during the year, the Indian Promoter Group and Honda Motor Co Ltd, Japan (Honda) entered into a Share Transfer Agreement (the Agreement) on January 22, 2011. As per the terms of the Agreement, Honda had agreed to transfer its entire shareholding of 26% in the Company to the Indian Promoter Group, bringing an end to the joint venture between the two promoter groups of the company. The acquisition was completed on March 22, 2011 and the shares held by Honda were transferred to the Indian joint venture partner. In addition to the Agreement, the Indian Promoter Group and Honda also entered into a License Agreement on January 1, 2011. As per this agreement, Honda has given to the company, the right and license to manufacture, assemble, sell and distribute certain products and their service parts under their Intellectual Property Rights. In July 2011, the company changed their name from Hero Honda Motors Ltd to Hero MotoCorp Ltd. In February 2012, the company entered into a strategic partnership with Erik Buell Racing (EBR) of USA for contemporary technology and design inputs to enable the company to launch high end bikes for the domestic and international markets. In 2013, Hero Motocorp commenced construction of its new plant & Global Parts Centre. The company Commences Construction of Its 'GAME-CHANGING' Centre of Global Innovation And Research & Design. In 2014, Hero Motocorp Heralds A New Era Of Technology Leadership. The company Sets New Benchmark For The Global Two Wheeler Industry. The company Launches Splendor Ismart With Game Changing I3s Technology. The company also rides Into A Greener Tomorrow With 'GARDEN Factory' In 2015, Hero MotoCorp launched a new entry level commuter, the HF Dawn. During the year, the company has been allocated a 592-acre site to facilitate development of its Rs 1600-crore Greenfield manufacturing unit in Andhra Pradesh. HMCL Americas INC enters into 'Settlement Agreement' to Acquire EBR's Consulting Business. The company commences operation in their first ever plant outside India established in Villa Rica, Colombia. On 29 September 2015, Hero MotoCorp launched two scooters under the brands Maestro Edge and Duet. In February 2016, Hero MotoCorp showcased three new bikes Splendor iSmart 110, the Xtreme 200 S, the XF3R and an electric scooter the Duet E at Auto Expo, a trade show in New Delhi. On 10 March 2016, Hero MotoCorp formally inaugurated its world-class Global Centre of Innovation and Technology' (CIT) in Jaipur, Rajasthan. Built with an investment of Rs 850 crore, the CIT will design and develop world-class products for global markets. In April 2016, Hero MotoCorp launched a drive against unscrupulous traders selling counterfeit Hero spare parts. On 14 July 2016, Hero MotoCorp launched the new Splendor iSmart 110, the first motorcycle to be developed completely in-house with Hero's own technology. To commemorate the landmark 70 million in cumulative production of two-wheelers, Hero MotoCorp on 26 September 2016 launched a Limited Edition of a new premium motorcycle Achiever 150. The Board of Directors of Hero MotoCorp at its meeting held on 26 October 2016 approved an investment of up to Rs 205 crore, in one or more tranches, for approximately 26-30% shareholding in Ather Energy Private Limited. Ather is a Bangalore-based technology start-up engaged in the business of designing and manufacturing smart Electric Vehicles (EV) and associated charging infrastructure. On 10 November 2016, Hero MotoCorp unveiled its new Dawn 125 motorcycle at the EICMA Motorcycle show in Milan, Italy. As part of Hero MotoCorp's market-specific product strategy, the Dawn 125 motorcycle has been developed specifically for the Africa region. On 12 January 2017, Hero MotoCorp launched new Glamour motorcycle in Argentina, its first-ever global launch of a new product outside India. On 3 April 2017, Hero MotoCorp announced that the company clocked its highest-ever sales in a financial year at 66,63,903 units in FY 2017 compared to 66,32,322 units it had sold in the previous fiscal (FY 2016). In May 2017, Hero MotoCorp commenced commercial production at the second global manufacturing facility in Bangladesh. On 3 October 2017, Hero MotoCorp announced that it has set a new global benchmark in the two-wheeler industry, surpassing the seven lakh sales mark in any month. Riding on robust demand for its range of two-wheelers, the company registered its highest-ever sales for any month, despatching 720,739 units in September 2017. On 11 October 2017, Hero MotoCorp announced that it has set a new global record, clocking 2 million unit sales in Q2 September 2017. Hero MotoCorp sold 20,22,805 units of two-wheelers in Q2 September 2017, recording 11% growth over the corresponding quarter in the previous fiscal. On 7 November 2017, Hero MotoCorp unveiled the Xpulse Concept motorcycle as a world premier at the EICMA annual trade show in Milan, Italy. On 21 December 2017, Hero MotoCorp unveiled three new motorcycles - the 125cc Super Splendor, the 110cc Passion PRO and the 110cc Passion XPRO - to further augment its dominant leadership in the domestic market. On 22 December 2017, Hero MotoCorp announced that it will be increasing the ex-showroom prices of its motorcycles by about Rs 400 per model with effect from 1 January 2018 to partially off-set rising input costs. Hero MotoCorp surpassed the landmark seven million units in cumulative sales in a calendar year in 2017. The company sold a record 7,207,363 units of two-wheelers in the calendar year in 2017. During FY 2017-18, construction of sixth manufacturing facility at Sricity in Chittoor District in the state of Andhra Pradesh has commenced with a proposed capacity of 1.8 million units per annum. The company will invest Rs 1,600 crore in setting up this manufacturing facility. The plant is expected to be operational in FY 2019-20. During FY 2017-18, the second overseas plant of the company at Jessore in Bangladesh started commercial production during the first quarter. During the year 2017-18,the Company added two markets - Trinidad & Tobago and Guyana - to grow the countries in which HMCL is present in, to 37. As on 31 March 2018,the Company has 6 subsidiaries including step down subsidiaries and 3 associate companies. During FY 2018-19, construction of sixth manufacturing facility at Sricity in Chittoor District in the state of Andhra Pradesh has reached at an advanced stage with an annual installed capacity of 1.8 million units.The Company has invested approx. Rs 650 crore in Phase I out of total projected investment of Rs 1,600 crore in setting up the manufacturing facility. Phase I is expected to be operational by October 2019. Further, the overseas plant of your Company at Jessore in Bangladesh achieved its designed production capacity of 1.5 lakh units during FY 2018-19 and consolidated decent market share. As on 31 March 2019,the Company has 7 subsidiaries including step down subsidiaries and 3 associate companies. During the FY2019,the Company has set up a Tech Center in Germany as its wholly owned subsidiary under the name, Hero Tech Center Germany GmbH. The Company sold over 78.21 lakh vehicles during the financial year 2018-19, the highest by any two-wheeler company in the world. During FY 2019-20, the Company's sixth manufacturing facility in Chittoor District in the state of Andhra Pradesh was commissioned with Phase I installed capacity of 0.4 million units. The total Phase I investment is approximately Rs 700 crore out of total projected investment of Rs 1,600 crore in setting up the manufacturing facility. Transition from BSIV to BSVI emission norms has been successfully accomplished well in time across all platforms in FY 2019-20. As on 31 March 2020, Company has 6 subsidiaries including step down subsidiaries and 2 associate companies and regularly monitors the performance of these companies. During the year, the Company's wholly-owned subsidiary, HMCL (NA) Inc. which had invested in Erik Buell Racing, Inc. was dissolved and thus, Erik Buell Racing, Inc. also ceased to be the associate of the company. In July 2020, the Company invested H 84 crore in Ather Energy, taking up its shareholding in the Company to 34.58%. In November 2020, Company again invested in Series D round in the Electric Vehicle startup. In October 2020, the Company signed a distribution agreement with HarleyDavidson (H-D), under which the Company will sell and service H-D motorcycles, and sell parts and accessories and general merchandise riding gear and apparel in India. The Company has inducted 11 dealers of Harley-Davidson into its own distribution network. Starting 01 January 2021, Hero MotoCorp Ltd. has become the distributor for Harley-Davidson in India. Hero MotoCorp Ltd. and Harley-Davidson also signed a Licensing agreement under which the Company will develop and sell a range of premium motorcycles under the H-D brand name. During the FY2021, the company also entered into a strategic partnership with Gogoror Inc. to accelerate the shift from fuel based mobility to sustainable electric mobility in India. During FY 2020-21, the company entered into Mexico market and the footprint of the company reached 41 markets outside India. On 04 February 2021,the company declared a special dividendof Rs 10 per share to mark the achievement of historic milestone of achieving 100 Million cumulative production of two wheelers. The company proactively paused its operations temporarily during the second wave at all of its manufacturing facilities across the country, including its Global Parts Center (GPC) in Neemrana and its R&D facility - the Centre of Innovation and Technology (CIT), Jaipur due to the Operations escalation of Covid-19 cases across the country. The company gradually resumed its operations from 17 May 2021 by starting single shift production at three of its plants - Gurugram and Dharuhera in Haryana and at Haridwar in the northern hill state of Uttarakhand.The company resumed production at all its manufacturing plants in India from 24 May 2021. During the second quarter of FY2022, Hero MotoCorp achieved two consecutive recognitions from the Guinness World Record for creating the Largest Motorcycle Logo' in August 2021 and for creating the Largest Online Photo Album of People Planting Plants' in September 2021. During the third quarter of FY2022,the company inaugurated a flagship dealership in Dubai to expand presence in the Gulf market to 10 customer touchpoints in 5 countries.Also Partnered with Gilera Motors in Argentina to expand Hero's presence in the country - inaugurated a flagship dealership in Buenos Aires under the partnership. The Company has 6 subsidiaries including step down subsidiaries and 2 associate companies as on March 31, 2022. During FY 2021-22, the Company commenced retail sales in Mexico and introduced an extensive portfolio of products. It relaunched the Hero brand in markets like Argentina, Kenya, Honduras and Nicaragua. It strengthened presence in Gulf region, expanding network of touchpoints, including dealerships, service centres and spare parts outlets; it entered into another exclusive dealership in Dubai. It reinvigorated strategy for the Nigerian market, leading to a 978% dispatch growth. It also launched a new motorcycle, Hunter,' developed especially for the market. In March 2022, Company launched a new brand Vida'-Powered by Hero, an in-house electric vehicle brand. It forayed into the pre-owned two-wheeler business under the brand Hero Sure - Powered by Wheels of Trust'. It expanded the network by adding super stockists, authorized representatives of dealers, Hero Sure network and HGPD. It launched Xpulse 200 4V in October, 2021. It launched the new Stealth variant, Xtreme 160R, a fast-pick up bike. During the year 2022, 45 new outlets were added, which increased their footprint to 43 markets outside India. It launched the official Hero merchandise business in August, 2021.

Hero MotoCorp Ltd Chairman Speech

CELEBRATING A GLORIOUS JOURNEY

Dear Shareholders,

I hope you and all your loved ones are keeping well and staying safe.

The year under review has been about change, resilience, about resetting priorities and the drive towards the achievement of our dreams. This is true not just for Hero MotoCorp; this is also the story for most of humankind since the Coronavirus pandemic manifested itself in 2020.

Navigating a difficult environment and the unforeseeable circumstances during the more intense second wave of the pandemic, Hero MotoCorp proved its resilience with prudent leadership and the tremendous hard work of our colleagues through FY 2021-22.

As I sit down to write my annual message, a lot is going through my mind. The foremost being – is there a global debt crisis looming on the horizon? The global markets seem to be in a free fall. Asian markets have lost upwards of $2 trillion in the past four months, primarily as a consequence of rolling lockdowns in various parts of the world. The Indian rupee has hit an all-time low against the US dollar. With no sign of an early end to the war in Ukraine, it is quite likely that the conflict will tip the already fragile global economy into a slump.

While Hero MotoCorp also faced multiple headwinds during this trying year, the Company maintained its global leadership position. With the customer?s needs at the centre of our mission, Hero MotoCorp continued to offer the best products and services. In line with the Company?s Mission Statement to ‘Create, Collaborate and Inspire?, we are leading the world into a sustainable future! The best ideas often come to fruition when different partners collaborate and work together. Collaboration is what defines Brand Hero. As the Japanese author, Ryunosuke Satoro wrote, "Individually, we are one drop. Together, we are an ocean."

Adapting to the constantly changing conditions, transforming our methods as well as processes and working together relentlessly have resulted in our success and continuous growth during this period. This hard work and tenacity has enabled Hero MotoCorp to continue to retain its coveted position as the world?s no. 1 two-wheeler company for more than two decades.

Hero MotoCorp is not only a proud contributor to India?s great economy, but also the harbinger of the nation?s ingenuity and manufacturing prowess and a major contributor towards its position in the global economic and geopolitical space. During the past decade of our Corporate journey, we have expanded our global footprint to 40+ countries; doubled our manufacturing base to eight plants, including one each in Colombia and Bangladesh; scaled up our in-house research and development capabilities with a world-class R&D ecosystem in India and Germany and, above all, we have built an organisation on the pillars of diversity and inclusion (D&I). With women workers comprising almost 10% of our workforce and associates from over a dozen countries around the world, we are spearheading the industry in inculcating D&I in the organisational culture.

An Electrifying Future

Mobility is undergoing one of the most transformational shifts of the century, with far-reaching implications such as shifting consumer demands, ownership, and breakthrough technologies. With a move towards electric drive-trains and Government regulation, mobility of the next decade will look dramatically different than it does today.

We believe that this transformational shift will be marked by rapid strides in intelligent mobility that will be governed by big data, machine learning and artificial intelligence (AI). The vehicles of tomorrow will not just take you from Point A to Point B in a sustainable manner; they will also be smart, intuitive and intelligent. Hero MotoCorp will be right at the forefront of this transformation, fully in keeping with our Vision – Be the Future of Mobility.

This year will see Hero MotoCorp claim its position in the exciting clean mobility space in a bold avatar. Hero MotoCorp will transform its leadership in the internal combustion engine (ICE) market into the electric vehicle space – globally!

In keeping with our vision to lead the migration to this new future of mobility, we have unveiled Vida - Powered by Hero – as our new brand identity for emerging mobility solutions. Through Vida, which means ‘life?, we will not only revolutionise the electric mobility space, but will also ensure a cleaner, greener and better future for generations to come.

At Hero MotoCorp, we continue to leverage our partnerships to strengthen our capabilities. With our partnership with Gogoro Inc. of Taiwan, we will bring the largest battery-swapping network to India. We are also in discussions with Bharat Petroleum Corporation Limited to set up battery charging infrastructure for EVs across the country. With the investment in Ather Energy, starting from 2016, Hero MotoCorp is also accelerating its electric journey and bringing sustainable mobility solutions that deliver value to our stakeholders.

Riding into New Markets

In keeping with our strategy of strengthening our core business and amid the transformation of the automotive industry, we aim to capitalise on all the opportunities presented by the global automotive and emerging markets.

Hero MotoCorp?s new strategy for its Global Business (GB), called ‘R4? which was launched in 2021, has been transformative and has delivered great results. The R4 mission was to Recalibrate, Revitalise, Revolutionise and Revive our Global Business. This programme has been a strong success and our Global Business delivered 300,624 two-wheelers in 43 markets during the year under review. This was a remarkable growth of 57% compared to total units sold in the previous year.

During FY 2021-22, we significantly expanded our presence in the Central and South American markets through strategic partnerships. Having already commenced retail sales in Mexico, in partnership with Grupo Salinas, we aim to become a key player in that market. We have partnered with Gilera Motors in Argentina, which is one of the leading automotive companies in the country. Our new partnerships in Central America with Grupo Casa Pellas in Nicaragua and Movesa S.S. in Honduras are also extremely promising and should deliver results.

We further expanded our presence in El Salvador and reinvigorated our strategy in Nigeria, with a goal to attain market leadership in the African markets. Our new dealership in Dubai will help us tap into the growing market in the Gulf region. Our aim is to reach out to the youth, 2021 was a transformative year for the Company under its R4 strategy. We are clearly on our way to Recalibrate, Revitalise, Revolutionise, Revive our Global Business.

cater to their aspirations and provide our customers an enhanced riding experience through our flagship stores and experience centres. The goal is to garner 15% of our total volumes from global markets by 2025.

Sustained Growth Despite Continued Headwinds

During the year under review, the two-wheeler industry faced multiple headwinds, owing to weak demand and continuous challenges in the supply chain. The rural markets, which account for over half the annual sales of motorcycles and scooters in India, remained under economic stress. Higher material costs, shortages of products and services and soaring fuel prices increased the cost of ownership, further dampening consumer sentiment and their ability to buy.

All of these events impacted two-wheeler sales in India. To offset the adverse impact, we focused on expanding our exports, optimising costs, prioritising projects, improving internal processes and re-evaluating options. While the rising costs for freight played spoilsport, we navigated through these challenges with grit, endurance and determination to ensure that our products reached our distributors and customers.

During this challenging year, we continued to focus on the short- and medium-term growth drivers for the Company. Together, with the move towards premiumisation of our product portfolio and the focus on growing our Parts Accessories and Merchandise (PAM) business, we achieved both growth and profitability. The PAM business recorded a growth of 15% YoY, and revenue creation of over Rs1,000 crore per quarter. The PAM segment?s contribution has been noteworthy and it continues to grow at a healthy rate.

Another key enabler for this fiscal year was Hero FinCorp, our finance arm, which has been growing at a phenomenal pace since 2012. It has helped serve seven million customers through its 2,000 locations spread across the country. Hero FinCorp recently raised Rs2,000 crore in growth capital, which will help it expand its reach and offering and drive two-wheeler sales. Hero FinCorp plans to evolve into a full-service finance company in the near future.

Digital platforms and cybernetic assistants are increasingly becoming an essential part of our work and daily lives. Our investments in the rapid modernisation and digitalisation of processes shows that we are precisely on the right track. The launch of our virtual showroom, providing our customers with an immersive buying experience, is among one of the several digital initiatives that have helped us drive process optimisation.

Hero MotoCorp has also launched a sales and aftersales services platform on WhatsApp. Going forward, we expect 30% of our sales to be generated from digital channels. Additionally, we have launched 7 new ‘PHYGITAL Hero 2.0? stores across the country.

These new stores offer a warm and inviting environment for our consumers, with a High Digital Engagement Infrastructure. I dare say, these stores are a beacon of reference for the entire two-wheeler industry. In the year ahead, we plan to re-energise our dealership network across the country by opening a large number of these stores.

Diversity & Inclusion – The Ethos of Our Organisation

Hero MotoCorp sees diversity and inclusion (D&I) as its strength. A diverse workforce brings with it different perspectives, experiences and competencies – and thus makes us more innovative, inclusive and competitive. For this reason, we encourage a work environment that actively incorporates different ideas, perspectives and leadership styles.

We embrace diversity in all its facets and team Hero MotoCorp is constantly striving to increase the number of women in the organisation, across the entire spectrum — from the shop floor to the Board room. I am personally driving the D&I agenda, with a stated mandate to all the leaders to replicate this concept in all of their respective functions.

Sustained Focus on ESG

Our ‘people first? strategy is inseparable from our future plans which are tied to our focus on sustainability, responsible manufacturing and doing business the right way. Through the five pillars of People, Product Stewardship, Inclusive Growth, Eco-efficiency and Responsible Value Chain, we are evaluating every decision through the ESG lens. Our consistent efforts in stewarding sustainability have also been recognised by the Emerging Markets Dow Jones Sustainability Index for two consecutive years.

As a worldwide sustainability leader, we have initiated a major step during the year with the institution of a $100 million Global Sustainability Fund. The fund will be used to nurture 10,000+ entrepreneurs on ESG solutions that will in turn, create a positive impact on the planet.

Riding Towards New Horizons

Hero MotoCorp is geared up for the next decade and the next horizon. As we have our eyes on the production of the next 100 million by the end of 2030, we are taking strides towards sustainability and electrification with a single-minded determination to Be the Future of Mobility.

All I can promise is that, while the first 100 million was achieved with the production of motorcycles and scooters, the next 100 would certainly be an all-new, innovative and greener body form.

I am confident that our leadership team and the entire Hero family, with their courage, confidence and dedication, will write the next chapter of the Company?s unique success story.

Together, we will make a difference in the future.

On behalf of team Hero MotoCorp, I thank our valued shareholders, dealers, distributors, supply chain partners, associates, our entire workforce, our customers in India and across the world, for their unstinted support and faith in our Company, our people, as well as our products.

I wish everyone a healthy, safe and prosperous FY 2022-23.

Dr. Pawan Munjal
Chairman & CEO, Hero MotoCorp

   

Hero MotoCorp Ltd Company History

Hero MotoCorp Limited is the world's largest manufacturer of two wheelers'. The Company has four manufacturing facilities namely Dharuhera and Gurgaon in Haryana, Haridwar in Uttarakhand and Neemrana in Rajasthan. The Company is based at New Delhi, India. The Company offers a range of bikes starting from CD Dawn, CD Deluxe, Splendor Plus, Splendor NXG, Passion and Passion Pro. The 125 cubic centimeter segment offers Glamour, Super Splendor and Glamour F1. It also has an offering called Achiever in 135 cubic centimeter segment. In the 150 cubic centimeter and above the company offers brands like Hunk, CBZ X-treme, Karizma and the Karizma ZMR. It also offers a 100 cubic centimeter scooter, Pleasure. Hero MotoCorp Limited was incorporated in January 19th, 1984 under the name 'Hero Honda Motors Ltd.' The Company was established as a Joint Venture Company between Honda Motor Company of Japan and Hero Group. In year 1983, they signed a Joint Collaboration Agreement and formed the Company. The joint venture between India's Hero Group and Honda Motor Company, Japan has not only created the world's single largest two wheeler company but also one of the most successful joint ventures worldwide. In the year 1985, the Company commenced their commercial production at Dharuhera plant in Haryana and introduced their first motorcycle, CD 100 in the market. In the year 1989, they launched the new motorcycle model, Sleek in the market and in the year 1991, they introduced new motorcycle model, CD 100 SS in the market. In the year 1995, the company introduced their extraordinary product, Splendor in the market. In the year 1997, the Company inaugurated their second manufacturing facility at Gurgaon in Haryana. Also, they introduced new motorcycle model, Street in the market. In the year 1999, they launched Hero Honda CBZ, the first 150cc motorcycle in the Indian two wheeler industry. In the year 2001, the company introduced new models, Passion and Joy in the market. In the next year, they introduced new models, Dawn and Ambition in the market. In the year 2003, the company launched new motorcycle models namely, CD Dawn, Splendor+ and Passion Plus in the market. Also, they launched Hero Honda Karizma, the industry's first 223cc motorcycle. In the year 2004, they introduced new models, Ambition 135 and CBZ* in the market. During the year, they renewed the joint technical agreement with the Honda Motors Company, Japan. In the year 2005, the company launched Super Splendor, CD Deluxe, Glamour and Achiever in the market. In the year 2006, the company forayed into scotter segment and launched 100cc gearless scotter, Pleasure in the market. In the year 2007, the company launched Splendor NXG, CD Deluxe, Passion Plus and Hunk in the market. During the year 2007-08, the company commissioned their third plant at Haridwar in Uttarakhand with an initial installed capacity of 500,000 units. This plant had lean manufacturing and practices that ensure efficiency. During the year, the company launched new models (including variants) including Splendor NXG, Hunk, New Super Splendor, New Passion Plus, Commemorative Splendor+ and a refreshed version of Pleasure. During the year 2008-09, the company increased the installed capacity of Motorised 2 wheelers upto 350CC engine by 1800000 Nos to 5200000 Nos. Also, they launched eight models: Passion Pro (100 cubic capacity-4 Stroke), CBZ-Extreme (150 cubic capacity - 4 Stroke), Pleasure New Aesthetics, Splendor NXG (Self Start), CD Deluxe (Self Start), Glamour FI, Glamour (Carb) and HUNK Special Edition. Also, they launched new motorcycle model, Karizma - ZMR in the market. During the year 2009-10, the company increased the installed capacity of Motorised 2 wheelers upto 350CC engine by 200000 Nos to 5400000 Nos. The company launched nine new models during the year. During the year 2010-11, the company launched six new models including variants of existing models successfully. They refreshed Glamour and Glamour FI. They introduced the New Hunk, Super Splendor and Splendor Pro. The company launched the new upgraded versions of CBZ Xtreme and Karizma. Also, they breached the landmark 5 million figure cumulative sales in a single year. During the year, the Indian Promoter Group of the company, which comprised of Hero Investments Pvt Ltd (HIPL), Bahadur Chand Investment Pvt Ltd (BCIPL) and Hero Cycles Limited (Hero Cycles) re-aligned the shareholding in the company, following a family agreement. As a result, Hero Cycles transferred its shareholding in the company to HIPL on May 28, 2010. As a result of these transactions, the Indian Promoter Group of the company now comprises of HIPL and BCIPL owned and controlled entirely by the Munjal Family headed by Brijmohan Lall Munjal. Also, during the year, the Indian Promoter Group and Honda Motor Co Ltd, Japan (Honda) entered into a Share Transfer Agreement (the Agreement) on January 22, 2011. As per the terms of the Agreement, Honda had agreed to transfer its entire shareholding of 26% in the Company to the Indian Promoter Group, bringing an end to the joint venture between the two promoter groups of the company. The acquisition was completed on March 22, 2011 and the shares held by Honda were transferred to the Indian joint venture partner. In addition to the Agreement, the Indian Promoter Group and Honda also entered into a License Agreement on January 1, 2011. As per this agreement, Honda has given to the company, the right and license to manufacture, assemble, sell and distribute certain products and their service parts under their Intellectual Property Rights. In July 2011, the company changed their name from Hero Honda Motors Ltd to Hero MotoCorp Ltd. In February 2012, the company entered into a strategic partnership with Erik Buell Racing (EBR) of USA for contemporary technology and design inputs to enable the company to launch high end bikes for the domestic and international markets. In 2013, Hero Motocorp commenced construction of its new plant & Global Parts Centre. The company Commences Construction of Its 'GAME-CHANGING' Centre of Global Innovation And Research & Design. In 2014, Hero Motocorp Heralds A New Era Of Technology Leadership. The company Sets New Benchmark For The Global Two Wheeler Industry. The company Launches Splendor Ismart With Game Changing I3s Technology. The company also rides Into A Greener Tomorrow With 'GARDEN Factory' In 2015, Hero MotoCorp launched a new entry level commuter, the HF Dawn. During the year, the company has been allocated a 592-acre site to facilitate development of its Rs 1600-crore Greenfield manufacturing unit in Andhra Pradesh. HMCL Americas INC enters into 'Settlement Agreement' to Acquire EBR's Consulting Business. The company commences operation in their first ever plant outside India established in Villa Rica, Colombia. On 29 September 2015, Hero MotoCorp launched two scooters under the brands Maestro Edge and Duet. In February 2016, Hero MotoCorp showcased three new bikes Splendor iSmart 110, the Xtreme 200 S, the XF3R and an electric scooter the Duet E at Auto Expo, a trade show in New Delhi. On 10 March 2016, Hero MotoCorp formally inaugurated its world-class Global Centre of Innovation and Technology' (CIT) in Jaipur, Rajasthan. Built with an investment of Rs 850 crore, the CIT will design and develop world-class products for global markets. In April 2016, Hero MotoCorp launched a drive against unscrupulous traders selling counterfeit Hero spare parts. On 14 July 2016, Hero MotoCorp launched the new Splendor iSmart 110, the first motorcycle to be developed completely in-house with Hero's own technology. To commemorate the landmark 70 million in cumulative production of two-wheelers, Hero MotoCorp on 26 September 2016 launched a Limited Edition of a new premium motorcycle Achiever 150. The Board of Directors of Hero MotoCorp at its meeting held on 26 October 2016 approved an investment of up to Rs 205 crore, in one or more tranches, for approximately 26-30% shareholding in Ather Energy Private Limited. Ather is a Bangalore-based technology start-up engaged in the business of designing and manufacturing smart Electric Vehicles (EV) and associated charging infrastructure. On 10 November 2016, Hero MotoCorp unveiled its new Dawn 125 motorcycle at the EICMA Motorcycle show in Milan, Italy. As part of Hero MotoCorp's market-specific product strategy, the Dawn 125 motorcycle has been developed specifically for the Africa region. On 12 January 2017, Hero MotoCorp launched new Glamour motorcycle in Argentina, its first-ever global launch of a new product outside India. On 3 April 2017, Hero MotoCorp announced that the company clocked its highest-ever sales in a financial year at 66,63,903 units in FY 2017 compared to 66,32,322 units it had sold in the previous fiscal (FY 2016). In May 2017, Hero MotoCorp commenced commercial production at the second global manufacturing facility in Bangladesh. On 3 October 2017, Hero MotoCorp announced that it has set a new global benchmark in the two-wheeler industry, surpassing the seven lakh sales mark in any month. Riding on robust demand for its range of two-wheelers, the company registered its highest-ever sales for any month, despatching 720,739 units in September 2017. On 11 October 2017, Hero MotoCorp announced that it has set a new global record, clocking 2 million unit sales in Q2 September 2017. Hero MotoCorp sold 20,22,805 units of two-wheelers in Q2 September 2017, recording 11% growth over the corresponding quarter in the previous fiscal. On 7 November 2017, Hero MotoCorp unveiled the Xpulse Concept motorcycle as a world premier at the EICMA annual trade show in Milan, Italy. On 21 December 2017, Hero MotoCorp unveiled three new motorcycles - the 125cc Super Splendor, the 110cc Passion PRO and the 110cc Passion XPRO - to further augment its dominant leadership in the domestic market. On 22 December 2017, Hero MotoCorp announced that it will be increasing the ex-showroom prices of its motorcycles by about Rs 400 per model with effect from 1 January 2018 to partially off-set rising input costs. Hero MotoCorp surpassed the landmark seven million units in cumulative sales in a calendar year in 2017. The company sold a record 7,207,363 units of two-wheelers in the calendar year in 2017. During FY 2017-18, construction of sixth manufacturing facility at Sricity in Chittoor District in the state of Andhra Pradesh has commenced with a proposed capacity of 1.8 million units per annum. The company will invest Rs 1,600 crore in setting up this manufacturing facility. The plant is expected to be operational in FY 2019-20. During FY 2017-18, the second overseas plant of the company at Jessore in Bangladesh started commercial production during the first quarter. During the year 2017-18,the Company added two markets - Trinidad & Tobago and Guyana - to grow the countries in which HMCL is present in, to 37. As on 31 March 2018,the Company has 6 subsidiaries including step down subsidiaries and 3 associate companies. During FY 2018-19, construction of sixth manufacturing facility at Sricity in Chittoor District in the state of Andhra Pradesh has reached at an advanced stage with an annual installed capacity of 1.8 million units.The Company has invested approx. Rs 650 crore in Phase I out of total projected investment of Rs 1,600 crore in setting up the manufacturing facility. Phase I is expected to be operational by October 2019. Further, the overseas plant of your Company at Jessore in Bangladesh achieved its designed production capacity of 1.5 lakh units during FY 2018-19 and consolidated decent market share. As on 31 March 2019,the Company has 7 subsidiaries including step down subsidiaries and 3 associate companies. During the FY2019,the Company has set up a Tech Center in Germany as its wholly owned subsidiary under the name, Hero Tech Center Germany GmbH. The Company sold over 78.21 lakh vehicles during the financial year 2018-19, the highest by any two-wheeler company in the world. During FY 2019-20, the Company's sixth manufacturing facility in Chittoor District in the state of Andhra Pradesh was commissioned with Phase I installed capacity of 0.4 million units. The total Phase I investment is approximately Rs 700 crore out of total projected investment of Rs 1,600 crore in setting up the manufacturing facility. Transition from BSIV to BSVI emission norms has been successfully accomplished well in time across all platforms in FY 2019-20. As on 31 March 2020, Company has 6 subsidiaries including step down subsidiaries and 2 associate companies and regularly monitors the performance of these companies. During the year, the Company's wholly-owned subsidiary, HMCL (NA) Inc. which had invested in Erik Buell Racing, Inc. was dissolved and thus, Erik Buell Racing, Inc. also ceased to be the associate of the company. In July 2020, the Company invested H 84 crore in Ather Energy, taking up its shareholding in the Company to 34.58%. In November 2020, Company again invested in Series D round in the Electric Vehicle startup. In October 2020, the Company signed a distribution agreement with HarleyDavidson (H-D), under which the Company will sell and service H-D motorcycles, and sell parts and accessories and general merchandise riding gear and apparel in India. The Company has inducted 11 dealers of Harley-Davidson into its own distribution network. Starting 01 January 2021, Hero MotoCorp Ltd. has become the distributor for Harley-Davidson in India. Hero MotoCorp Ltd. and Harley-Davidson also signed a Licensing agreement under which the Company will develop and sell a range of premium motorcycles under the H-D brand name. During the FY2021, the company also entered into a strategic partnership with Gogoror Inc. to accelerate the shift from fuel based mobility to sustainable electric mobility in India. During FY 2020-21, the company entered into Mexico market and the footprint of the company reached 41 markets outside India. On 04 February 2021,the company declared a special dividendof Rs 10 per share to mark the achievement of historic milestone of achieving 100 Million cumulative production of two wheelers. The company proactively paused its operations temporarily during the second wave at all of its manufacturing facilities across the country, including its Global Parts Center (GPC) in Neemrana and its R&D facility - the Centre of Innovation and Technology (CIT), Jaipur due to the Operations escalation of Covid-19 cases across the country. The company gradually resumed its operations from 17 May 2021 by starting single shift production at three of its plants - Gurugram and Dharuhera in Haryana and at Haridwar in the northern hill state of Uttarakhand.The company resumed production at all its manufacturing plants in India from 24 May 2021. During the second quarter of FY2022, Hero MotoCorp achieved two consecutive recognitions from the Guinness World Record for creating the Largest Motorcycle Logo' in August 2021 and for creating the Largest Online Photo Album of People Planting Plants' in September 2021. During the third quarter of FY2022,the company inaugurated a flagship dealership in Dubai to expand presence in the Gulf market to 10 customer touchpoints in 5 countries.Also Partnered with Gilera Motors in Argentina to expand Hero's presence in the country - inaugurated a flagship dealership in Buenos Aires under the partnership. The Company has 6 subsidiaries including step down subsidiaries and 2 associate companies as on March 31, 2022. During FY 2021-22, the Company commenced retail sales in Mexico and introduced an extensive portfolio of products. It relaunched the Hero brand in markets like Argentina, Kenya, Honduras and Nicaragua. It strengthened presence in Gulf region, expanding network of touchpoints, including dealerships, service centres and spare parts outlets; it entered into another exclusive dealership in Dubai. It reinvigorated strategy for the Nigerian market, leading to a 978% dispatch growth. It also launched a new motorcycle, Hunter,' developed especially for the market. In March 2022, Company launched a new brand Vida'-Powered by Hero, an in-house electric vehicle brand. It forayed into the pre-owned two-wheeler business under the brand Hero Sure - Powered by Wheels of Trust'. It expanded the network by adding super stockists, authorized representatives of dealers, Hero Sure network and HGPD. It launched Xpulse 200 4V in October, 2021. It launched the new Stealth variant, Xtreme 160R, a fast-pick up bike. During the year 2022, 45 new outlets were added, which increased their footprint to 43 markets outside India. It launched the official Hero merchandise business in August, 2021.

Hero MotoCorp Ltd Directors Reports

Dear Members,

Your Directors are pleased to present the thirty ninth annual report, together with the Company?s audited financial statements for the financial year ended MarcRs 31, 2022.

FINANCIAL RESULTS – STANDALONE & CONSOLIDATED

The standalone and consolidated financial highlights of your Company are as follows:

(Rs in crore)

Standalone Consolidated
Particulars Year ended Year ended
MarcRs 31, 2022 MarcRs 31, 2021 MarcRs 31, 2022 MarcRs 31, 2021
Total Income 29,802.38 31,380.47 30,106.29 31,517.09
Profit before Finance cost and Depreciation 3,925.68 4,599.09 3,999.78 4,657.41
Expenses
Finance cost 25.80 21.84 53.10 46.41
Depreciation and amortisation expenses 649.75 676.87 689.52 715.12
Profit from ordinary activities before share of Profit / (Loss) of associates 3,250.13 3,900.38 3,257.16 3,895.88
Profit/(Loss) of associates
Share in net profit/(loss) of associates - - (199.05) (46.56)
Profit from ordinary activities before tax 3,250.13 3,900.38 3,058.11 3,849.32
Tax expense
Current tax 797.91 924.92 805.44 931.38
Deferred tax (20.80) 11.26 (76.38) (18.11)
777.11 936.18 729.06 913.27
Net Profit from ordinary activities after tax 2,473.02 2,964.20 2,329.05 2,936.05
Other comprehensive income/(expense) (net of tax) (5.44) (21.06) (0.60) (25.87)
Total comprehensive income for the year 2,467.58 2,943.14 2,328.45 2,910.18
Net Profit/(loss) attributable to
a) Owners of the Company 2,473.02 2,964.20 2,316.88 2,917.75
b) Non-controlling interest - - 12.17 18.30
Other comprehensive income attributable to
a) Owners of the Company (5.44) (21.06) (2.44) (24.01)
b) Non-controlling interest - - 1.84 (1.86)
Total comprehensive income attributable to
a) Owners of the Company 2,467.58 2,943.14 2,314.44 2,893.74
b) Non-controlling interest - - 14.01 16.44
Balance of profit brought forward 12,462.15 11,416.82 12,648.70 11,652.06
Dividend
- Interim – 2021-22 1,198.87 1,398.46 1,198.87 1,398.46
- Final – 2020-21 699.26 499.35 699.26 499.35
Corporate Dividend Tax - - 1.12 2.49
Other comprehensive income arising from re-measurement of defined benefit obligation (net of income tax) - - (6.28) (20.81)
Balance carried to Balance Sheet 13,031.60 12,462.15 13,060.05 12,648.70
Earnings per equity share on Net Profit from ordinary activities after tax (face value Rs 2/- each) (In Rupees)
- Basic 123.78 148.39 115.96 146.07
- Diluted 123.74 148.37 115.93 146.04

FINANCIAL HIGHLIGHTS

During FY 2021-22, your Company clocked sales of 49.44 lakh units over 58.00 lakh units in the previous FY. Revenue from operations was Rs 29,245.47 crore as compared to Rs 30,800.62 crore in FY 2020-21, registering a decrease of_5.05%.

Profit before tax (PBT) in FY 2021-22 was Rs 3,250.13 crore as compared to Rs 3,900.38 crore in FY 2020-21, reflecting a decrease of 16.67%. Profit after tax (PAT) was Rs 2,473.02 crore as against Rs 2,964.20 crore in FY 2020-21, a decrease of 16.57 % from the previous year.

Earnings before Interest, Depreciation and Taxes (EBIDTA) stood at 11.52% in FY 2021-22, as compared to 13.05% in FY 2020-21.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with provisions of the Companies Act, 2013 (‘the Act?) and Indian Accounting Standards (Ind AS)-110 on Consolidated Financial Statements, read with Ind AS-28 on Investments in Associates and Joint Ventures, the Audited Consolidated Financial Statements for the year ended March_31, 2022 are provided in this annual report.

UPDATE ON PANDEMIC AND OTHER MATTERS

COVID-19

During the year, the auto industry witnessed disruptions triggered by Coronavirus pandemic, restricting movement of logistics and dampening customer sentiments. Despite such challenges, your Company remained resilient, positive and continued to grow. Your Company took several steps to protect the employees and the operations, while also initiating relief measures to aid the efforts initiated by your organization, and various governments and institutions. Strategic initiatives such as a strict discipline on expenses and prioritization of projects, aided in substantially reducing general overhead costs and capex.

The Company remains optimistic about growth in the next financial year as pandemic restrictions are witnessing a gradual withdrawal due to a steady decline in Covid-19 cases and reopening of all the sectors of economy.

Vida – Brand for Emerging Mobility Solutions

With a focus on sustainability and keeping up with the relentless pursuit towards its vision – Be the Future of Mobility, your Company unveiled Vida, powered by Hero, a brand-new identity for its emerging mobility solutions, including upcoming Electric Vehicles (EV).

Vida means life and the brand?s sole purpose is to create a positive impact on the world with the vision of a flourishing, meaningful world for future generations.

Income Tax matter

The Income Tax Department ("the Department") conducted a Search activity ("the Search") under Section 132 of the Income Tax Act on the Company in MarcRs 2022. Subsequently, the Company has provided all support, cooperation and the necessary documents to the Department. The Company is examining and reviewing the details of the matter and will take appropriate actions, including addressing regulatory actions, if and when they occur.

While the uncertainty exists regarding the outcome of the proceedings by the Department, the Company after considering all available information and facts as of date, has not identified the need for any adjustments to the current or prior period financial results.

The above matter has been disclosed as an ‘Emphasis of Matter? in the Audit Report and has also been mentioned in note no. 34(c) of the standalone financial statements. The Audit Report on the audited financial results of the Company (standalone & consolidated) remains unmodified.

CHANGES IN CAPITAL STRUCTURE

During the year under review, 31,724 equity shares of Rs 2/- each were allotted on exercise of Employee stock options and Restricted Stock Units (RSUs) by the employees of the Company. Consequently, the issued and paid-up share capital of the Company as on MarcRs 31, 2022 was Rs 39,96,23,882 divided into 19,98,11,941 equity shares of Rs 2/- each.

The Company has not issued any equity shares with differential rights, sweat equity shares or bonus shares. The Company has only one class of equity shares with face value of Rs 2/- each, ranking pari passu.

DIVIDEND

Your Directors are pleased to recommend for your approval a final dividend of Rs 35/- per equity share (1,750%) of face value of Rs 2/- each in addition to an interim dividend of Rs 60/- per equity share (3000%) declared in the month of February 2022, aggregating a total dividend payout of Rs 95/- per equity share (4,750%) for FY 2021-22. In the previous year, total dividend payout of Rs 105/- per equity share (5,250%) of face value of Rs 2/- each was made. Final dividend, if approved at the ensuing annual general meeting, shall be paid to the eligible members within the stipulated time period.

Dividend Distribution Policy of the Company as per the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations?) is available at the following link: https://www.heromotocorp.com/en-in/uploads/code_ policy/20191126105519-code-policy-149.pdf.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The management discussion and analysis report forms an integral part of this report and gives details of the overall industry structure, economic developments, performance and state of affairs of your Company?s business in India and abroad, risk management systems and other material developments during the year under review.

CHANGE IN NATURE OF BUSINESS

During FY 2021-22, there was no change in the nature of Company?s business.

CAPACITY EXPANSION, NEW PROJECTS & STRATEGIC ALLIANCES

The fiscal 2022 was a fascinating year during which your Company directed its resources on capitalizing opportunities, healthy investments and working towards business resilience with focus on growth and further strengthening the product portfolio. Due – Diligence on economic factors, commodity headwinds facilitated us to further evaluate our manufacturing capacity to view cross plant resource optimization with a broader lens to optimize capacity utilization.

The complete value chain eco-system quickly re-energized itself and the turnaround post business re-opening of COVID-19 pandemic was phenomenal considering the changed paradigm and facilitated your Company to revert on growth trajectory with stable sales volume and positive customer sentiment.

Your Company has the overall capacity of 9.3 million for all plants. The overseas plants of your Company in Bangladesh and Colombia have continuously augmented their respective capacities and with significant momentum in market share.

As a proactive corporate, your Company released its fourth annual Sustainability Report encompassing ESG (Environment, Social and Governance) aspects. Long-term strategy has been formulated with the objective of making your Company one of the leaders in ESG and target to establish a resilient business eco-system.

Agreement with Harley-Davidson – As part of its growth strategy, Hero MotoCorp is focused on growing market share in the rapidly expanding Premium motorcycle segment. In October 2020, the Company signed a distribution agreement with Harley-Davidson (H-D), under which the Company will sell and service H-D motorcycles, and sell parts and accessories and general merchandise riding gear and apparel in India. The Company has inducted 11 dealers of Harley-Davidson into its own distribution network. Starting January 1, 2021, Hero MotoCorp Ltd. has become the distributor for Harley-Davidson in India.

Hero MotoCorp Ltd. and Harley-Davidson also signed a Licensing agreement under which the Company will develop and sell a range of premium motorcycles under the H-D brand name.

Partnership with Gogoro? Inc. - Your Company recently entered into a strategic partnership with Gogoro? Inc. to accelerate the shift from fuel based mobility to sustainable electric mobility in India. This partnership would bring together the Company and Gogoro? Inc., the global leader in urban battery swapping and smart mobility innovation and this joint venture is aimed to bring Gogoro?s industry leading battery swapping platform to India. The Companies would also collaborate on electric vehicle development to bring Hero branded, powered by Gogoro Network vehicles to market

GLOBAL FORAYS

Your Company continues to strengthen its presence in global markets. During FY 2022, your Company?s footprint increased to 43 markets outside India. The focus was on increasing the presence in the premium segment through new product launches in the key markets of Bangladesh, Nepal and Latin America. As a result, the premium segment sales grew by 63% in FY 2022 over previous year.

Despite the tough Covid restrictions & unstable economy in some markets, your Company managed to gain market share in 6 out of 7 focus markets.

Your Company also relaunched the Hero brand in markets like Argentina, Kenya, Honduras and Nicaragua.

INNOVATION

In the last few years, there has been a strong focus to foster innovation inside the Company and we have seen a huge wave of cultural shift cutting across the functions organisation-wide. Multiple cross-functional/within-function initiatives were taken to find solutions collaboratively. Our Idea platform: HeroIC in its 3rd_year engaged users significantly and hosted campaigns tapping the latent opportunities harnessing internally residing diverse unique talents. It is appealing to confirm that thousands of unique ideas were registered in the last 3 years.

We started HeroHatch (Internal Incubator programme) sometime back which was supplemented by Vision Labs ideas with the potential to become stand-alone projects._ Internal startups have emerged as a strong pillar by solving the end problems of our customers, developing potential revenue streams, and inculcating a fast-paced and startup-like culture within the organisation. The three projects which were launched under Hero Hatch continue to grow impressively.

We are now starting to expand our base from Innovation inside to ecosystem support. This involves the scouting of startups, and mobility partners externally to explore opportunities in "Future of Mobility". This year, we will tap into the global innovation enablers to help us acquire multiple opportunities_to co-create and collaborate, the_first one of which is a partnership with Plug and Play (P&P). This ecosystem partnership will enable Hero to have access from the P&P team regarding the introduction of hand-picked start-ups in the emerging mobility & tech space within private deal flows, which are meant to solve a specific technological use case or aspirations of Hero?s Internal business unit.

SUBSIDIARY, ASSOCIATE AND JOINT VENTURE COMPANIES

The Company has 6 subsidiaries including step down subsidiaries and 2 associate companies and regularly monitors the performance of these companies.

The annual accounts of subsidiary companies are available on the website of the Company viz. www.heromotocorp.com and shall also be kept open for inspection at the registered office of the Company. The Company shall also make available the annual accounts of these companies to any member of the Company who may be interested in obtaining the same. The consolidated financial statements presented by the Company include the financial results of its subsidiary companies.

Subsidiary Companies

Hero Tech Center Germany GmbH (‘HTCG?)

HTCG is a wholly owned subsidiary of your Company, incorporated in Germany to undertake research and development and such other ancillary activities for the manufacture, testing, validating etc. of two-wheelers and components/parts thereof. It also undertakes, coordinates and facilitates two-wheeler rally participation and development activities. During FY 2021-22, HTCG has reported unadjusted revenue of Rs 114.1 crore and a net profit of Rs 5.8 crore.

HMCL Netherlands B.V. (‘HNBV?)

HNBV is a wholly owned subsidiary of your Company, incorporated in Amsterdam as a private company with limited liability under the laws of The Netherlands with the primary objective of promoting overseas investments. During FY 2021-22, it has reported unadjusted revenue of Rs 10.08 crore and a net profit of Rs 8.8 crore.

HMCL Colombia S.A.S. (‘HMCLC?)

HMCLC was incorporated in Colombia as a joint venture between HNBV and Woven Holdings LLC as a simplified stock corporation company. HNBV currently holds 68% equity in HMCLC and 32% equity is held by Woven Holdings LLC. The main business of HMCLC is to manufacture and sell two-wheelers in Colombia. It has a manufacturing facility with a production capacity of 80,000 units per annum. During the year ended MarcRs 31, 2022, the Company has reported unadjusted revenue of Rs 378.8 crore and a net loss of Rs 1.8 crore.

HMCL Niloy Bangladesh Limited (‘HNBL?)

HNBL was incorporated in Bangladesh as a joint venture between HNBV and Niloy Motors Limited, Bangladesh as a limited liability company. HNBV currently holds 55% equity in HNBL and 45% equity is held by Nitol Niloy Group, Bangladesh. The main business of HNBL is to manufacture and sell two-wheelers. It has a manufacturing facility with a production capacity of 1,50,000 per annum. During FY 2021-22, HNBL reported unadjusted revenue of Rs 659.2 crore and a net profit of Rs 38.3 crore.

HMCL Americas Inc. (‘HMCLA?)

HMCLA is a wholly owned subsidiary of your Company, incorporated as a Corporation pursuant to the General Corporation Law of the State of Delaware, United States of America with the primary objective to pursue various global businesses. During the year ended MarcRs 31, 2022, HMCLA has reported unadjusted revenue of Rs 0.01 crore and a net loss of Rs 0.06 crore.

HMC MM Auto Limited (‘HMCMMA?)

Your Company has a joint venture with Marelli Europe S.p.A, Italy, namely HMC MM Auto Limited in India, which is set up for the purpose of carrying out manufacturing, assembly, sale and distribution of two-wheeler fuel injection systems and parts. Your Company holds 60% of the equity share capital in HMCMMA. During FY 2021-22, HMCMMA has reported unadjusted revenue of Rs 228.4 crore and a net loss of Rs 11.3 crore.

Associate Companies

Hero FinCorp Limited (‘HFCL?)

HFCL is an associate of your Company, incorporated in the year 1991. Your Company holds 41.19% in the equity share capital of HFCL. HFCL is a non-banking finance company engaged in providing financial services, including two-wheeler financing and providing credit to Company?s vendors and suppliers. Over the years, it has added several new products and customers in its portfolio, like SME and commercial loans, loan against property etc.

During FY 2021-22, HFCL?s loss attributable to the Company is Rs 63.1 crore.

Ather Energy Private Limited (‘AEL?)

AEL is a private limited company, focused on developing, designing and selling premium electric two-wheelers. The shareholding of your Company in AEL is 37.65% which is equivalent to 34.04% on a fully diluted basis. During FY 2021-22, AEL?s loss attributable to the Company is Rs 94.5 crore.

A statement containing salient features of financial statements of subsidiary and associate companies forms part of the financials.

Material Subsidiaries

The Board of Directors of your Company (‘the Board?) has approved a policy for determining material subsidiaries. At present, your Company does not have a material subsidiary. The Policy on material subsidiaries can be viewed on the Company?s website, www.heromotocorp.com at the following link: https://www.heromotocorp.com/en-in/uploads/code_ policy/20191126105356-code-policy-400.pdf.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Dr. Pawan Munjal was re-appointed as the Chairman, Whole-time Director and CEO of the Company, designated as ‘Chairman & CEO?, for a term of five (5) years with effect from October_1, 2021.

During the year under review, your Company has appointed Ms. Camille Tang and Mr. Rajnish Kumar as Non-Executive and Independent Directors for a term of 3 years w.e.f November 19, 2021 and November 25, 2021, respectively. Ms. Vasudha Dinodia was appointed as Non-Executive & Non Independent Director of the Company effective November 25, 2021.

Mr. Vikram Sitaram Kasbekar was re-appointed as Whole-time Director, designated as Executive Director - Operations (Plants) for a term of three years w.e.f August 8, 2019. His term will end on August 7, 2022. Now, the Board at its meeting held on May 3, 2022 has recommended the re-appointment of Mr. Kasbekar as Whole-time Director designated as Executive Director – Operations (Plants) for another term of two (2) years effective August 8, 2022. Further, in terms of applicable provisions of the Act and the Articles of Association of the Company, Mr. Vikram Sitaram Kasbekar, Director of the Company, retires by rotation at the ensuing annual general meeting and being eligible, has offered himself for re-appointment. Brief resume and other details of Mr. Kasbekar have been furnished in the explanatory statement to the notice of the ensuing annual general meeting.

The appointment of new directors is recommended by the Nomination and Remuneration Committee (‘NRC?) on the basis of requisite skills, proficiency, experience and competencies as identified and finalized by the Board considering the industry and sector in which the Company operates. The Board, on the recommendation of the NRC, independently evaluates and if found suitable, confirms an appointment to the Board. The appointments are based on the merits of the candidate and due regard is given to diversity including factors like gender, age, cultural, educational & geographical background, ethnicity, etc.

In the opinion of the Board, the Independent Directors appointed during the year are persons of high repute, integrity and possesses the relevant expertise and experience in the respective fields.

The Company has a robust succession planning process which is overseen by the Nomination and Remuneration Committee.

The tenure of Mr. M. Damodaran on the Board of Hero MotoCorp Ltd. is until the end of day of May 3, 2022.

None of the Directors on the Board of the Company has been debarred or disqualified from being appointed or continuing as director of the Company by the Securities and Exchange Board of India, Ministry of Corporate Affairs or any other statutory authority.

Key Managerial Personnel

Ms. Neerja Sharma resigned and ceased to be the Company Secretary and Chief Compliance Officer of the Company with effect from January 31, 2022. Mr. Dhiraj Kapoor has been appointed as the Company Secretary and Compliance Officer of the Company w.e.f. February 1, 2022. He has a rich experience of over 20 years in corporate laws and compliance.

Dr. Pawan Munjal, Chairman, Whole-time Director & CEO, Mr. Niranjan Gupta, Chief Financial Officer and Mr. Dhiraj Kapoor, Company Secretary and Compliance Officer are the Key Managerial Personnel of your Company in accordance with the provisions of Section 2(51) and 203 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Declarations from Independent Directors

Your Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed in the Act and the Listing Regulations.

In the opinion of the Board, Independent Directors fulfil the conditions specified in the Act, Rules made thereunder and Listing Regulations and are independent of the management.

BOARD MEETINGS

During FY 2021-22, nine meetings of the Board of Directors were held. For details of these Board meetings, please refer to the section on Corporate Governance of this annual report.

COMMITTEE MEETINGS

During FY 2021-22, various committee meetings were conducted by the Company. For details of these Committee meetings, please refer to the section on Corporate Governance of this annual report.

ANNUAL EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS

A formal evaluation of the performance of the Board, it?s Committees, the Chairman and the individual Directors was carried out for FY 2021-22. Led by the Nomination and Remuneration Committee, the evaluation was carried out using individual questionnaires covering, amongst others, composition of Board, conduct as per company values & beliefs, contribution towards development of the strategy & business plan, risk management, receipt of regular inputs and information, codes & policies for strengthening governance, functioning, performance & structure of Board Committees, skill set, knowledge & expertise of Directors, preparation & contribution at Board meetings, leadership, etc.

Further, the Committees were evaluated in terms of receipt of appropriate material for agenda topics in advance with right information and insights to enable them to perform their duties effectively, review of committee charter, updation to the Board on key developments, major recommendations & action plans, stakeholder engagement, devoting sufficient time & attention on its key focus areas with open, impartial & meaningful participation and adequate deliberations before approving important transactions & decisions.

As part of the evaluation process, the performance of Non-Independent Directors, the Chairman and the Board was conducted by the Independent Directors. The performance evaluation of the respective Committees and that of Independent and Non-Independent Directors was done by the Board excluding the Director being evaluated.

The actions emerging from the Board evaluation process were collated and presented before the Nomination and Remuneration Committee as well as the Board. Suggestions/ feedback concerning strategic, governance and operational matters were actioned upon by the team.

DIRECTORS? RESPONSIBILITY STATEMENT

Your Directors make the following statement in terms of Section 134 of the Act, which is to the best of their knowledge and belief and according to the information and explanations obtained by them:

1. that in the preparation of the annual accounts for the financial year ended MarcRs 31, 2022, the applicable accounting standards were followed, along with proper explanation relating to material departures;

2. that appropriate accounting policies were selected and applied consistently and judgements and estimates that are reasonable and prudent were made so as to give a true and fair view of the state of affairs As at March31, 2022 and of the profit and loss of your Company for the financial year ended MarcRs 31, 2022;

3. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

4. that the annual accounts for the financial year ended MarcRs 31, 2022 have been prepared on a going concern basis;

5. that the Directors have laid down Internal Financial Controls which were followed by the Company and that such Internal Financial Controls are adequate and were operating effectively; and

6. that the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

REMUNERATION AND BOARD DIVERSITY POLICY

Pursuant to provisions of the Act, the Nomination and Remuneration Committee of your Board has formulated a Remuneration and Board Diversity Policy for the appointment and determination of remuneration of the Directors, Key Managerial Personnel, senior management and other employees of your Company and to ensure diversity at the Board level. The NRC has also developed the criteria for determining the qualifications, positive attributes and independence of Directors and for making payments to Executive and Non-Executive Directors of the Company.

The Nomination & Remuneration Committee (NRC) takes into consideration the best remuneration practices in the industry while fixing appropriate remuneration packages and for administering the long-term incentive plans, such as ESOPs, RSUs etc. Further, the compensation package of the Directors, Key Managerial Personnel, senior management and other employees is designed based on the set of principles enumerated in the said policy.

Your Directors affirm that the remuneration paid to the Directors, Key Managerial Personnel, senior management and other employees is as per the Remuneration Policy of your Company.

The remuneration details of the Directors, Chief Financial Officer and Company Secretary, along with details of ratio of remuneration of each Director to the median remuneration of employees of the Company for the year under review are provided as Annexure - I.

There has been no change in the Remuneration and Board Diversity Policy of the Company during the year. The Remuneration and Board Diversity Policy of your Company can be viewed at the following link: https://www.heromotocorp. com/en-in/uploads/code_policy/20191126105210-code-policy-421.pdf

The salient features of the Remuneration and Board Diversity Policy are as under:

1. To determine remuneration of Directors, KMP, other senior management personnel and other employees, keeping in view all relevant factors including industry trends and practices.

2. At the Board meeting, only the Non-Executive and Independent Directors shall participate in approving the remuneration paid to the Executive Directors.

3. The remuneration structure for the Executive Directors would include basic salary, commission, perquisites & allowances, contribution to Provident Fund and other funds. If the Company has no profits or its profits are inadequate, they shall be entitled to minimum remuneration as prescribed under the Act.

4. The Non-Executive and/or Independent Directors will also be entitled to remuneration by way of commission aggregating up to 1% of net profits of the Company pursuant to the provisions of Sections 197 and 198 of the Act, in addition to sitting fees.

5. The compensation for Key Managerial Personnel, senior management and other employees is based on the external competitiveness and internal parity through periodic benchmarking surveys. It includes basic salary, allowances, perquisites, loans and/or advances as per relevant HR policies, retirement benefits, performance linked pay out, benefits under welfare schemes, etc. besides long-term incentives/ ESOPs/ RSUs/ Performance shares or such other means as may be decided by the NRC.

6. Performance goals of senior management personnel shall be quantifiable and assessment of individual performance to be done accordingly. A significant part of senior management compensation will be variable and based upon Company?s performance.

7. To ensure adequate diversity at Board level, all appointments to be made on the basis of merit and due regard shall be given to other diversity attributes also. The NRC shall recommend the appointment or continuation of members to achieve optimum combination at the Board and periodically assess the specific requirements in relation to Board diversity.

EMPLOYEES? INCENTIVE SCHEME

In terms of the erstwhile SEBI (Share Based Employee Benefits) Regulations, 2014, and SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, as amended from time to time (‘SEBI Regulations?), the NRC of your Board, inter-alia, administers and monitors the Employees? Incentive Scheme, 2014 of your Company and the Employees? Stock Option / Restricted Stock Units plans framed thereunder.

Further, the NRC has, at its meeting held on August 11, 2021 approved grant of 39,210 Restricted Stock Units (RSUs) at face value of Rs 2/- per unit vesting in three years in the ratio of 33.33%:33.33%:33.33% as per RSU Plan, 2021 and 34,895

Performance Restricted Stock Units (PRSUs) at face value of Rs 2/- per unit vesting after completion of three years as per PRSU Plan, 2021 to certain eligible employees of the Company.

Applicable disclosures as stipulated under the SEBI Regulations with regard to the Employees? Stock Option Scheme are available on the Company?s website, www.heromotocorp.com and can be viewed at the following link: https://www.heromotocorp. com/en-in/investors/annual-reports.html. Further, there is no material change in the scheme and the scheme is in compliance with the applicable regulations.

Your Company has received a certificate from M/s Sanjay Grover & Associates, Secretarial Auditors (Firm Registration No. P2001DE052900) that the Employees? Incentive Scheme, 2014 for grant of stock options has been implemented in accordance with the SEBI Regulations and the resolution passed by the members of the Company. The certificate would be placed/ available at the ensuing annual general meeting for inspection by the members.

CORPORATE GOVERNANCE

Your Company is committed to benchmarking itself with global standards of Corporate Governance. It has put in place an effective Corporate Governance system which ensures that provisions of the Act and Listing Regulations are duly complied with, not only in form but also in substance.

The Board has also evolved and adopted a Code of Conduct based on the principles of good Corporate Governance and best management practices that are followed globally. The Code is available on your Company?s website, www.heromotocorp. com and can be viewed at the following link: https://www. heromotocorp.com/en-in/about-us/code-of-conduct.html.

In terms of Listing Regulations, a report on Corporate Governance along with the certificate from M/s. Sanjay Grover & Associates, Company Secretaries (Firm Registration No. P2001DE052900) confirming compliance of the conditions of Corporate Governance is annexed hereto and forms part of this annual report as Annexure – II and Annexure – III respectively.

TRANSFER TO GENERAL RESERVE

During the year under review, no amount has been transferred to General Reserve of the Company.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the year under review, your Company has transferred unpaid/unclaimed dividend, amounting to Rs 10.45 crore for FY 2013-14 (Final Dividend) & FY 2014-15 (Interim Dividend) and 20,829 shares to the Investor Education and Protection Fund (IEPF) Authority of the Central Government of India. Further, dividend pertaining to the shares transferred to demat account of the IEPF Authority amounting to Rs 7.55 crore (after deduction of tax) was also transferred to the IEPF Authority.

MATERIAL CHANGES AND COMMITMENTS

No material change and/or commitment affecting the financial position of your Company has occurred between April 1, 2022 and the date of signing of this report.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

During FY 2021-22, your Company has not given any loan or guarantee pursuant to provisions of Section 186 of the Act. Details of investments made in terms of Section 186 of the Act are as under:

(Rs in crore)

Principal Amount (Shares) Principal Amount (Bonds/ Debentures) Total
Opening 2,365.53 652.78 3,018.31
Addition* - 554.28# 554.28
Reduction** - (49.13) (49.13)
Closing Balance 2,365.53 1,157.93 3,523.46

*HMC MM Auto Limited - Nil, HMCL Netherlands BV - Nil, HMCL Americas Inc. - Nil, Hero Tech Center Germany GmbH - Nil, Hero FinCorp Limited – Nil #Includes investment in Compulsorily Convertible Debentures of Ather Energy Private Limited – Rs 150 crore **Maturity of bonds and debentures

DEPOSITS

Your Company has neither accepted nor renewed any deposits during FY 2021-22 in terms of Chapter V of the Act.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

During FY 2021-22, all contracts/ arrangements/ transactions entered into by your Company with related parties under Section 188(1) of the Act were in the ordinary course of business and on an arm?s length basis. During FY 2021-22, your Company has not entered into any contract/ arrangement/ transaction with related parties which could be considered ‘material? in accordance with its Policy on Materiality of Related Party Transactions. Thus, there are no transactions required to be reported in Form AOC-2.

Further, during FY 2021-22, there were no materially significant related party transactions entered into by your Company with the Promoters, Directors, Key Managerial Personnel or other designated persons, which might have potential conflict with the interest of the Company at large.

All related party transactions are placed before the Audit Committee for its approval. There was no related party transaction requiring approval of the Board. During FY under review, the Audit Committee has approved transactions through the omnibus mode in accordance with the provisions of the Act and Listing Regulations. Related party transactions were disclosed to the Board on regular basis as per Ind AS-24. Details of related party transactions as per Ind AS-24 may be referred to in Note 36 of the Standalone Financial Statements.

The policy on related party transactions is available on the Company?s website, www.heromotocorp.com and can be viewed at the following link: https://www.heromotocorp. com/en-in/uploads/code_policy/20191126104550-code-policy-434.pdf.

RISK MANAGEMENT FRAMEWORK

The Risk Management Committee of the Board continues to guide the Management Team in operating a comprehensive risk management framework.

The Company?s risk management procedures take into consideration external as well as internal threats to devise efficient strategies for mitigating a diverse set of risks. Risk identification, analysis, mitigation and monitoring is undertaken periodically by the_Management Team and is overseen by the Risk Management Committee. Several management and leadership team members are_ actively involved to ensure consistency in the overall process. Post assessment, mitigation plans are developed and a report is submitted periodically to the Risk Management Committee of the Board.

COVID continued to impact lives and livelihood. However, your company was well prepared for managing the impact. A special task force used to frequently meet to assess the situation as it evolved across manufacturing plants, sales network, supply chain partners and offices and identify additional initiatives to ensure business continuity.

In addition to developing a robust Business Continuity Plan to manage the COVID related disruptions, your company focused on some of the other key risk areas as well and developed mitigation plans. Some of those risks were –

Semiconductor shortage – Semiconductor shortage affected almost every automobile OEM. There was an increase in lead-time and many orders remained pending. However, your company made sure that the shortage did not significantly affect the supply chain and manufacturing. Your Company reached out to identify alternate sources for critical components and started tracking inventories at a child part level. As we plan to enter the electric vehicle segment, the shortage of semiconductors could pose a credible threat and your company is already developing plans to manage the risk well.

Shifting consumer preferences towards electric mobility_ – The 2W industry has shown an unprecedented growth in EV adoption this year. Your Company is prepared to gain from this segmental shift. The first in house 2W EV product will be launched under the new brand VIDA that means Life.

Risk due to climate change – Rising global temperatures are making it mandatory for manufacturers to contribute towards emission reduction initiatives. While investing in electric mobility is definitely a step towards addressing this challenge, your company is also exploring ways in which shared mobility can be promoted. A risk mitigation plan to this effect is already developed.

Geopolitical uncertainties in key global markets – The business sentiment continued to remain challenging with many global economies losing steam. The logistics and supply chain industry too was hit hard. However, your company was able to manage these risks by realising volumes from countries that soon returned to pre pandemic growth and output levels. Also, on the supply chain, your Company has built a strong local base and that made sure that your Company?s operations were not impacted.

Cost pressures in material sourcing – As cost pressures continued to affect margins, your company evaluated options to develop alternate and innovative strategies for part manufacturing. A significant amount of cost increase could be offset because of the savings from the LEAP and LEAD programmes.

Your Company remains committed to protecting the interests of its customers, investors, shareholders, employees and each person or entity with whom it is associated.

The details of the Committee along with its charter are set out in the Corporate Governance Report forming part of this report.

VIGIL MECHANISM/ WHISTLE-BLOWER POLICY/ CODE OF CONDUCT

Your Company is committed to highest standards of ethical, moral and legal business conduct. Accordingly, the Board of Directors have formulated the Vigil Mechanism/Whistle-_Blower Policy which provides a robust framework for dealing with genuine concerns and grievances. Your Company has an ethics hotline managed by a third party which can be used by employees, Directors, vendors, suppliers, dealers etc. to report any violations to the Code of Conduct. Specifically, employees can raise concerns regarding any discrimination, harassment, victimisation, any other unfair practice being adopted against them or any instances of fraud by or against your Company.

During the year, your Company?s Compliance programme was further strengthened by conducting an assessment of the existing policies and procedures from an Anti-Bribery and Anti-Corruption perspective. Based on the assessment, your Company further made revisions to its key policies and procedures and instituted in place an Anti-Bribery and Anti-Corruption ("ABAC") policy in line with the leading industry practices and applicable laws such as The Prevention of Corruption Act, 1988, The Foreign Corrupt Practices Act (US), 1977 and the UK Bribery Act, 2010. Subsequent to the institutionalisation of the ABAC policy, your Company plans to conduct entity-wide trainings educating the employees about the applicability of laws, importance of its abidance and guidance in place to safeguard your Company from the associated risks.

In continuation to the Code of Conduct which was refreshed during the last financial year, all employees of your Company underwent a mandatory Code of Conduct training which covered the eight (8) pillars of your Company?s Code of Conduct and included guidance on all governing principles such as Anti-bribery & Anti-corruption, conflict of interest, fair business practices, transparency and emphasis on equal opportunities while embracing a diverse and inclusive culture.

During the year under review, 24 complaints were received through various reporting channels and 8 complaints were carried forward from the previous year. Out of these, 28 complaints have been investigated, 3 complaints were reviewed and handed over for closure to the procurement team and remaining 1 complaint is under investigation.

During FY 2021-22, no individual was denied access to the Audit Committee for reporting concerns, if any.

The Vigil Mechanism/Whistle-Blower Policy of the Company is available on the Company?s website, www. heromotocorp.com and can be viewed at the following link: https://www.heromotocorp.com/en-in/uploads/code_ policy/20200903060455-code-policy-95.pdf

SUSTAINABILITY AND CORPORATE SOCIAL RESPONSIBILITY

Hero MotoCorp, as a responsible corporate citizen, has been consciously fulfilling its obligations, commitments and overall corporate responsibility within its local and global environments. The Company has been responsibly managing not only its business performance but also its environmental and social impact. While the Company?s sustainability strategy revolves around five pillars – inclusive growth, eco-efficiency, people, responsible value chain, and product stewardship, the Corporate Social Responsibility (CSR) vision of the Company is to ‘have a greener, safer and equitable world?. Within this mandate, the Company recognises the role of biodiversity in achieving sustainable economic growth and has therefore expanded and strengthened its initiatives for biodiversity protection and resource conservation. This also aligns with the Company?s commitment to the Sustainable Development Goals (SDGs).

We understand that adopting and implementing sustainable business practices is the Company?s ‘responsibility?, and equally importantly, that sustainability strategy and CSR activities are intertwined and complement as well as supplement each other. Therefore, at Hero MotoCorp, both these aspects are governed together by a common decision-making team that focuses on initiatives with the shared vision of a larger, long-term and sustainable impact.

Sustainability and Corporate Social Responsibility Committee

The Company?s Sustainability and Corporate Social Responsibility (SCSR) Committee functions under the direct supervision of Dr. Pawan Munjal, Chairman & CEO of the Company, and also the Chairman of the CSR Committee. Other members of the Committee are: Mr. Pradeep Dinodia, Non-Executive Director, Prof. Jagmohan Singh Raju, Independent Director, and Ms. Tina Trikha, Independent Director.

Policy

The CSR Policy of the Company can be viewed at the following link: https://www.heromotocorp.com/en-in/uploads/code_ policy/20191126104858-code-policy-35.pdf.

The salient features of the updated CSR Policy are as under:

1. The philosophy of the Company is guided by the belief that a company?s performance must be measured by its triple (+one) bottom line contribution to building economic, social and environmental capital, thereby enhancing societal sustainability along with governance.

2. It believes that in the strategic context of business, enterprises possess-beyond mere financial resources-the transformational capacity to create game-changing development models by unleashing their power of entrepreneurial vitality, innovation and creativity. In line with this belief, the Company will continue to craft unique models to generate livelihoods and create a better society.

3. The broad guiding principles for selection of CSR activities include need assessment, if required, and the requirement that programmes identified/adopted should be adaptive and flexible to meet the changing dynamics with focus on long-term sustained impact rather than one-time impact or requiring continuous intervention.

4. The implementation of the identified CSR activities shall be carried out either directly by the Company and/or through an implementing agency. The Company shall clearly define the objectives along with the desired timelines to effectively implement the activities within the given time frame and work towards active engagement of all employees to achieve maximum benefits. The modalities of execution shall be defined with every identified project.

5. There shall be a robust monitoring system to ensure that the identified CSR activities are carried out to reap optimal benefits for the beneficiaries. There shall be a periodic review by the Committee for the projects undertaken. The Committee may suggest modifications in the planned activities considering the existing scenario/circumstances.

6. The Committee will place for the Board?s approval an annual action plan delineating the CSR Programmes to be carried out during the financial year and the succeeding years in the case of Ongoing Projects, along with the specified budgets thereof.

FY 2021-22 update

During the year under review, your Company spent Rs 87.85 crore on its CSR activities which is more than 2% of the average net profits of previous three financial years. The CSR initiatives undertaken by your Company, along with other details, form part of the annual report on CSR activities for FY 2021-22, which is annexed as Annexure – VI.

AUDIT COMMITTEE

The Audit Committee of your Company comprises of the following Non-Executive and Independent Directors:

1. Mr. M. Damodaran - Chairman
2. Mr. Pradeep Dinodia - Member
3. Ms. Tina Trikha - Member
4. Air Chief Marshal B.S. Dhanoa (Retd.) - Member

The details on the Audit Committee and its terms of reference etc. have been furnished in Corporate Governance Report which forms part of this report as Annexure - II.

During the year under review, all recommendations of the Audit Committee were accepted by the Board of Directors of the Company.

AUDITORS AND AUDITORS? REPORT

Statutory Auditors

M/s. BSR & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W-100022) were appointed in 2017 as the Statutory Auditors of the Company until the conclusion of the 39th annual general meeting of the Company. They have audited the financial statements of the Company for the year under review. The observations of Statutory Auditors in their Report, read with relevant Notes to Accounts are self-explanatory and, therefore, do not require further explanation. The Auditors? Report does not contain any qualification, reservation or adverse remark. The tenure of the Statutory Auditors will end at the ensuing annual general meeting of the Company.

Cost Auditors

The Board, on the recommendation of Audit Committee, has approved the appointment of M/s R J Goel & Co., Cost Accountants, as Cost Auditors for the financial year ending MarcRs 31, 2023. The Cost Auditors will submit their report for the FY 2021-22 on or before the due date.

In accordance with the provisions of Section 148 of the Act read with Companies (Audit & Auditors) Rules, 2014, your Company is required to maintain cost records and accordingly, such accounts and records are maintained by the Company. Further, since the remuneration payable to the Cost Auditors is required to be ratified by the shareholders, the Board recommends the same for approval by members at the ensuing annual general meeting.

Secretarial Auditors

M/s. Sanjay Grover & Associates, Company Secretaries (Firm Registration No. P2001DE052900) were appointed to conduct Secretarial Audit of your Company during FY 2021-22.

The Secretarial Audit Report for the said year is annexed herewith and forms part of this report as Annexure – VII. The Report does not contain any qualification, reservation or adverse remark.

Further, there were no frauds reported by the Statutory Auditors, Secretarial Auditors and Cost Auditors to the Audit Committee or the Board under Section 143(12) of the Act.

INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

Your Company has a robust and well embedded system of internal controls. Comprehensive policies, guidelines and procedures are laid down for all business processes. The internal control system has been designed to ensure that financial and other records are reliable for preparing financial and other statements and for maintaining accountability of assets.

An extensive risk based programme of internal audits and management reviews provides assurance to the Board regarding the adequacy and efficacy of internal controls. The internal audit plan is dynamic and aligned to the business objectives of the Company and is reviewed by the Audit Committee each quarter. Further, the Audit Committee also monitors the status of management actions emanating from internal audit reviews. Such actions are now being tracked through an automated tool.

During the year, such controls were assessed and no reportable material weaknesses in the design or operation were observed.

CODE FOR PREVENTION OF INSIDER TRADING

In compliance with the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 (‘the PIT Regulations?) on prevention of insider trading, your Company during the year has revised its Code of Conduct for regulating, monitoring and reporting of trading by Designated Persons in line with the relevant amendments in the listing and PIT Regulations. The said Code lays down guidelines, which advise Designated Persons on the procedures to be followed and disclosures to be made in dealing with the shares of the Company and cautions them on consequences of non-compliances.

Your Company also has a Code of practices and procedures of fair disclosures of unpublished price sensitive information including a policy for determination of legitimate purposes along with the Institutional Mechanism for prevention of insider trading and Policy and procedures for inquiry in case of leak of unpublished price sensitive information or suspected leak of unpublished price sensitive information. Further, your Company has put in place adequate and effective system of internal controls and standard processes have been set to ensure compliance with the requirements given in these regulations to prevent insider trading.

To increase awareness on the prevention of insider trading in the organisation and to help the Designated Persons to identify and fulfill their obligations, a comprehensive campaign was run at all locations of Hero MotoCorp Ltd. This included display of relevant and useful content by way of posters on the notice boards & other strategic locations, placement of standees at common areas, key messaging through desktop wallpapers and screensavers, placement of permanent wall posters, orientation sessions as part of regular employee induction, conducting Company-wide workshop for all Designated Persons by a subject matter expert, sending text messages for closure of trading window and submission of periodic disclosures, etc. In addition to the above, a Handbook on Prevention of Insider Trading Code was also prepared and sent to all the designated employees to educate and promote awareness.

BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT

Keeping up the commitment to sustainability, your Company has voluntarily prepared the Business Responsibility & Sustainability Report (‘BRSR?) which forms part of the annual report as Annexure – VIII. The Report provides a detailed overview of initiatives taken by your Company from environmental, social and governance perspectives.

LISTING

The equity shares of your Company are presently listed on the BSE Limited (‘BSE?) and the National Stock Exchange of India Limited (‘NSE?).

PERSONNEL

As on MarcRs 31, 2022, total number of employees on the records of your Company were 9,173 as against 8,793 in the previous year.

Your Directors place on record their appreciation for the significant contribution made by all employees, who through their competence, dedication, hard work, co-operation and support have enabled the Company to cross new milestones on a continual basis.

PARTICULARS OF EMPLOYEES

The statement of Disclosure of Remuneration under Section 197 of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (‘Rules?), is appended as Annexure I to the report. The information as per Rule 5(2) of the Rules forms part of this report. However, in terms of provisions of Section 136 of the Companies Act, 2013, the report and Financial Statements are being sent to the members of the Company excluding the statement of particulars of employees under Rule 5(2) of the Rules. Any member interested in obtaining a copy of the said statement may write to the Company Secretary at the registered office of the Company.

ANNUAL RETURN

In terms of Sections 92(3) and 134(3)(a) of the Act, annual return is available under the ‘Investors? section of the Company?s website, www.heromotocorp.com and can be viewed at the following link: https://www.heromotocorp.com/en-in/ investor-downloads.html.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company is fully compliant with the applicable Secretarial Standards (SS) viz. SS-1 & SS-2 on Meetings of the Board of Directors and General Meetings respectively.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information required under Section 134(3)(m) of the Act read with Rules made thereunder is annexed to this report as

Annexure – IX.

STATUTORY DISCLOSURES

Your Directors state that there being no transactions with respect to following items during the year under review, no disclosure or reporting is required in respect of the same:

1. Deposits from the public falling within the ambit of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

2. Issue of equity shares with differential rights as to dividend, voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of your Company under any scheme, save and except ESOS referred to in this report.

4. The Whole-time Directors of your Company didn?t receive any remuneration or commission from any of its subsidiaries.

5. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company?s operations in future.

6. Buy-back of shares or under Section 67(3).

7. No application was made or any proceeding is pending under the Insolvency and Bankruptcy Code, 2016.

8. No settlements have been done with banks or financial institutions.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

Hero MotoCorp has in place a policy towards Prevention of Sexual Harassment at Workplace. This policy is in line with the requirements of ‘The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013?. All employees, whether permanent, contractual, temporary and trainees or belonging to any other category as per the definition of POSH are covered under this Policy.

Our Company aims at providing a safe workplace free from sexual harassment to its employees. It also has a ‘Zero Tolerance? Policy towards POSH. To achieve this objective, effective communication is the key and thus the Company regularly organizes awareness sessions at all locations to sensitise its employees and conducts frequent sessions in a professional manner.

During FY 2021-22, over 36 POSH Webinar Sessions were organised and in addition POSH Sessions were planned through the e-module mode. In all, POSH sessions were attended by 4,257 employees from across the organisation indicating a 95% coverage percentage. All new workmen and women associates,on joining the Company undergo a mandatory session on POSH.

In addition to the above, the Training Module of ‘Unconscious Bias? was undertaken for Senior Managerial Staff covering 83%.

As per the said Policy, an Internal Committee (IC) is also in place towards redressal of complaints received regarding sexual harassment. Following is the summary of complaints received and disposed off during the year under review:

No. of complaints received: 7

No. of complaints disposed off: 7

No. of complaints withdrawn: 0

No. of complaints pending: 0

DISCLOSURE UNDER THE HUMAN IMMUNODEFICIENCY VIRUS AND ACQUIRED IMMUNE DEFICIENCY SYNDROME (PREVENTION AND CONTROL) ACT, 2017

During the year under review, no complaints were received by the Complaints Officer under the Human Immunodeficiency Virus and Acquired Immune Deficiency Syndrome (Prevention and Control) Act, 2017.

AWARDS AND RECOGNITION

During the year, the Company received multiple awards and recognition. Some of them are listed below:

• ‘Manufacturer of the Year 2021? by Bike India (Magazine)

• ‘Best Workplaces for Women 2021? by the Economic Times to Neemrana Plant

• The Centre of Innovation & Technology was conferred with CII GreenCo Platinum award.

• Energy Efficient Unit Award by CII to the Haridwar Plant

• Gold Award by CII National Safety Practices to the Neemrana Plant

• ‘State Safety Award 2021? by Government of Rajasthan to Global Parts Centre, Neemrana

ACKNOWLEDGEMENTS

The Board of Directors would like to express their sincere thanks to the shareholders and investors of the Company for the trust reposed in the Company over the past several years. Your Directors would also like to thank the central government, state governments, financial institutions, banks, customers, employees, dealers, vendors and ancillary undertakings for their co-operation and assistance. The Board would like to reiterate its commitment to continue to build the organisation into a truly world-class enterprise in all aspects.

For and on behalf of the Board
Dr. Pawan Munjal
Place: New Delhi Chairman & CEO
Date: May 3, 2022 DIN: 00004223

   

Hero MotoCorp Ltd Company Background

Pawan Munjal
Incorporation Year1984
Registered OfficeThe Grand Plaza Plot No 2,Nelson Mandela Road VasantKunj
New Delhi,New Delhi-110070
Telephone91-11-46044220,Managing Director
Fax91-11-46044399
Company SecretaryDhiraj Kapoor
AuditorBSR & Co LLP
Face Value2
Market Lot1
ListingBSE,MSEI ,NSE,
RegistrarKFin Techologies Ltd
Karvy Selenium Tow-B,31&32 Financial Dist,Nanakramguda ,Hyderabad-500032

Hero MotoCorp Ltd Company Management

Director NameDirector DesignationYear
Pawan Munjal Chairman & CEO 2022
Pradeep Dinodia Director 2022
Suman Kant Munjal Director 2022
Vikram S Kasbekar Whole-time Director 2022
Jagmohan Singh Raju Independent Director 2022
Tina Trikha Independent Director 2022
B.S. Dhanoa Independent Director 2022
Rajnish Kumar Independent Director 2022
Vasudha Dinodia Director 2022
Camille Miki Tang Independent Director 2022
Dhiraj Kapoor Company Secretary 2022

Hero MotoCorp Ltd Listing Information

Listing Information
NIFTY
BSE_500
BSE_100
BSE_200
BSEDOLLEX
CNX500
BSEAUTO
CNX100
CNXCONSUMP
CNXAUTO
CNX200
CNXDIVIDEN
BSECARBONE
NIFTY50V20
NFT100EQWT
BSEALLCAP
BSELARGECA
GOODSSERVI
BSEMANUFAC
NFTQULTY30
SENSEX50
ESG100
LMI250
BSEDSI
NFT50EQWT
NFT100LV30
BSE100LTMC
NFTYLM250
NFTY200Q30
NF500M5025

Hero MotoCorp Ltd Finished Product

Product NameUnit Installed
Capacity
Production
Quantity
Sales
Quantity
Sales
Value
Motor Cycles-Two Wheelers No 00024917.15
Spares NA 0002895.89
Income from Services NA 000595.39
Other operating revenues NA 000427.66

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