Bajaj Auto vs Hero MotoCorp: Q4 FY26 metrics snapshot

Why these two-wheeler results moved the stocks

Shares of Hero MotoCorp Ltd and Bajaj Auto Ltd rose as much as 6% in Thursday’s trade after the two-wheeler makers reported their March-quarter results. Hero MotoCorp gained 5.57% to an intraday high of ₹5,458 on the BSE. Bajaj Auto advanced 4.10% to a high of ₹10,738.40 per share.

The rally followed strong bottom-line growth and shareholder-return announcements. Bajaj Auto reported a 34% jump in Q4 net profit, announced share buybacks of up to ₹5,633 crore, and declared a dividend of ₹150 per share. Hero MotoCorp reported a 30% surge in net profit and declared a dividend of ₹75 per share.

A separate trading datapoint in the provided dataset puts Bajaj Auto’s latest trading price at ₹10,633 as of 07 May at 13:39.

Valuation reset: P/E ratios moved in opposite directions

The five-year valuation trend in the dataset shows Bajaj Auto’s P/E ratio rising while Hero MotoCorp’s P/E compressed. Bajaj Auto’s P/E ratio increased from 21.9 in March 2021 to 30 in March 2025, implying a 6.50% CAGR over five years. Hero MotoCorp’s P/E ratio moved from 20 in March 2021 to 17 in March 2025, implying a -3.20% CAGR over five years.

This divergence matters because the same sector backdrop is producing different valuation outcomes, likely reflecting differences in business mix, profitability expectations, and market positioning as perceived by investors.

Market capitalisation: Bajaj pulled further ahead

Market-cap growth in the dataset also favours Bajaj Auto over the same five-year period. Bajaj Auto’s market capitalisation increased from ₹106,246 crore in March 2021 to ₹219,898 crore in March 2025, a 15.66% CAGR. Hero MotoCorp’s market capitalisation increased from ₹58,238 crore to ₹74,446 crore over the same period, a 5.03% CAGR.

The gap in market capitalisation is a key reason why the two stocks can react differently to similar operating developments, including changes in volumes, exports, and product mix.

Quarterly topline: March 2026 vs December 2025

On revenue, the dataset shows stronger sequential growth for Bajaj Auto in the March 2026 quarter. Bajaj Auto’s revenue for Mar ’26 was ₹19,726 crore versus ₹16,640 crore in Dec ’25, representing 18.55% growth. Hero MotoCorp’s revenue for Mar ’26 was ₹13,188 crore versus ₹12,784 crore in Dec ’25, representing 3.16% growth.

The sequential comparison highlights a sharper pickup for Bajaj Auto in this snapshot, although the dataset does not provide unit volumes or segment-level breakup to explain the drivers.

Operating performance: EBITDA improved for both

EBITDA also rose sequentially for both companies in the dataset. Bajaj Auto’s EBITDA for Mar ’26 was ₹4,969 crore compared with ₹4,089 crore in Dec ’25, a 21.53% increase. Hero MotoCorp’s EBITDA for Mar ’26 was ₹2,079 crore compared with ₹1,930 crore in Dec ’25, a 7.74% increase.

Hero MotoCorp also reiterated its medium-term EBITDA margin guidance of 14%-16%, but did not assure even a minimum 14% margin for FY27.

Profit trend over eight quarters

The dataset provides an eight-quarter net profit change for both companies. Bajaj Auto’s net profit increased from ₹1,941 crore to ₹3,492 crore over eight quarters, representing a 34.11% CAGR. Hero MotoCorp’s net profit increased from ₹1,032 crore to ₹1,473 crore over eight quarters, representing a 19.50% CAGR.

These figures indicate faster profit compounding for Bajaj Auto in the period covered, based on the data provided.

Dividends: payout ratios and latest announced dividends

Dividend payout ratios moved differently across FY21 to FY25 in the dataset. Bajaj Auto’s dividend payout declined from 88.95% in March 2021 to 71.94% in March 2025, a -4.16% CAGR over five years. Hero MotoCorp’s dividend payout increased marginally from 70.77% to 71.58% over the same period, a 0.23% CAGR.

For the latest announced shareholder returns mentioned in the text, Bajaj Auto declared a dividend of ₹150 per share and a share buyback of up to ₹5,633 crore. Hero MotoCorp declared a dividend of ₹75 per share.

Key financial snapshot table

Earlier quarterly comparison: Q3 FY25 numbers

The dataset also includes a Q3 FY25 comparison table. In that quarter, Hero MotoCorp reported net profit of ₹1,203 crore on revenue from operations of ₹10,211 crore, with EBITDA of ₹1,279.58 crore and an interim dividend of ₹100 per equity share. Bajaj Auto reported net profit of ₹2,108.7 crore on revenue from operations of ₹12,807 crore, with EBITDA of ₹2,481.06 crore; no interim dividend was shown in the table.

Brokerage views and targets tracked in the dataset

Brokerage commentary in the text leaned positive on Bajaj Auto after the results. Axis Direct raised its target price on Bajaj Auto to ₹11,410 from ₹10,790 and retained a ‘Buy’ rating, citing multi-cylinder growth triggers, export rebound, disciplined three-wheeler and EV scale-up, and improving financial services performance through BACL. ICICI Securities increased its Bajaj Auto target to ₹12,000 from ₹11,150, stating the operational performance was above its estimate and adding that export momentum would anchor growth.

On Hero MotoCorp, HDFC Institutional Equities maintained a ‘Buy’ rating with a target of ₹6,657 after the company reiterated its medium-term EBITDA margin guidance. YES Securities expects Hero MotoCorp to deliver 7% volume growth over FY26-28, driven by new launches and exports. Another note in the text maintained an ‘ADD’ view with a revised target of ₹5,915, while Nuvama retained ‘Buy’ with a target of ₹6,000. PL Capital also carried an ‘accumulate’ view with a target of ₹6,300.

Market impact and what investors are tracking

The immediate market reaction was tied to earnings momentum and announced capital returns, with both stocks moving sharply on the day. For Bajaj Auto, the combination of profit growth, buyback size (₹5,633 crore), and dividend (₹150 per share) became central to the post-result narrative in the dataset. For Hero MotoCorp, the market response reflected profit growth and the dividend announcement (₹75 per share), alongside management’s margin guidance stance.

Valuation and market-cap trends in the dataset provide additional context for investor positioning. Bajaj Auto’s higher P/E by March 2025 and its faster market-cap CAGR suggest the market has been willing to pay up for its growth and scale in the period covered, while Hero’s lower P/E trend signals a more conservative valuation multiple.

Conclusion

Bajaj Auto and Hero MotoCorp saw strong post-results moves after reporting March-quarter performance and announcing dividends, with Bajaj also announcing a buyback. The next set of market checkpoints in this comparison will likely be follow-through on margin guidance, sequential revenue and EBITDA trajectory, and any further updates from brokerages on targets and ratings.