On Friday, TVS Motor Company Limited (TVSL:IN) received a positive adjustment from JPMorgan, with its stock rating being upgraded from 'Neutral' to 'Overweight'. The firm also increased the price target for the company's shares to INR 3,050.00, marking a significant rise from the previous target of INR 2,300.00.
The upgrade comes after a period of observation where TVS Motor's retail market share has demonstrated resilience, maintaining approximately 17% despite competitive pressures from rivals such as Honda (NYSE:HMC) and new entrants in the electric vehicle (EV) sector like Ola.
JPMorgan anticipates that TVS Motor will soon begin a new model cycle that includes both EV and internal combustion engine (ICE) two-wheelers, as well as an EV three-wheeler.
The initial downgrade earlier in 2024 was due to concerns over increasing competition. However, TVS Motor's market share stability has led to a revised outlook, with expectations of market share gains as the company launches new models.
Exports, which account for 24% of the company's revenues, have also shown signs of recovery, with an 11% year-over-year increase in the first four months of the fiscal year 2025.
JPMorgan anticipates that consensus earnings per share (EPS) will be revised upwards, driven by two main factors: anticipated volume increases due to the new launch cycle and the inclusion of Production Linked Incentive (PLI) scheme benefits for the company's EVs, which have not yet been accounted for in comparison to its peers.
Consequently, JPMorgan has increased its EPS estimates for fiscal years 2026-2027 by 5-18% and raised the price target for TVS Motor by 32% to INR 3,050.00, leading to the upgrade in the stock's rating to 'Overweight'.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.