Anand Rathi Share and Stock Brokers Limited has released issued a BUY Call on TVS Motor Company, uplifting their target price to Rs 4,150 from Rs 3,100. Anand Rathi analysis highlights TVS Motor’s robust domestic and export volume growth, relentless EV strategy, and sustainable margin expansion—attributes that uniquely position the company in India's auto landscape. The report notes that TVS Motor’s EBITDA surged by 40% year-on-year, propelled by higher realizations and cost efficiencies, and expects impressive growth metrics through FY28.

TVS Motor: Anand Rathi Research Reaffirms BUY Rating

Research House Stance:

Anand Rathi Share and Stock Brokers Limited (ARSSBL) maintains a resolute BUY call on TVS Motor, supported by upgraded valuations and a bright multi-year growth outlook. The new target price stands at Rs4,150—signaling significant upside potential from current levels.

Key Investment Thesis

1. Robust Volume and Demand Upswing:

TVS Motor is set to capitalize on a marked upturn in the two-wheeler segment, both domestically and internationally. The brokerage expects volume expansion to be spearheaded by GST relief, improved financing availability, and favorable policy reforms. Their projection includes domestic volumes growing by 8% in H2 FY26, with the overall two-wheeler industry rising 9%—reflecting healthy rural and urban demand dynamics.

2. Strategic Electric Vehicle (EV) Push:

The company’s relentless expansion into electric mobility is underscored by a broader product pipeline targeting premium scooters, sports bikes, and last-mile delivery solutions. TVS has forged pivotal collaborations with industry stakeholders, including BMW, while investing in global e-mobility ventures like Swiss E-Mobility Group and Ego Corporation. Although the EV segment faced temporary volume restrictions due to magnet shortages, margins remain positive and are projected to improve further.

3. Margin Enhancement and Cost Leadership:

EBITDA margins have expanded year-on-year and quarter-on-quarter, reflecting the efficacy of TVS’s cost rationalization, strategic price hikes, and economies of scale. During the latest quarter, EBITDA jumped 40% to Rs15.1bn, with margin expansion of 100bps year-on-year. The firm’s focus on net-pricing, operational efficiencies, and calibrated investments in digital and financial assets further fortifies its margin outlook.

4. New Product Innovations and Market Share Accretion:

TVS Motor is witnessing a favorable response to new launches such as the Orbiter, Jupiter 150, Apache RTX, and King Cargo HD. The company is rapidly scaling up its supply chain and retail footprints—especially with premium launches like Norton poised to debut in Italy and India by April 2026.

Financial Highlights and Outlook

Financial Metrics FY24-FY28:

Target for Investors:

By valuing TVS at 38x September 2027 estimated EPS and incorporating strategic investments in TVS Credit Services at Rs135/share, Anand Rathi raises its recommended target to Rs4,150—up from Rs3,100. This signals substantial upside for long-term investors seeking strong earnings visibility and capital appreciation.

Technical Levels, Support, and Resistance

1. Price Action Snapshot:

The stock currently trades at Rs3,562, with a 52-week high/low of Rs3,704/Rs2,170. The bullish trend is corroborated by sustained momentum on robust volume, with relative price performance outpacing the broader Sensex.

2. HTML Table: Support and Resistance Levels

Key Risks to Watch

Downside Risks Highlighted:

Despite the positive posture, Anand Rathi urges vigilance around several risk vectors:

• Lower-than-expected demand in key regions due to macro volatility or regulatory shocks.
• Stiff competition from incumbent and emerging OEMs, which could pressure pricing and margins.
• Delayed product launches or failure of new offerings that threaten future market-share gains.
• Volatility in raw material prices and adverse currency movements with knock-on effects on profitability.

Analyst Certifications and Disclosure

Rigorous Standards of Objectivity:

The views are independently formulated by ARSSBL’s analysts, fully compliant with SEBI guidelines and statutory requirements. Compensation for analysts is de-linked from recommendation outcomes, ensuring robust analytical integrity across published research.