Discover Top 6 listed electric vehicle companies in India: learn before investing

Top 6 listed electric vehicle stocks in India

Top 6 listed electric vehicle Stocks – Industry Overview:

Top 6 listed electric vehicle stocks in India – Electric vehicle is a buzzword that keeps everyone engaged, from the government to consumers, from OEMs to Component manufacturers, from 4-wheelers to 2-wheeler manufacturers across the globe. Everyone is thinking about which model to choose from, how many kilometre one vehicle can move on one single charge, is it electric vehicles are good for highways or long drives or it is only confined to city drive? A lot of questions moving around. However, we will discuss the top 6 listed electric vehicle stocks in India where one can invest for the long term.

Rapid urbanization, poor air quality in the city, and increased fuel bills drive the demand for electric vehicles across the globe. Countries want to be independent of fuel price fluctuation and an Electric vehicle is the best solution. Governments across the world are pushing for CO2 reduction. Though India is in the very early stage of this evolution, the Indian Government had laid out ambitious plans for this segment well ahead of Electric Vehicles adoption. We aim to identify the top 6 electric vehicle stocks in India where one can invest for the long-term. To that end, we need to understand how the government of India is incentivizing this industry.

The government has budgeted ~INR 44038 crore as production-linked incentives to local manufacturing units in automobiles in FY 2022. The PLI scheme for the automotive industry intends to promote high-tech green manufacturing such as electric and hydrogen fuel cell vehicles. About INR 25,938 Crores scheme announced for Automobiles and auto components and INR 18,100 Crores announced for Advance chemistry cell (ACC) battery.

In addition, individual state governments across India are also preparing a draft of the Electric Vehicle Policy for the next five years to incentivize this segment of the automobile sector. Apart from analyzing the top 6 electric vehicle stocks, we will also separately analyze the top 6 electric vehicle companies that manufacture components or infrastructure for electric vehicles.

According to a KPMG report, the country is forecasted to be home to 102 million Electric vehicles (EVs).  The growth is currently being led by two-wheeler (2W), three-wheeler (3W), and bus segments. Thus, there is a strong potential for all-electric vehicle manufacturers including OEMs and component manufacturers need to develop appropriate business models to facilitate a robust EV ecosystem. The top 6 electric vehicle stocks in India include companies that manufacture both 4-wheelers and 2-wheelers. The trend of total electric vehicle registration in India has been growing over the months of 2022 – refer to the chart below.

Top 6 listed electric vehicle stocks in India
Data Source: Vahan.paravahan.gov.in

Our intention in this article is to analyze the Top 6 listed electric vehicle companies across segments of this industry. Let us jump to that.  

Top 6 listed electric vehicle stocks: 3 are from 4-Wheeler and CV segments

Tata Motors Share:

Tata Motors is one of the leading providers of electric vehicles in India. The company captures ~70% share in EV retail sales in fiscal 2021. Tata Motors has been focusing on launching new EV models in the coming years.  The models in the pipeline are Nexon EV long-range/ coupe, Altroz EV, Punch EV, Sierra EV, and Harrier EV. The company is the pioneer in launching the cheapest EV model “Tiago EV” in India at the cost of INR 8.5 lakhs to INR 11.79 lakh.

Tata Motors is also targeting 50000 EV sales in fiscal 2023. The company is also planning to scale it to 125-150k units annually in the next two years. Tata is the largest electric car seller in India sold 19,106 units of electric vehicles in FY 2022 which is ~352 percent more than the FY2021. Tata motor is well ahead of other peers in this segment and hence my top pick. Apart from electric vehicles, the company is into other segments of the Automobiles Industry such as passenger cars, Buses, Trucks, etc. Tata motors is my favorite stock among top 6 listed electric vehicle stocks in terms of its volume of sales unit and valuation Parameters.

Mahindra & Mahindra Share:

Mahinda & Mahindra is also not far behind Tata Motors in terms of EV manufacturing. The company lined up new EV models. Mahindra has lined up five new electric Sports Utility Vehicles (SUVs) to launch in the years 2024 to 2026. The company was one of the pioneers in the EV vehicles segment when it acquired REVA electric company. Mahindra & Mahindra has one of the largest numbers of electric vehicles in its portfolio. Mahindra eVerito is the first electric sedan in India.

The company also manufactures three-wheelers in the EV segment. EVerito, eSupro, Treo, Treo Zor, eAlfa mini, and e2o plus are some of the EV models manufactured by the company. The company is planning to launch its first electric SUV “XUV400” in early 2023. Mahindra group also committed to investing over INR 4000 crores in electric sports utility vehicle space in a partnership with British International investment. The total capital infusion will be between FY 2024 and 2027. The company is planning to sell ~25% of all its SUV sold will electric by 2027.

Along with the top 6 listed electric vehicle stocks, I would like to suggest to read more about top listed logistic stocks in India such as Allcargo Logistics, Container Corporation of India Ltd. (CONCOR), Aegis Logistics.

Ashok Leyland Share:

Ashok Leyland – the major commercial vehicle player – is coming up with its aggressive electric vehicle plans. The company – through its UK-based electric mobility arm Switch Mobility – launched its first electric bus platform named “SWITCH EiV 12” in India. Currently, Ashok Leyland is planning to make electric buses for intra-city or inter-city mobility. These buses will come to market by December 2022. The company has already got an order for 2000 buses. Ashok Leyland is planning to invest ~US$150-200 million via its subsidiary Switch Nobility.

Apart from the electric vehicle segment, Ashok Leyland is a market leader in M&HCV in India. The company is the 4th largest bus manufacturer and 2nd largest commercial vehicle manufacturer in the world in terms of volume. Ashok Leyland’s products cater to different industries such as Defence, transportation, agriculture, construction, etc. The company is present across segments of commercial vehicles such as LCV, MCV, Buses, Goods carriers, Small commercial vehicles, Tipper, Tractors, and Haulage.

The company also manufactures power generators such as Agricultural, Marine, and Industrial engines, and Diesel generators. This is the flagship company of the Hinduja group. Good for long-term investors. In the commercial vehicle segment, Ashok Leyland is the most important stock among the top 6 listed electric vehicle stocks to be invested in.

Top 6 listed electric vehicle stocks valuation parameters -4-Wheelers / CV

All numbers
are for
FY 2022
ProductsTotal
Revenue
(INR Crs.)
Market
Cap
(INR Crs.)
Net Profit
(INR Crs.)
ROE
%
ROCE
%
Debt
to
Equity
Ratio
PEEPS
PB
Tata MotorPassenger cars
Commercial
Vehicles
278453144,324-11234-22.31.43.13-12.54-36.42.94
M&MPassenger cars
Commercial
Vehicles
93,545.23157,6626,577.3214.211.31.5822.8758.22.65
Ashok
Leyland
Commercial
Vehicles
26,772.9944,811-2921.686.253.28-122.26-1.225.1

Top 6 listed electric vehicle stocks: 3 are from the 2-Wheeler segment

Hero MotoCorp Share:

Hero MotoCorp is the market leader in the 2-wheeler segment in India. The company launched its first model of electric vehicle in India under its Vida brand. Hero MotoCorp is a strong brand in rural India. The company planned a three-pronged EV strategy. Hero MotoCorp has over 36% stake in electric scooter maker Ather Energy. The company is also planning to retail Ather’s scooters in its outlets, along with looking at other collaborations to expand its domestic EV footprint.

Hero MotoCorp has also partnered with Taiwan’s Gogoro on battery swapping & EV scooters to expand its footprint across the value chain of the EV two-wheeler market. Apart from the EV segment, the company is present across the segments of the two-wheeler market domestically as well as globally. Hero MotoCorp is one of the best stocks among the top 6 listed electric vehicle stocks.

TVS Motors Share:

TVS Motor Company, the second largest two-wheeler manufacturer in India, has set aside Rs 1,000 crore to push the electric vehicle in FY 2023. The company is doubling its EV vehicle production capacity to reach 25000 units per month by the end of 2022 and to 50000 units by 2023. This is a huge investment. The company has been expanding in an organic and inorganic way. TVS Motor also invested in the electric bike maker Ultraviolette Automotive in December 2021. TVS Motor sold 19,446 units of iQube in the first five months of FY2023

The company is an early entrant into the EV segment, launched its first vehicle in iQube in January 2020, currently available in 33 cities. Apart from the EV segment, the company is also one of the leading players in the two-wheeler segment domestically. The company manufactures motorcycles, scooters, mopeds, and three-wheelers. Among the top 6 listed electric vehicle stocks, TVS Motos is my favorite due to its product portfolio.

Bajaj Auto Share:

Among the top 6 listed electric vehicle stocks in India, Bajaj Auto is one among them. Bajaj Auto is one of the leading manufacturers in India in the two and three-wheeler segment and one of the early entrants in the electric vehicle segment in India. After launching Chetak electric scooter in 2019, the company is expanding its production of electric vehicles in three-wheeler segments.

Bajaj Auto opened a new electric vehicle manufacturing facility in Akurdi, Pune with an investment of Rs 300 Cr (USD 40 Mn). The plant will have a manufacturing capacity of 500,000 EVs per annum. Bajaj currently produces around 1,000 units of the Chetak EV scooter a month. Bajaj sold ~11,815 units of Chetak in the first five months of FY2023.

Top 6 listed electric vehicle stocks Valuation Parameters – 2-wheelers

All numbers
are for
FY 2022
ProductsTotal
Income
(INR Crs.)
Market
Cap
(INR Crs.)
Net Profit
(INR Crs.)
ROE
%
ROCE
%
Debt
to
Equity
Ratio
PEEPS
PB
Hero MotoCorpTwo-Wheeler30,106.2950,680252814.418.60.0221.87115.973.17
TVS MotorsTwo-Wheeler and
Three-Wheelers
24,390.6748,07472818.411.33.4863.5215.939.51
Bajaj AutoTwo-Wheeler and
Three-Wheelers
35,824.8998,62655861923.4016.0213.083.3

Out of the above top 6 listed electric vehicle stocks both in 4-wheeler and 2-wheeler segment, I would like to invest in M&M, Bajaj Auto, and TVS motor. All these three companies are early entrants into the electric vehicle segment. These companies have strong management, brand name domestically and globally, and strong in terms of valuation. However, other companies analyzed within the top 6 listed electric vehicle stocks are strong both fundamentally as well financially to invest.

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