Hero MotoCorp on Thursday said it has forayed into the electric three-wheeler segment by taking a 32.5% stake in Euler Motors for Rs 525 crore.
"Our strategic investment in Euler marks a bold move towards achieving our dream to be a leader in the mobility future," Hero MotoCorp Executive Chairman Pawan Munjal said in a regulatory filing.
The decision highlights the company's desire to drive growth through organic and inorganic growth, while focusing on teamwork and flexibility in a fast-changing market, he said.
"As we expand and deepen our footprint in the changing mobility ecosystem, this investment allows us to access the growing markets for electric three and four-wheelers, along with creating new business avenues," Munjal said.
The firm has reaffirmed that its board approved an investment of a maximum of Rs 525 crore in Euler Motors Private Limited to be done in one or more tranches. The investment will give Hero MotoCorp a significant foray into the expanding electric three-wheeler space, which is predicted to contribute 35% of overall sales in the near future.
Euler Motors, which has operations in 30 cities in India, is engaged in the design, manufacture, sale, and service of electric three-wheelers. The company has recently introduced its first electric commercial four-wheeler. Euler Motors posted a turnover of Rs 172 crore for the year ended March 31, 2024.
Hero MotoCorp has said its holdings in Euler would be about 32.5% fully diluted. Apart from this, Hero MotoCorp has the option of buying existing Euler shareholders' stake through secondary sale as a part of total investment.
The stock of Hero MotoCorp on Thursday closed at Rs 3,596.90, higher by 1.73% on the BSE.
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