BUY HERO HONDA MOTORS - MOTILAL OSWAL

Motilal Oswal is bullish on Hero Honda Motors and has recommended buy rating on the stock in its October 4, 2010 research report.

“Hero Honda Motors posted September 2010 volumes of 433,461 units (versus estimate of 470,000), up 8% YoY (2.1% MoM). Volumes were impacted by floods in North India (including at its plant in Uttarakhand), disrupting the movement of goods. As a result the company is carrying inventory of ~35,000 units across its plants. Although short-term headwinds exist, the outlook seems buoyant. Anil Dua, Sr VP (Mktg) said: "The record sale in H1 of FY11 is extremely encouraging. We introduced two new bikes this month. Leading into the festive season, we have lined up a couple more launches. With this slew of launches, high-decibel communication and activation, we are confident of doubling our pace of growth during the festive season."

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