Hero MotoCorp Andhra Pradesh investment: ₹3,200 cr

Investment plan anchors Hero MotoCorp’s next phase in Andhra Pradesh

Hero MotoCorp, India’s largest two-wheeler manufacturer, has outlined a fresh investment push in Andhra Pradesh, targeting expansion across manufacturing, logistics and electric mobility. Executive Chairman Pawan Munjal said the company plans to invest ₹3,200 crore in the state over the next three to five years. The commitment comes as the company looks to strengthen its supply chain and increase production capacity at its Tirupati facility. The announcement was made during a select media interaction in New Delhi, alongside the laying of the foundation stone for a new parts facility in Tirupati. Munjal also pointed to supportive state policies under Chief Minister Chandrababu Naidu as a key factor behind the renewed focus on Andhra Pradesh.

The investment figure also aligns with a Reuters report that Hero MotoCorp would invest more than 32 billion rupees in Andhra Pradesh. Within this broader plan, the company is earmarking a sizeable portion for a new global parts centre. The company’s stated intent is to convert Tirupati into a larger manufacturing and electric mobility hub, while reinforcing its role in global supply operations.

Tirupati to get a second Global Parts Centre (GPC 2.0)

A central piece of the plan is the establishment of the company’s second global parts centre, referred to as GPC 2.0, at Tirupati. Hero MotoCorp said the project involves an investment of ₹750 crore. Munjal said the facility will support supplies of parts to other global markets and also expand the company’s accessories and merchandise business. The foundation stone for the Tirupati GPC was laid on Wednesday.

Hero MotoCorp already operates its first global parts centre at Neemrana in Rajasthan. The Tirupati facility is positioned as the second such node, intended to deepen the company’s parts distribution capability. In practical terms, it adds a dedicated infrastructure layer for parts, accessories and related merchandise, which can influence service levels and turnaround times for both domestic and export-linked channels. The company’s messaging around the centre also emphasises supply chain resilience, especially as product portfolios widen across scooters, motorcycles and electric offerings.

Manufacturing expansion: capacity to rise from 0.6 million units

Alongside the parts centre, Hero MotoCorp plans to increase annual production capacity at its Tirupati plant. Munjal said the facility currently has a capacity of about 0.6 million units. The company plans to take this up to 1.2 million to 1.5 million units. He noted that the company has a large campus in Tirupati with scope for expansion.

The capacity ramp is expected to require substantial investment as part of the overall ₹3,200 crore commitment. While timelines for the full capacity range were not detailed beyond “soon”, the stated target implies a doubling of installed capacity at the lower end, and up to 2.5 times at the upper end. For Hero MotoCorp, higher throughput at a single site can also improve logistics planning and reduce complexity as parts and finished vehicles move across domestic and potential export networks.

Employment impact: around 4,000 opportunities linked to Tirupati expansion

Hero MotoCorp said the Tirupati expansion is expected to generate around 4,000 employment opportunities. The figure is linked to the combined scale-up underway at the facility, including manufacturing expansion and the new global parts centre. Munjal framed the expansion as one that would generate “substantial employment” alongside increased capacity.

Employment commitments are also a significant element of how large investments are assessed at the state level, particularly when industrial policy aims to attract long-duration manufacturing projects. For Hero MotoCorp, staffing requirements can rise not only with assembly lines but also with warehousing, packaging, quality, inbound and outbound logistics, and parts operations associated with a global distribution centre.

Why Andhra Pradesh: policy environment cited as business-friendly

On the rationale for enhancing investment in Andhra Pradesh, Munjal said the current state government’s policies for the economy and various industries are “very conducive” to more investment. He described the policy environment as business-friendly and said that this was a key factor in the company’s return to the state with larger investment plans.

The company also acknowledged that it had earlier committed to scaling up investment in Andhra Pradesh, but further plans were delayed due to the COVID-19 pandemic. Hero MotoCorp has already invested around ₹1,600 crore in the state, including a manufacturing unit in Tirupati in 2018. The latest plan represents a recommitment, with a defined investment envelope and a clearer set of operational deliverables.

FY27 capex: ₹1,500 crore for EVs, scooters, and new launches

Separately, Hero MotoCorp has also outlined a capital expenditure plan of over ₹1,500 crore for FY27. The stated focus areas include expanding capacity in electric vehicles and high-growth scooter segments, while preparing for new product launches. The company said scooter production capacity is being doubled to meet demand, and it is accelerating its EV strategy under its Vida brand.

As part of EV readiness, the company is preparing to double EV manufacturing capacity at its Sri City plant in Andhra Pradesh. It also said it has expanded scooter capacity in specific models, including a 50% capacity increase for the Destiny scooter and plans to double production of its ICE scooter model, Zoom. Beyond capacity, the FY27 investment plan also includes support for new launches across EVs, premium motorcycles, and scooters, and investments in brand building and digital technologies.

Parts, accessories and merchandising: strengthening the aftermarket play

In addition to the ₹750 crore GPC 2.0 at Tirupati, the provided information also refers to an investment plan of over ₹700 crore to set up a second global PATH (Parts, Accessories, and Merchandising) centre in southern India. The intent described is to strengthen Hero MotoCorp’s aftermarket and accessories business.

Taken together, these announcements underline that Hero MotoCorp is placing greater emphasis on parts availability, merchandising, and service support as part of its broader manufacturing footprint. For investors tracking operating performance, aftermarket initiatives often matter because they can support brand stickiness and service ecosystem strength, even though the company has not disclosed revenue impact figures in the provided material.

Key facts at a glance

Market impact: what the investment signals for operations and positioning

The Andhra Pradesh investment plan signals a push toward higher scale at an existing manufacturing base and a stronger parts network that can serve multiple markets. A higher-capacity Tirupati plant can support volume growth in categories where the company is expanding, while the global parts centre is positioned to improve parts flow and availability. From an operational standpoint, parts infrastructure can also support service quality and reduce downtime in distribution, which matters for two-wheeler ownership experience.

The EV references are also notable because Andhra Pradesh features repeatedly in the company’s manufacturing roadmap, including planned EV capacity expansion at Sri City. While the company has not shared model-level output projections in the provided material, the combination of EV manufacturing expansion and parts ecosystem strengthening reflects a broader build-out of capabilities rather than a single-plant upgrade.

Analysis: why this matters for Hero MotoCorp’s next cycle

Two themes stand out from the disclosures. First, Hero MotoCorp is pairing capacity additions with supply-chain infrastructure, which indicates a focus on execution and distribution readiness rather than only adding assembly lines. Second, Andhra Pradesh is being used as a key operating base for both ICE and electric initiatives, spanning manufacturing and parts logistics.

The investment timelines are also structured over multiple years, which spreads execution and capital deployment. The company has explicitly linked the renewed investment momentum to improved policy comfort after earlier delays caused by the pandemic. Future updates to watch, based on what has been announced, include milestones for the Tirupati capacity ramp, commissioning timelines for the GPC 2.0, and the pace at which EV manufacturing capacity is doubled at Sri City.

Conclusion

Hero MotoCorp’s ₹3,200 crore plan for Andhra Pradesh over three to five years brings together a ₹750 crore global parts centre at Tirupati and a capacity expansion that could lift the plant from 0.6 million units to 1.2 million to 1.5 million units annually. The company expects around 4,000 employment opportunities from the Tirupati expansion. Separately, its FY27 capex plan of over ₹1,500 crore highlights continued focus on EVs, scooters, and new launches, including a plan to double EV manufacturing capacity at Sri City. The next set of signals will likely come from execution updates on the parts centre build-out and the commissioning phases linked to the Tirupati capacity increase.