Kotak Isn't Hitting The Brakes On TVS Motor; GST Cuts, EVs, Exports Add Fuel To The Tank — Details Inside

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%.

Kotak notes that 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.

Kotak expects the company to maintain this outperformance, supported by a strong brand in scooters and premium motorcycles, along with efforts to address gaps in the premium 125cc motorcycle segment.

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.

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.

Of the 43 analysts who have coverage on this stock, and are tracked by Bloomberg, 26 have a 'buy' rating, 10 have a 'hold' call, and seven have a 'sell' rating on the stock.