New Delhi: Hero MotoCorp Ltd, India’s biggest two-wheeler maker by sales, has received approval for its electric scooter to be a part of the ₹25,938 crore production-linked incentive scheme for automobiles and auto parts (PLI-Auto), according to the scheme’s portal.
The approval from testing agencies came on 8 July for the VIDA V2 Pro model, which allows the company to claim incentives from the ministry of heavy industries.
The approval makes Hero MotoCorp the fourth electric two-wheeler maker in the PLI roster, after Ola Electric Mobility Ltd, TVS Motor Co. Ltd, and Bajaj Auto Ltd.
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The PLI-Auto scheme has been integral to boost the margins of electric vehicle makers in the country.
Vivek Anand, chief financial officer, Hero MotoCorp Ltd, said during the company’s earnings call on 14 May that its efforts to reduce Bill of Materials (BOM) costs through localization, along with the PLI benefit that the company will receive, will make the company’s operations profitable.
In the process of applying
He said then that the company is in the process of applying for PLI sops for multiple models, and was expecting an approval by July.
Hero MotoCorp is the 17th company to get its models approved under the scheme, and has initiated the process to get other models approved.
Hero MotoCorp recorded a 175% rise in sales of its electric Vida scooters to reach 48,674 units during the year, Mint reported in May, citing data from the Federation of Automobile Dealers Associations (FADA).
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The company had a 4.2% market share among electric two-wheelers in FY25, according to the Vahan portal, the central registry of vehicles.
Disbursals under the PLI-Auto scheme have been low, with about ₹322 crore doled out to approved companies in FY25. While 16 companies had been approved for PLIs before Hero MotoCorp, only four had received these payouts till FY25.
Tata Motors and Mahindra & Mahindra were granted about ₹246 crore in January 2025, followed by ₹73.74 crore to Ola Electric in March. The ministry of heavy industries said on 26 March that Toyota Kirloskar Auto Parts had also received disbursals, but did not disclose the amount.
An uptick is expected in FY26, union heavy industries minister H.D. Kumaraswamy told Mint in June.
Nine cos to make PLI claims
The minister had said the government is expecting PLI claims worth about ₹2,000 crore from nine companies in FY26.
Under the marquee scheme to support the production of zero-emission vehicles, manufacturers receive 13-18% of their incremental sales as kickbacks.
Manufacturers have to procure at least 50% of the components locally.
While key manufacturing components such as cells for electric vehicles have to be imported, others can be sourced from Indian auto components makers.
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Manufacturers also have to meet investment targets under the scheme, or face removal, according to PLI-Auto guidelines. Incumbent vehicle makers must have annual revenues of at least ₹10,000 crore and invest ₹3,000 crore in fixed assets. For component makers, the thresholds are ₹500 crore in revenue and ₹150 crore in investment.
New entrants from outside the auto sector need a global net worth of ₹1,000 crore and must commit investment over five years.
The continued addition to the roster of PLI-approved auto products comes as sales of electric vehicles have risen about 17% in FY25 to over 1.9 million, compared with about 1.6 million in FY24.