TVS Motor (TVSL IN) Hold: Stronger push for R&D to drive future growth

Research evidence excerpt

TVS Motor (TVSL IN) Hold: Stronger push for R&D to drive future growth

14 May 2026

TVS Motor (TVSL IN) EquitiesAutomobiles

Hold: Stronger push for R&D to drive future growth India

◆ Management expects EVs, scooters, and premium MC to

MAINTAIN HOLD

sustain growth, while economy segment struggles in FY27

TARGET PRICE (INR) PREVIOUS TARGET (INR)◆ TVS plans 1.5m-unit capacity expansion (INR10bn capex)

and enhanced R&D (INR5bn) in FY27 4,000.00 4,000.00

◆ However, valuations not undemanding; hence, we retain our SHARE PRICE (INR) UPSIDE/DOWNSIDE

Hold rating and INR4,000 TP 3,527.20 +13.4%

(as of 13 May 2026)

TVS reported a 4QFY26 EBITDA margin of 13.1%, flat q-o-q and ahead of 12.7% MARKET DATA

Market cap (INRm) 1,675,279 Free float 41%

consensus, despite elevated commodity cost inflation. While we expect commodity Market cap (USDm) 17,517 BBG TVSL IN

headwinds to persist into 1QFY27, TVS appears better positioned than peers to 3m ADTV (USDm) 36 RIC TVSM.BO

implement price increases, supported by its premium portfolio. TVS continues to gain

FINANCIALS AND RATIOS (INR)

market share across segments, with overall share up 170bp y-o-y to 19.2% in Year to 03/2026a 03/2027e 03/2028e 03/2029e

FY26 (scooters +220bp to 26.9%; motorcycles +110bp to 10.9%), and we expect this HSBC EPS 76.09 92.69 105.73 122.19

HSBC EPS (prev) 76.68 90.08 103.50 na

momentum to continue as scooteriation and electrification (both market-share Change (%) -0.8 2.9 2.1 na

accretive for TVS) gather pace. However, we expect margins to remain muted in Consensus EPS 76.5 92.6 112.6 - PE (x) 46.4 38.1 33.4 28.9

FY27 due to commodity pressures and higher initial costs from capacity expansion, Dividend yield (%) 0.3 0.3 0.3 0.3

EV/EBITDA (x) 26.0 22.4 19.2 16.3

before improving in FY28. ROE (%) 34.2 33.3 28.7 25.8