Hero Electric Vehicles has announced the first part of its Series B funding of Rs 220 crore. Gulf Islamic Investments (GII) led the round along with participation from OAKS.
Hero Electric to set up multiple plants
Hero aims to sell over 1 million units per year
Hero Electric, which has retained its title of the No. 1 e-two-wheeler OEM in the first-half of 2021, plans to use the new funds towards expanding production capacity, further strengthen market leadership, invest in technology and also grow its footprint across India-like markets.
To achieve speedy growth and double sales every year, the company plans to make significant additions to its manufacturing capacity by setting up multiple plants over the next couple of years. It has also said that it will also focus on India-centric, flexible, and cost-effective innovations that will drive the growth of electric mobility which is in line with making India the EV hub of the world.
“The EV market has undergone tremendous change over the last few years since we raised our first round of funding. The policies are extremely conducive for the growth of the segment and despite the pandemic, the company is poised to grow at over 2X from the last fiscal. Hero aims to sell over 1 million units per year in the next couple of years. This round of investments, which is a first of a larger scheme, will help expand our manufacturing capacities and increased R&D spends that will enable us to continue to launch innovative products to disrupt the category. Hero is committed to its mission of – no emissions and building a sustainable future that is electric,” said Naveen Munjal, Managing Director, Hero Electric.
Pankaj Gupta, founding partner and Co-CEO of GII, commented, “We are delighted to be a part of the growth journey of India’s market-leading electric vehicles pioneer – Hero Electric – through our latest round of investments under India Growth Portfolio II. As a sustainability conscious and visionary investor, GII has observed the growing role of EVs in mitigating environmental pollution and the opportunities it presents in India, one of the world’s most populous countries and an important investment destination in the firm’s global strategy.”
Over the past 14 years, Hero Electric has sold over 3,50,000 EVs, helped grow the EV ecosystem and infrastructure and re-skilled 6,000 mechanics across India. Since 2011, the company has launched over 15 electric two-wheelers manufactured at the plant in Ludhiana. Hero Electric currently has around over 700 sales and service touch-points spread across the country.
The electric two-wheeler market in India is witnessing good traction, particularly in the past few months. This market sentiment has been helped by the recent 50 percent increase in FAME II subsidy and also a flurry of new products, both from established players and entrees into the segment.