Home / Companies / News /  TVS Motor's EV plans gather pace, brokerages bullish on stock
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TVS Motor while announcing its quarterly earnings also said that its board approved the incorporation of a wholly owned subsidiary to undertake its electric mobility business. The company indicated that it would be creating a separate subsidiary for the EV business to enhance flexibility, scale and focus towards this vertical.

Shares of TVS Motor were trading over 6% higher at 615 per share on the BSE in Friday's opening session after the company posted a 29% rise in consolidated net profit at 234 crore for the second quarter ended September.

"The company plans to have a monthly capacity for 10k units for EVs by 4QFY22 and indicated aggressive capacity expansion plans in FY23. We see these steps to be in the right direction which could potentially lead to further value unlock and capitalization on the electrification shift. This should be further supported by a series of new launches to expand the overall electric portfolio in the coming quarters," said Nirmal Bang in a note.

The brokerage said that it acknowledges impending risks of disruption in the two-wheeler space (especially scooters), but views TVS to be well-positioned with a credible EV strategy at play. 

It expects TVS to continue to outperform industry, led by an improving brand franchise, robust demand outlook and significant headroom for margin expansion. Nirmal Bang's Buy rating comes with a target price of 660 apiece on supportive outlook and as EV strategy gathers pace.

TVS Motor Company said it has reported highest ever revenue of 5,619 crore in the second quarter as against 4,605 crore in the year-ago quarter, registering a growth of 22%.

“We maintain our positive stance on TVS as new product launches will aid in increasing volumes, with countries now opening up, exports are likely to improve, receding fear of 3rd wave in India can possibly pent-up demand in upcoming quarters and cost reduction efforts and price hikes will aid in protection of margins," said analysts at Prabhudas Lilladher. 

The brokerage has maintained its ‘Buy’ with a target price of 682 as TVS remains its preferred pick in the 2W space.

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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