Jefferies has revised its target price for Hero MotoCorp to ₹5,500 per share, maintaining a buy rating following the company's Q2 results, which met expectations.

The brokerage noted that while EBITDA growth was in line with estimates and reached a new high per vehicle, concerns remain regarding the company's declining market share in the two-wheeler segment and shifts in demand profiles.

Jefferies believes that the Indian two-wheeler market is set for strong double-digit growth over the next three years, contingent on the company's success in premium bikes and electric vehicles.

Nomura also issued a buy call on Hero MotoCorp, setting a target price of ₹5,805 per share.

The firm highlighted the potential for rural market improvements as a key catalyst for growth, with Q2 results showing healthy earnings growth and attractive valuations.

Nomura anticipates a 10% growth in the two-wheeler industry over FY25-26, driven by a rebalancing of growth and favorable monsoon conditions.

The brokerage noted early signs of rural recovery, which could bolster sales, especially given the company's significant rural market presence.

As the impact of electric vehicle drag diminishes with new models and the benefits from the Production-Linked Incentive (PLI) scheme materialize, margins are expected to improve.