Hero MotoCorp Plans to Enter Electric Three Wheeler Segment

This move could mark the Pawan Munjal-led firm’s entry into the rapidly expanding and fragmented segment, putting it in competition with Mahindra & Mahindra (M&M) and Bajaj Auto.

September 04, 2024. By Aishwarya

Hero MotoCorp (HMC) has been in ongoing negotiations to make a significant strategic investment in Altigreen Propulsion Labs, according to a media report.

This move could mark the Pawan Munjal-led firm’s entry into the rapidly expanding and fragmented segment, putting it in competition with Mahindra & Mahindra (M&M) and Bajaj Auto. Hero is expected to invest up to INR 900 crore for a stake in the 11-year-old company, according to the report.

Altigreen would gain a major investor capable of helping it scale rapidly and expand its presence in key markets, if the deal proceeds. For Hero MotoCorp, this investment would represent a diversification into the E3W segment, a market where rival Bajaj Auto has already established a foothold and which is dominated by M&M.

If the deal gets finalised, this would be Hero’s second significant investment in an EV manufacturer. The company currently holds a 40 percent stake in electric two-wheeler maker Ather Energy, having invested INR 124 crore in June for an additional 2.2 percent stake. This funding round took place at a valuation of INR 5,636 crore, up from INR 4,666 crore when HMC initially invested INR 140 crore in December of the previous year.

Altigreen, which identifies itself as a technology company, reported a turnover of INR 115 crore and sold 2,800 units in the 2024 financial year. The company has been in discussions with Hero for nearly six to nine months. To date, it has raised USD 56 million (INR 470 crore) between seed and Series A investments, although the valuation remains undisclosed.

Series A was led by Sixth Sense and Xponentia and included contributions from Reliance Industries, Accurant (US), and Momentum (Singapore).

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Sustainable Transport

Hero MotoCorp

Altigreen Propulsion Labs Pvt Ltd

Electric three wheelers

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Electric vehicle supply chain

Electric Vehicles

Electric Vehicle Hub

Electric vehicle charging stations

Electric vehicle adoption

Investment round