Buy TVS Motor Company; target of Rs 2774: Geojit Financial Services

Geojit Financial Services is bullish on TVS Motor Company has recommended buy rating on the stock with a target price of Rs 2774 in its research report dated November 08, 2024.

Broker Research

November 08, 2024 / 12:29 IST

Buy

26 Aug, 2025 12:21

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Geojit Financial Services research report on TVS Motor Company

TVS Motors (TVS) is the third largest two-wheeler manufacturer in India, with a domestic market share of 17.9% in FY24. TVS recorded the highest quarterly revenue for Q2FY25, with a growth of 13% YoY on the back of strong volume growth, a superior product mix, and better realization. The margin came in line with our estimate, up 88bps, supported by softening raw material prices and cost control initiatives. TVS continued to outperform and gained market share in retail growth. To strengthen its 2W electric sales, TVS has lined up several models for FY25 and plans to sell 25,000 units per month. We anticipate domestic rural demand to remain strong, driven by favourable monsoons and better crop yields. Expansion of exports, particularly for premium vehicles and electric vehicles, will further boost demand. Despite cautious industry optimism, TVS is confident to outperform and deliver growth. We believe, the stock is likely to trade in premium owing to its diversified product category and new launches in EV.

Outlook

TVS is poised to maintain a competitive edge in innovation and product engineering by introducing customer-centric products early and outperforming its peers. This trend is mirrored in the expansion into European and Latin American markets with the Norton brand. Considering the cautiousness in industry margin, we value TVSM's standalone business at 36x FY26E EPS (Rs2,682/share) and TVS Credit Services at Rs.92/share (15% holding dis.) to arrive at a target price of Rs.2,774/share and recommend Buy rating at CMP.

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