Hero MotoCorp forays into electric LCVs; buys 32.5% stake in Euler Motors

Hero MotoCorp, the country’s largest manufacturer of motorcycles and scooters, will acquire a 32.5% stake in electric three-wheeler startup Euler Motors for ₹525 crore, marking the Gurugram-based company’s foray into electric light commercial vehicle segment.

The automaker’s board has approved a strategic investment of up to ₹525 crore in one or more tranches consisting of a mix of primary and secondary investment in Euler Motors Pvt Ltd.

The primary investment would be made by Hero MotoCorp in equity shares and Series D compulsory convertible preference shares; following which HMCL’s stake would be approximately 32.5% on a fully diluted basis, the company said in a statement.

Additionally, HMCL may acquire shares from existing shareholders of Euler by way of secondary sale, it said.

Founded in 2018, Euler Motors is focused on electric commercial vehicles for last-mile cargo delivery.

This investment will provide Hero MotoCorp with a strong foothold in the fast-growing electric three-wheeler market, where EVs are projected to account for 35% of total sales in the near future, Hero MotoCorp said. As Hero MotoCorp strengthens and diversifies its emerging mobility portfolio, this strategic investment allows Hero MotoCorp to venture into a rapidly growing electric three and four-wheeler market, while unlocking adjacent business opportunities.

Euler Motors has a presence in 30 cities in India and is engaged in the designing, manufacturing and sale and service of electric three-wheelers. It last year launched its first electric light commercial four-wheelers. The Storm EV LongRange 200, priced at ₹12.99 lakh (ex-showroom Delhi), comes with a 30kWh battery for intercity usage. The Storm EV T1250, priced at ₹8.99 lakh, is for intracity usage. Both models come with a 1,250 Kg payload capacity. Euler’s turnover for the financial year ended March 31, 2024, was ₹172 crore.

Euler has a manufacturing facility in Palwal, Haryana. In FY24, the company sold 3,700 electric three-wheelers and expanded its presence from 5 to 22 cities. The company says its plant, built with an investment of ₹100 crore, has a production capacity of 36,000 vehicles annually.

“Our strategic investment in Euler is a bold step towards realising our vision to ‘Be the Future of Mobility.’ This investment reinforces our commitment to accelerated growth through both organic and inorganic expansion, while highlighting the power of collaboration and adaptability in an ever-evolving market,” said Pawan Munjal, Executive Chairman, Hero MotoCorp.

“As a global automotive leader, Hero MotoCorp is driven by sustainability, innovation and customer-centric progress. As we strengthen and diversify our presence in emerging mobility landscape, this investment allows Hero MotoCorp to venture into a rapidly growing electric three and four-wheeler market, while unlocking adjacent business opportunities and continuing to cement its leadership in the future of sustainable mobility,” said Munjal.