TVS Motor to benefit from 'scooterisation' and premiumisation; Check analyst price targets

Shares of TVS Motor Company Ltd., which settled nearly 3% lower on Tuesday, will continue to remain in focus after the company reported results that were largely in line with estimates.

Morgan Stanley maintained an 'Overweight' rating on the stock with a price target of ₹4,022, citing that Q2FY26 results were in line at the EBITDA level, though margins were slightly below expectations.

The brokerage expects scooterisation and premiumisation to remain key growth drivers in the two-wheeler segment, with TVS well-positioned to benefit from both.

It added that the company continues to "race ahead", delivering on growth, market share, and margins.

Jefferies also retained a 'Buy' rating with a price target of ₹4,300. The brokerage said Q2 EBITDA and PAT grew 40-44% year-on-year, broadly in line with expectations.

Volumes rose 23% YoY, while EBITDA margin was stable sequentially at 12.7%. EBITDA per vehicle rose 1% QoQ to a new high.

Jefferies expects industry volumes to grow at a 10% CAGR over FY25-28, with TVS's market share climbing to a 22-year high in domestic two-wheelers and a record level in exports. It projects a 16% volume CAGR and 27% EPS CAGR over FY25-28E.

Nomura too maintained a 'Buy' rating with a price target of ₹3,970, citing expectations of outperformance across segments. It said that Q2 margins were slightly below estimates due to lower PLI benefits and forex impact, but said the EV 3W ramp-up and Norton launch could offer potential upside.

Nomura estimates strong 14% volume growth in H2 and sees margins expanding further on operating leverage.

Citi, however, remained cautious, retaining its 'Sell' rating with a price target of ₹2,750. The brokerage said GST cuts could lift demand and new launches may aid growth, but added that high valuations versus peers and rising competition could limit upside.

Key things to watch out for

- Festive demand trends and FY26 outlook

- Progress on e-mobility initiatives and demand traction

- Incremental investments in subsidiaries

- Export ramp-up in new markets