Brokerage firm Prabhudas Lilladher has raised its target price for TVS Motor to ₹4,650, maintaining an 'Accumulate' rating. The upgrade is driven by strong second-quarter performance, improved cost management, and the company’s focus on growing its electric vehicle and scooter segments.
Brokerage firm Prabhudas Lilladher has updated its outlook on TVS Motor Company, raising the target price to ₹4,650 while maintaining an 'Accumulate' rating. This update comes after the company reported solid results for the second quarter, leading analysts to believe that the company is well-positioned for future growth despite broader challenges in the automotive sector.
The brokerage anticipates that TVS Motor will continue to outpace the industry average in both domestic and export markets. A key reason for this positive view is the company’s ability to manage costs effectively. By using better operational methods and carefully adjusting prices, TVS Motor is working to protect its profit margins from the impact of rising raw material costs, such as steel and aluminum prices.
Looking at the company's financial growth, the report projects a strong Compound Annual Growth Rate (CAGR) for the business. Analysts expect revenue, operating profit (EBITDA), and adjusted profit after tax to grow by 17%, 18.9%, and 21.4% respectively, between the financial years 2026 and 2029. This growth is expected to be supported by the scooter segment and a rising adoption of electric vehicles (EVs) in India.
While the outlook remains positive, the electric vehicle market in India is becoming increasingly competitive. TVS Motor faces significant competition from established players like Bajaj Auto, as well as newer entrants like Ola Electric and Ather Energy. Any sudden shift in market share or a price war in the EV segment could impact the company's ability to maintain its profit margins. Additionally, the company has significant exposure to international markets, which can be affected by geopolitical tensions and currency fluctuations.
Another important part of the company’s value comes from its financing arm, TVS Credit Services. The brokerage has factored in a contribution of ₹101 per share from this unit when arriving at the revised valuation. This shows that investors are increasingly looking at the combined strength of the vehicle manufacturing business and the financial services division.
Investors may want to watch several factors closely in the coming quarters. These include the actual market share gains in the EV segment, the sustainability of margins amid raw material price changes, and the performance of international exports. Keeping an eye on how the company balances its spending on new technology and brand building with its debt levels will also be important for long-term growth.