Target: ₹2,800
CMP: ₹2,419.70
Despite moderating growth momentum in the domestic 2W industry post-festive, we expect TVS Motor’s EPS CAGR to remain robust at 27 per cent over FY25E-27. TVS Motor is benefiting from its focus on ‘growth categories’ of scooters, premium motorcycles and exports, continued market-share gains (especially in scooters, exports), as well as from the sustained margin expansion (with PLI benefits also being reflected Q4-FY25 onward).
The company has strengthened its presence in high-growth segments like premium motorcycles, scooters, and exports, driven by sustained consumer insight-led innovations (identifying growth categories, consumer preferences, incubating and growing multiple new brands – a rare industry phenomenon).
We highlight TVS Motor’s continued outperformance sustaining even in recent months (also reflected in vahan retails) as well as its strong positioning in E-2Ws (generally one of the top-2in the last few months). After the recent 10 per cent correction in stock price, TVS Motor trades at 27x Dec-26E core PER.
We maintain Buy on TVS Motor and our TP of ₹2,800 at unchanged 30x Dec-26E PER + ₹180/sh for the captive financing arm.
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