Top electric vehicle stocks to invest in india for 2024
The electric vehicle revolution is in full swing, and we’re seeing a surge of interest in electric vehicle stocks. As we look ahead to 2024, the Indian market is buzzing with potential in this sector. We’re witnessing a shift in consumer preferences, government policies, and technological advancements that are driving the growth of electric vehicles in India. This has created exciting opportunities for investors to tap into the electric vehicle stock market.
In this article, we’ll explore the top electric vehicle stocks to invest in India for 2024. We’ll take a closer look at major players like Tata Motors, Mahindra & Mahindra, and Maruti Suzuki, as well as emerging contenders in the two-wheeler and three-wheeler segments. We’ll also discuss the factors boosting EV adoption in India, potential risks associated with EV investments, and provide guidance on how to invest in this growing sector. By the end, you’ll have a better understanding of the electric vehicle landscape in India and be better equipped to make informed investment decisions.
Tata Motors Ltd
Tata Motors Overview
When we talk about electric vehicle stocks in India, Tata Motors Ltd stands out as a frontrunner. As a subsidiary of the Tata Group, a diversified business empire with interests ranging from steel to IT services, Tata Motors has established itself as the third-largest car manufacturer in India . What’s particularly interesting is that Tata Motors is also the parent company of Jaguar Land Rover, which it acquired from Ford in 2008 for $2.30 billion .
In August 2023, Tata Motors took a significant step in its EV journey by unveiling Tata Passenger Electric Mobility (TPEM), a subsidiary dedicated to electric vehicles. TPEM introduced its new brand platform and identity, TATA.ev, in partnership with strategic brand and design consultancy, Landor . This move signifies Tata’s commitment to revolutionizing the conversation around mobility and instigating a transformative shift in the car-buying experience .
Tata Motors EV Portfolio
We’re impressed by Tata Motors’ robust EV portfolio, which currently includes five models: Nexon.ev, Curvv.ev, Punch.ev, Tiago.ev, and Tigor.ev . The Nexon compact SUV has been a game-changer for Tata, helping the company achieve a dominant 73% EV market share . What’s even more exciting is that Tata plans to launch 10 new EV models by FY26, including the Curvv.ev, Harrier.ev, Sierra.ev, and the premium Avinya .
Let’s take a closer look at Tata’s EV pricing strategy. The Nexon EV, for instance, starts at about $17,363 (14.4 lakh rupees) and goes up to $23,115 (19.29 lakh rupees) before taxes and fees . This pricing is competitive, especially considering that the average car price in India is about $14,000 (11.5 lakh rupees) .
Tata Motors Financial Performance
We’re pleased to report that Tata Motors’ EV business has shown impressive financial performance. In the fiscal year 2023-24, the company’s revenues from its EV business reached Rs 9,300 crore . What’s more, the EV business turned positive on earnings before interest, tax, depreciation, and amortization (EBITDA) in the fourth quarter, achieving a 1.1% margin (excluding product development costs) .
Tata Motors has maintained its leadership position in the EV market with wholesale volumes of 73,844 units in FY24, up 47.5% year-on-year . In retail, the company enjoys a top position with a 73.1% market share, as reported on the Vahan portal .
Looking ahead, Tata Motors aims to create synergy between electric vehicles and rooftop solar (RTS). The company plans to cross-promote RTS and EVs to customers, with a goal of increasing the percentage of Tata EV users with RTS to 50% by the end of the decade, up from the current 10-15% .
With its strong market position, expanding EV portfolio, and focus on innovation, we believe Tata Motors is well-positioned to capitalize on the growing EV market in India. The company’s commitment to “Move with Meaning” and its focus on sustainability, community, and technology make it an attractive option for investors looking to tap into the electric vehicle revolution in India.
Mahindra & Mahindra Ltd
Mahindra & Mahindra Overview
When we talk about electric vehicle stocks in India, Mahindra & Mahindra Ltd (M&M) is a name that stands out. As one of the largest vehicle manufacturers in India, M&M has a rich history dating back to 1945 . We’re looking at a company that’s not just a domestic powerhouse but a global player with a presence in over 100 countries .
M&M is the flagship company of the Mahindra Group, a diverse conglomerate with interests ranging from automotive to farm equipment and technology . What’s impressive is the company’s workforce of over 260,000 employees and its annual turnover of USD 19.00 billion . This gives us an idea of the scale at which M&M operates.
In the automotive sector, M&M has carved out a niche for itself, particularly in the SUV market. They’ve achieved market leadership in SUV revenue with a 17.1% share in Q1 FY23 . What’s more, they’ve got five blockbuster SUV launches under their belt, with over 240,000 open bookings . This shows the strong demand for their products in the market.
Mahindra & Mahindra EV Portfolio
Now, let’s talk about M&M’s electric vehicle (EV) strategy. The company has been a pioneer in the Indian EV space, launching its first electric vehicle, the e2o, back in 2013 . Since then, they’ve been steadily expanding their EV portfolio.
M&M has set ambitious targets for its EV business. They’re expecting their electric SUV penetration to reach 20-30% of their overall SUV portfolio by FY27 . In numbers, that translates to volumes of around 200,000 units per annum on the upper end . This projection gives us an idea of the scale M&M is aiming for in the EV market.
To support this growth, M&M has earmarked a significant investment of ₹12,000 crore for their EV business over the next three years . They’ve also formed a dedicated subsidiary, Mahindra Electric Automobile Ltd (MEAL), to house their 4-wheeler electric passenger vehicles and related brands .
Mahindra & Mahindra Financial Performance
When it comes to financial performance, M&M has been showing strong results. In the fiscal year 2022, the company reported a standalone revenue growth of 29%, reaching ₹57,446 crore . What’s even more impressive is the 26% increase in Profit After Tax (PAT), which stood at ₹5,144 crore .
On a consolidated basis, the numbers look even better. M&M saw a 21% increase in revenue, touching ₹90,171 crore in FY22 . The PAT showed a remarkable 97% growth, reaching ₹6,577 crore .
Looking at more recent data, M&M reported a 20% growth in consolidated net profit after tax (PAT) at ₹3,283 crore for the first quarter ending June 30, 2024 . This is a significant increase from the ₹2,745 crore reported in the same period last year .
As we analyze M&M’s position in the EV market, it’s clear that the company is making strategic moves to capitalize on the growing demand for electric vehicles in India. With their strong financial performance, significant investments in EV technology, and a clear roadmap for the future, M&M is positioning itself as a key player in India’s electric vehicle revolution.
Maruti Suzuki India Ltd
Maruti Suzuki Overview
When we talk about the Indian automotive landscape, Maruti Suzuki India Ltd stands out as a dominant player. As India’s largest carmaker, Maruti Suzuki has built a reputation for producing dependable and fuel-efficient vehicles that resonate with the Indian consumer. We’ve seen the company maintain a significant market share, with popular models like the Swift, Baleno, and Vitara Brezza continuing to be favorites among buyers .
What’s particularly interesting is Maruti Suzuki’s approach to the evolving automotive market. While many manufacturers are going all-in on electric vehicles (EVs), Maruti is taking a more diversified approach. They’re not just focusing on EVs but are also exploring various clean technologies, including CNG, biogas, and ethanol . This strategy aligns with Chairman RC Bhargava’s view that offering cars with various technologies at different price points is the best approach given India’s economic conditions and resources .
Maruti Suzuki EV Plans
We’re excited to see that Maruti Suzuki is gearing up to enter the EV market. The company has announced plans to launch its first electric vehicle within the ongoing financial year . However, it’s important to note that mass production for the Indian market is likely to begin only in FY26 (April-March 2025-26) .
Maruti’s EV strategy is ambitious yet measured. They’re planning to introduce six electric vehicles in the country by FY 2030-31 . The first Maruti Suzuki EV, expected to be the production version of the eVX Concept showcased at Auto Expo 2023, is set to hit the market in FY 2024-25 . This electric SUV is rumored to be equipped with a 60 kWh battery pack and capable of offering up to 550 kms of driving range on a single charge .
Interestingly, Maruti isn’t putting all its eggs in one basket. They’re also seriously considering bringing plug-in hybrids to India, a technology that Suzuki already sells in Europe and the US . This move could offer Indian consumers a middle ground between traditional combustion engines and full electric vehicles.
Maruti Suzuki Financial Performance
We’re impressed by Maruti Suzuki’s recent financial performance, which has surpassed previous records and expectations . The company has demonstrated exceptional ability in managing costs by optimizing production operations, making supply chains more efficient, and keeping a tight lid on unnecessary expenditures .
Moreover, Maruti Suzuki has been expanding its global footprint. There has been a notable increase in the company’s exports, which has helped enhance its revenue streams from international sales . This global expansion strategy is likely to play a crucial role in the company’s future growth.
Looking ahead, Maruti Suzuki is investing heavily in research and development to stay ahead of market trends . These investments are crucial for the company to adapt to changing consumer preferences and navigate the transition to electric and hybrid vehicles.
While the company faces challenges, including potential fluctuations in commodity prices and global economic uncertainties, Maruti Suzuki’s strong market position and diversified strategy put it in a good position to navigate the evolving automotive landscape . We’re keen to see how their EV and hybrid plans unfold in the coming years, potentially reshaping the Indian automotive market.
Hero MotoCorp Ltd
Hero MotoCorp Overview
When we talk about two-wheeler manufacturers in India, Hero MotoCorp Ltd stands out as a giant in the industry. As the country’s largest two-wheeler manufacturer, Hero MotoCorp has built a strong reputation for itself . The company, headquartered in New Delhi, currently employs 9,173 full-time employees and has a diverse product portfolio that includes motorcycles, scooters, and parts .
We’ve seen Hero MotoCorp make significant strides in recent years, particularly in the 125cc segment. The company has increased its market share in this category from 13% in the fourth quarter of FY24 to an impressive 20% in Q1 FY25 . This growth demonstrates Hero’s ability to adapt to changing market demands and consumer preferences.
Hero MotoCorp EV Portfolio
Hero MotoCorp is gearing up to make a big splash in the electric vehicle (EV) market. The company has created the Vida sub-brand, which is dedicated to the EV segment . Currently, the Vida V1 electric scooter range is priced between ₹1-1.5 lakh (ex-showroom), including state subsidies .
We’re excited to see that Hero MotoCorp has ambitious plans for its EV business. The company is set to introduce three electric two-wheelers in the mass market in FY25 to strengthen its portfolio . One of these upcoming electric scooters will target customers in the B2B segment, while the other two will be positioned in the mid and entry segments for buyers in the mass market .
Hero MotoCorp’s CEO, Niranjan Gupta, has emphasized the company’s commitment to building leadership in the EV segment. He stated, “We want to build leadership in EV, and in order to do that, we will be creating a very powerful EV product portfolio, augmenting the Vida V1 Pro that we have today” .
The company is also leveraging its partnership with Zero Motorcycle to develop new electric motorcycles targeted at distinct customer segments . This collaboration is expected to expand the overall market size and strengthen Hero MotoCorp’s position in the EV space.
Hero MotoCorp Financial Performance
We’re impressed by Hero MotoCorp’s recent financial performance. In its latest quarterly results, the company reported its highest-ever quarterly revenue of INR 10,144 crores, marking a 16% year-on-year growth . The company’s EBITDA rose by 21% to INR 1,460 crores, and it achieved a record profit after tax (PAT) of INR 1,123 crores, up 36% .
Looking at more specific figures, Hero MotoCorp’s standalone net sales for June 2024 stood at Rs 10,143.73 crore, up 15.7% year-on-year . The company’s Q1 results showed a net profit rise of 36% to Rs 1,123 crore, although this figure missed market estimates .
Despite these impressive numbers, we’re aware that Hero MotoCorp faces some challenges. The impact of investments in the EV business and disruptions in the Bangladesh market have been noted as potential hurdles . However, the company remains confident in its strategy to drive growth through new product investments and enhancing market share.
As we look ahead, Hero MotoCorp is preparing for new launches, including the Xoom 125 cc and Xoom 160 cc scooters, ahead of the festive season . These launches, along with the company’s expanding EV portfolio, are expected to further strengthen Hero MotoCorp’s position in the Indian two-wheeler market.
TVS Motor Company Ltd
TVS Motor Overview
When we talk about leading two-wheeler manufacturers in India, TVS Motor Company Ltd stands out as a prominent player. As the flagship company of the TVS Group, a respected Indian conglomerate, TVS Motor has built a strong reputation in the automotive industry . We’re impressed by their diverse portfolio, which includes motorcycles, scooters, and mopeds. Some of their popular models that have captured the market’s attention are the TVS Apache, TVS Jupiter, and TVS Ntorq .
What’s particularly exciting is TVS Motor’s recent foray into the electric vehicle (EV) segment. We’ve seen them launch several electric two-wheelers, such as the TVS iQube and the TVS NTorq 125 EV . This move aligns with the growing demand for sustainable transportation options and positions TVS as a forward-thinking company in the industry.
TVS Motor EV Portfolio
TVS Motor’s commitment to the EV segment is evident in their ambitious plans and recent achievements. We’re thrilled to see that the company sold 52,000 electric two-wheelers in the first quarter of the 2024-25 financial year, a significant jump from the 39,000 units sold during the same period last year . The TVS iQube electric scooter has emerged as their best-selling electric vehicle, showcasing the brand’s ability to meet consumer demands in this growing segment .
We’re also excited about TVS Motor’s expansion plans for their EV lineup. The company recently launched a new variant of the TVS iQube with a 2.2 kWh battery, demonstrating their commitment to providing sustainable mobility options . Additionally, they’ve started deliveries of the TVS iQube ST, which is available in two variants featuring 3.4 kWh and 5.1 kWh batteries – the largest battery pack in its segment .
With these additions, the TVS iQube series now offers a total of five variants in 11 vibrant colors, making it one of the largest and most appealing EV lineups in the market . We’re impressed by TVS Motor’s strategy to cater to diverse consumer preferences and needs within the EV space.
TVS Motor Financial Performance
TVS Motor Company’s financial performance has been nothing short of impressive. In the quarter ended March 2024, we saw their revenue from operations grow by 24% to Rs. 8,169 Crores, compared to Rs. 6,605 Crores in the same quarter of the previous year . What’s even more remarkable is their highest-ever Operating EBITDA of Rs. 926 Crores for the fourth quarter, representing a growth of 36% .
Looking at the full financial year 2023-24, TVS Motor’s revenue from operations grew by 20% to Rs. 31,776 Crores . The company’s Profit Before Tax (PBT) for the year ended March 2024 saw an impressive growth of 39%, reaching Rs. 2,781 Crores .
We’re particularly excited about TVS Motor’s performance in the EV segment. Electric vehicle sales grew by 15% in the quarter ended March 2024, with 0.49 Lakh units sold compared to 0.43 Lakh units in the same quarter of the previous year . For the entire fiscal year 2023-24, EV sales saw a remarkable growth of 101%, with 1.94 Lakh units sold .
These strong financial results and growing EV sales numbers demonstrate TVS Motor’s ability to adapt to changing market dynamics and capitalize on the growing demand for electric vehicles. We’re looking forward to seeing how the company continues to innovate and expand its presence in both the traditional two-wheeler and EV markets.
Factors Driving EV Adoption in India
We’re witnessing a significant shift in India’s automotive landscape, with electric vehicles (EVs) gaining traction at an unprecedented rate. Several factors are contributing to this surge in EV adoption, and we’ll explore the key drivers behind this transformation.
Government Policies
The Indian government has been proactive in promoting EV adoption through various initiatives and policies. One of the most notable is the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME India) Scheme, launched in 2015. Currently in its second phase, the scheme has an impressive outlay of INR 10,000 Cr (USD 1.20 Bn) for a period of 5 years, with 86% of the fund allocated to create demand for EVs in the country .
Another significant initiative is the Production Linked Incentive (PLI) Scheme for the Automotive Sector, launched in September 2021 with a budgetary outlay of INR 25,938 Cr (USD 3.10 Bn). This scheme aims to boost domestic manufacturing of advanced automotive technology products and has attracted a proposed investment of INR 74,850 Cr (USD 9.00 Bn) .
The government has also introduced tax incentives to make EVs more affordable. The GST on electric vehicles has been reduced from 12% to 5%, and the GST on chargers and charging stations has been lowered from 18% to 5% . Additionally, both commercial and private battery-operated vehicles are given green license plates and are exempted from permit requirements .
Rising Fuel Prices
The increasing cost of conventional fuels has been a significant factor driving EV adoption. Between March and May 2022, gasoline prices in India increased by more than 10%, reaching record highs of over INR 120/liter (USD 5.68/gallon) . Although prices have stabilized recently, they remain historically high, making EVs an attractive alternative.
We’ve observed that EVs offer significant cost savings in terms of energy consumption. On average, electricity is 17 times cheaper than gasoline, making EVs a more economical choice for everyday drivers . The total cost of ownership (TCO) of electric two-, three-, and four-wheelers is 68%, 31%, and 23% lower than their gasoline-powered counterparts, respectively .
Environmental Concerns
Environmental considerations are playing an increasingly important role in driving EV adoption. EVs have zero tailpipe emissions, including NOx and PM2.5, which contributes to improved local air quality . This aligns with India’s commitment to reducing air pollution and addressing climate change concerns.
The shift towards EVs is expected to have a significant impact on reducing India’s dependence on fossil fuels. An electric two-wheeler, for instance, has about one-tenth the energy requirement of a comparable gas vehicle . This not only helps in reducing the country’s carbon footprint but also supports energy security.
As a result of these factors, we’re seeing a rapid increase in EV adoption across India. In some cities like Delhi and Pune, EVs now make up more than 1 in 10 vehicles registered . With the EV sector projected to grow at a 66% CAGR over the next decade , we anticipate this trend to continue, reshaping India’s automotive landscape and contributing to a more sustainable future.
Risks Associated with EV Stocks
As we delve into the world of electric vehicle (EV) stocks, it’s crucial to understand the potential risks that come with investing in this rapidly evolving sector. We’ve identified three key areas of concern that investors should keep in mind when considering EV stocks.
Technological Obsolescence
One of the most significant risks we face in the EV industry is the rapid pace of technological advancement. As battery technology improves, manufacturers are releasing higher-capacity, longer-lasting, and more energy-efficient batteries, increasing the full charge range of their vehicles . This constant innovation can lead to a form of planned obsolescence, where older EV models quickly become outdated.
We’ve seen the median range of EVs grow 3.5 times since 2011, from 73 miles in the Nissan Leaf to 247 miles in the 2022 Chevrolet Bolt . This rapid progress is great for consumers, but it poses a challenge for investors. EV companies must continuously invest in research and development to stay competitive, which can impact profitability and increase the risk of falling behind.
Competition
The EV market is becoming increasingly crowded, with both established automakers and new entrants vying for market share. We’re seeing luxury auto giants like BMW, Volkswagen, and Mercedes-Benz considering their strategies, while companies like Tesla face challenges due to their lack of entry-level vehicles and aging product lineup .
Moreover, we’re witnessing the rise of Chinese EV manufacturers, who are among the global market leaders. This influx of Chinese firms is causing concern among domestic industry players, especially as India already imports USD 20.30 billion worth of auto components, 30% of which comes from China .
The competition is particularly fierce in the mass market segments, where companies must balance pricing with range and performance to achieve pricing parity with comparable internal combustion engine (ICE) models . This intense competition can lead to price wars and reduced profit margins for EV manufacturers.
Regulatory Changes
The EV industry is heavily influenced by government policies and regulations. While current policies in India, such as the FAME India Scheme and the Production Linked Incentive (PLI) Scheme, are supportive of EV adoption, any changes in these policies could have significant impacts on the industry .
We’ve seen the introduction of new safety regulations in India to improve the performance and safety of EVs across various categories . While these regulations are necessary for consumer safety, they can also increase production costs and potentially slow down the pace of innovation.
Additionally, the lack of charging infrastructure remains a significant challenge. India lags behind other countries, with roughly 200+ EVs per commercial charging point, compared to ~20 in the US and less than 10 in China . The development of this infrastructure is crucial for widespread EV adoption, and any delays or policy changes in this area could impact the growth of EV companies.
As we consider investing in EV stocks, it’s essential to weigh these risks against the potential rewards. The EV market in India has the potential to grow more than tenfold in volume over the next 6-7 years, but realizing this potential will require navigating these challenges successfully .
How to Invest in EV Stocks
We’re excited about the potential of electric vehicle (EV) stocks in India, given the sector’s substantial growth prospects. The Indian government’s supportive policies, rising environmental awareness, and the country’s large population present a compelling investment opportunity . Here’s how we can approach investing in EV stocks:
Research
We need to stay informed about global and local EV market trends, including adoption rates, consumer preferences, and growth projections. This knowledge helps us identify companies well-positioned to capitalize on market momentum . We should analyze the financial health and business models of EV companies, examining metrics like revenue growth, profit margins, and debt levels . It’s crucial to assess a company’s advancements in EV technology, including innovations in battery technology, charging infrastructure, and autonomous driving capabilities .
Diversification
To manage risk effectively, we should spread our investments across two or three electric vehicle companies, as well as other sectors . Geographic diversification is also worth considering. For instance, we can invest in US stocks through platforms like the Appreciate App or Stockal, which allows us to benefit from the historical outperformance of US stocks and hedge against rupee depreciation .
We can also consider investing in sector-tracking ETFs or mutual funds that include US firms. These options provide diversification and can help stabilize our portfolio against rupee devaluation . Another interesting approach is investing in “Stacks” – pre-assembled collections of stocks and ETFs centered around themes like electric vehicles .
Long-term Perspective
When investing in EV stocks, we should maintain a long-term perspective. The EV market is expected to grow significantly, with EVs accounting for 18% of all passenger car sales worldwide in 2023 . By 2030, the Indian government aims for EVs to account for 30% of private cars, 70% of commercial cars, 40% of busses, and 80% of two and three-wheelers .
We should also consider the broader impact of EVs on transportation. The shift towards electric and autonomous vehicles could make transportation cleaner, safer, and less expensive in the future . This paradigm shift is likely to drive immense growth for EVs and AVs, presenting opportunities for investors who target companies across the EV and AV value chains .
Conclusion
As we wrap up our exploration of the top electric vehicle stocks in India for 2024, it’s clear that the EV market is set for significant growth. Companies like Tata Motors, Mahindra & Mahindra, and Hero MotoCorp are leading the charge, with ambitious plans to expand their EV offerings and capture a larger share of this burgeoning market. The Indian government’s supportive policies, rising fuel prices, and growing environmental awareness are key factors driving EV adoption in the country.
To invest in EV stocks, it’s crucial to do your homework, spread your investments, and keep a long-term perspective. While there are risks to consider, such as technological changes and fierce competition, the potential rewards in this rapidly growing sector are substantial. As India moves towards a greener future, investing in EV stocks could offer exciting opportunities for those willing to navigate the challenges and capitalize on the electric revolution in the automotive industry.
FAQs
- What are the top electric vehicle stocks to invest in within India?
- The article specifically highlights Tata Motors Ltd, Mahindra & Mahindra Ltd, Maruti Suzuki India Ltd, Hero MotoCorp Ltd, and TVS Motor Company Ltd as significant players in the Indian EV market.
- Are electric vehicle stocks expected to rise in India?
- Yes, the EV sector in India is anticipated to expand significantly. The automotive industry, which includes electric vehicles, accounts for about 7.1% of India’s GDP. Projections suggest that the EV market could reach USD 34.80 billion in 2024 and may grow at an annual rate of 26.05% to approximately USD 110.74 billion by 2029.
- What is the projected market share of electric vehicles in India by 2025?
- By 2025, it is expected that electric vehicles, particularly the two-wheeler (2W) segment, will achieve a market penetration of around 10%. This figure is predicted to increase to about 30% by 2030.
- What trends are expected in the electric vehicle market by 2025?
- The global electric vehicle market is set to experience substantial growth by 2025. This growth is anticipated due to technological advancements in electric vehicles, supportive government policies, and increasing consumer adoption, with forecasts from experts like Goldman Sachs indicating a significant rise in market penetration.
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