Stocks To Buy: Nomura is bullish on auto firms with high EV exposure - Check top picks

Global Investment Banking firm, Nomura on Tuesday, October 13, said it is bullish on auto companies with higher exposure to the Electric Vehicle segment for the near-term.

In its note, Nomura estimated that auto companies with a higher EV exposure, competitive EV products, and established EV technology should be better placed to grow well ahead of the industry in the second half of the current financial year and for the entire financial year 2028.

Hence, stock returns over the next few years will likely depend on EV penetration of original equipment manufacturers (OEMs) as a key variable, Nomura said.

Within OEMs, Nomura has highlighted Ather Energy, Mahindra & Mahindra, and Hyundai Motor India as its top picks on which it has a "buy" recommendation, based on the rising EV penetration theme.

It also expects Tata Motors PV to gain market share in case its EV penetration rises faster. However, the firm has a "neutral" rating on the stock.

Auto suppliers in general should benefit from rising EV penetration given the higher price points and scope to increase content, Nomura said.

Within suppliers, Nomura "buy" recommendation is on Sona BLW Precision Forgings given its higher EV powertrain content.

Nomura said it has a "buy" rating for Exide Industries as well, which commissioned its NMC cell plant in September 2026, and may also benefit in the long-term.

On another note, on Monday, CLSA said it sees an attractive risk-reward opportunity in the auto sector after the Nifty Auto index corrected around 17% over two months, despite robust retail demand momentum.

CLSA attributed the same to concerns regarding profitability amid commodity inflation and a valuation de-rating as growth normalizes post the GST rate cuts.

It said several OEMs were trading at compelling valuations, even under conservative assumptions for the next fiscal which factor in the potential persistence of commodity inflation. CLSA's preferred pick among OEMs is M&M, for which it has a "high conviction outperform" rating.

Stock reactions

Analyst Recommendations

Stock	Buy	Hold	Sell
Ather Energy	16	0	0
M&M	38	3	0
Hyundai Motor India	26	4	3
Tata Motors PV	14	8	9
Sona BLW Precision Forgings	14	4	3
Bloomberg

While shares of Ather Energy, Tata Motors and Sona BLW Precision Forgings were trading with losses, M&M and Hyundai Motor India were trading with gains on Tuesday. The losses ranged from 0.6% to as much as 2.4%, while shares of Mahindra & Mahindra, and Hyundai Motor India gained between 0.6% to 1% on Tuesday.

The Nifty Auto index traded at the flat line on Tuesday, with the winner-loser ratio being at an even keel. Seven of the 15 index constituents traded with gains, while the other eight traded lower.

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