TVS Motor Company Limited: Comprehensive Stock Analysis Report | Scrolls
- Editor
- Oct 15
- 2 min read
by KarNivesh | 15 October, 2025
TVS Motor Company Limited stands as a major force in India’s two-wheeler industry, maintaining strong growth and global reach. Over the past five years, it achieved a 19% compound annual growth rate (CAGR) in revenue and 27% in profit, driven by innovation, exports, and diversification into electric vehicles (EVs). With a market capitalization of about ₹1,69,326 crore, TVS ranks as India’s second-largest two-wheeler manufacturer. However, the stock’s premium valuation -with a price-to-earnings ratio of 71.42x compared to peers averaging 21–35x -suggests investors should tread cautiously despite strong fundamentals.
Company and Operations: Founded in 1911 and headquartered in Chennai, TVS operates manufacturing hubs in Hosur and exports to over 80 countries. The firm’s evolution from traditional motorcycles to advanced scooters and EVs underscores its adaptability. Recent highlights include record sales of 15 lakh units in Q2FY26, supported by GST reductions on two-wheelers from 28% to 18%, boosting affordability. Launches like the NTORQ 150 hyper sport scooter and international expansions in Nepal and Southeast Asia mark strategic milestones.
Financial Strength: TVS reported revenues of ₹36,309 crore in FY2025, up 14% year-on-year, and trailing twelve-month revenues of ₹46,089 crore. Net profits surged from ₹612 crore in FY2021 to ₹2,711 crore in FY2025, while earnings per share climbed from ₹12.88 to ₹57.05. The company maintains a strong return on equity (28.4%) and an improving operating margin of 14.7%. Cash flows strengthened, turning from negative ₹1,575 crore in FY2022 to positive ₹3,503 crore in FY2025, signaling better efficiency and cost management. Capital expenditure plans of around ₹1,600 crore for FY2026 will further support expansion and technology upgrades.
Segment Performance: Motorcycles contribute about 35% of revenue, led by the Apache series with 12% annual growth. The scooter segment contributes 30%, driven by the Jupiter and NTORQ series with 18% growth. Electric vehicles -primarily the iQube line -account for 10% of revenue and 35% year-on-year growth. Three-wheelers contribute 15%, showing 46% growth, while exports rose 40%. The iQube EV, offering 2.2 kWh to 5.1 kWh battery variants, positions TVS as a leader in India’s growing EV ecosystem.
Governance and Financial Health: Led by Chairman Professor Ralf Dieter Speth and Managing Director Sudarshan Venu, TVS maintains strong governance, featuring zero pledged promoter shares and a transparent management structure. Promoters hold 50.27% of shares, while foreign institutional investors (FIIs) hold 22.42%, and mutual funds 13.99%. Despite a consolidated debt-to-equity ratio of 3.25 due to EV and global investments, the firm’s interest coverage ratio of 15.2x indicates solid debt servicing capability.
Outlook and Risks: Future prospects remain robust, driven by rural market recovery, favorable GST reforms, and government incentives like the Production Linked Incentive (PLI) scheme. International expansion and the premium Norton Motorcycles partnership enhance global and luxury presence. However, risks include overvaluation, commodity price volatility, supply chain issues (especially EV components), and intense competition from rivals like Hero MotoCorp, Bajaj Auto, and Ola Electric.
Conclusion: TVS Motor combines strong growth, innovation, and sustainability, making it a standout in India’s automotive transformation. While long-term prospects in EVs and global markets are promising, the current high valuation demands cautious optimism and strategic timing for investors seeking value in a premium-priced growth story.
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