Tesla, BYD to Tata Motors: How should Indian investors play the EV theme? Experts explain the right strategy

Gas prices spiked this year, and Tesla just had its best Q2 ever with deliveries up 25%. So the story can be: oil goes up, people buy EVs, So, should we consider investing EV stocks now?

“One should be careful about the betting on EV stocks based on that theory,” asserts Viram Shah, Founder & CEO, Vested Finance.

“Tesla reports these great numbers, and the stock falls about 7.5% the same day. Its worst day in nearly a year. So sales went one way and the share price went the other,” he says and that this is not really an aberration, as a carmaker's delivery numbers and its stock performance do not always move in tandem.

“And the oil shock part? That's a spike. The Strait of Hormuz situation is already easing, pump prices are coming down from the May highs. So, if your reason to own an EV stock is that gas is expensive this month, that reason can disappear next month. That's timing a headline, not investing.”

What should you consider before investing in EV stocks?

EV adoption globally is a structural, decade-long shift and it's not one company. It's Tesla, it's BYD, which actually still outsells Tesla on pure EVs, it's the battery and charging supply chain.

“If that long-run theme interests you, the real question is access and how you size it, not whether to chase this quarter's fuel prices,” Shah advises.

The access part is going to get easier. From India, you can get exposure to these global names directly, fractionally, starting small and you are not forced to take a big single-stock bet to participate.

So in case you are plannig to invest in EV – the stratey should not be “oil's up, buy EVs,' rather you should think like – this is a global theme, hence I want a measured slice of, and how do I get it cleanly and keep it diversified,” advises Shah.

What about investing in Indian EV stocks?

No matter how the prices move, the first thing that can be considered is the fact that India imports around 85% of its crude oil, which automatically makes petrol and diesel expensive. This fact makes EVs — Tata Motors, Mahindra, and Ola Electric – and the stocks attractive, as they become cheaper to own and run over the long term

Also, government incentives and India's clean energy goals continue to encourage EV adoption, says Santosh Meena, Head of Research at Swastika Investmart. “However, rupee depreciation, higher battery/raw material import costs, and macro slowdown risks (subsidies under pressure, slower rural demand) limit the upside.”

Hence, investors should focus on financially strong Indian EV companies with a solid manufacturing base, rather than relying only on global EV stocks, while hedging currency and policy volatility. “Overall a tactical opportunity aligned with India's energy security push, not a broad "buy" signal,” Meena said.