Buy TVS Motor; target of Rs 5050: Anand Rathi

Moneycontrol • 3 days ago

Original source

Key Investment Pillars

  • Solid demand in 2W (domestic/exports): Led by GST relief and attractive financing options, TVS Motor is expected to outpace industry growth.
  • Rebound in African markets and expansion into new markets: Africa is a key driver, supported by LatAm and Asia, with momentum expected to continue.
  • Market share gain: Both in domestic and export markets, driven by new launches and market penetration.
  • Relentless EV strategy: With a broader EV product pipeline, including premium scooters, sports bikes, and commuter space, TVS Motor aims to expand its EV offerings.

Thesis Validation Checklist

To validate the thesis, watch for:

  • Volume growth: TVS Motor's ability to clock 12% CAGR over FY26-29e, outpacing industry growth.
  • Margin expansion: Rising economies of scale and cost-cutting measures leading to margin expansion, despite near-term commodity pressure.
  • EV momentum: Continued growth in EV sales and profitability, driven by scale and new variants.
  • Market share: TVS Motor's ability to gain market share in domestic and export markets. These signals will indicate whether the investment thesis is playing out as expected.