Kotak Institutional Equities Retains ‘Add’ Rating on TVS Motor: What Does This Mean for Indian Investors?
Kotak Institutional Equities has retained its ‘Add’ rating on TVS Motor, citing multiple demand and execution levers that are expected to sustain the company’s growth momentum over the medium term. The brokerage has revised its fair value to Rs 3,950, rolling forward its valuation to March 2028.
Kotak expects TVS Motor to continue outperforming the broader two-wheeler industry, driven by a combination of domestic recovery, electric vehicle (EV) leadership, network expansion and strong export momentum. Reflecting higher volume assumptions, Kotak has raised its FY2026–28 EBITDA estimates by 4–6%.
Domestic Recovery and Electric Vehicle Leadership
Domestic two-wheeler retail volumes grew 9% year-on-year in FY26 to date, supported by strong momentum in ICE scooters and motorcycles above 125cc. Improved vehicle financing conditions and GST rate cuts post-September have further aided demand, with festive season volumes rising over 15%.
TVS Motor has significantly outperformed the domestic ICE market, registering 18% year-on-year growth in FY26 to date. This has been driven by continued market share gains in scooters and premium motorcycles — segments that are growing faster than the industry average and carry a higher mix for TVS.
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Electric Vehicle Growth and Export Momentum
TVS Motor continues to hold leadership in the electric two-wheeler space, with market share consistently above 20%. New launches such as the Orbiter, along with sustained traction in the iQube portfolio, have helped maintain momentum despite some moderation following GST changes.
EV two-wheeler retail sales grew 15% year-on-year in FY26 to date. Kotak expects industry growth to track or exceed expectations in the near term, aided by widening price differentials between ICE and EV scooters.
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Export Demand and Risk Factors
The brokerage also highlighted TVS Motor’s entry into the EV three-wheeler segment, where it has already achieved around 20,000 unit sales in FYTD26 and captured over 10% market share in the sub-5 tonne category within months of launch.
Kotak believes export demand remains robust, albeit with growth moderating beyond FY27. Export momentum is being driven by a favourable base in Africa, steady performance in Latin America, and expansion into Sri Lanka, Nepal and Bangladesh.
TVS Motor’s export volumes rose 34% year-on-year in FY26 to date, significantly outperforming industry growth of 24%.
While input cost inflation remains a key risk to monitor, the brokerage believes the balance of drivers supports sustained growth, justifying its continued ‘Add’ stance on the stock.
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Conclusion
In conclusion, Kotak Institutional Equities’ retention of its ‘Add’ rating on TVS Motor is a positive sign for Indian investors. The company’s strong domestic recovery, electric vehicle leadership, and export momentum are expected to drive growth in the medium term.
However, investors should also be aware of the potential risks, including input cost inflation and moderating export growth beyond FY27.
As always, it’s essential to do your own research and consult with a financial advisor before making any investment decisions. To learn more about Investing in Indian Stock Market, please click on this link.