TVS Motor, Bajaj Auto, Ashok Leyland hit all-time highs; what's powering gains in these stocks?

Even as the auto pack was facing uncertainty amid huge inventory pile with the indsutry body, Nifty Auto index has gained ground in Friday's session. Last at the time of writing this copy at around 12:33 pm, Nifty Auto index was up over 1 per cent even as the bluechip Nifty index traded with modest gains.

Amid the sharp rally, some three stocks namely TVS Motor, Bajaj Auto and Ashok Leyland have marked their fresh all-time highs in trade today.

TVS Motor

TVS Motor shares last traded at Rs 2,797.95, up 3.4 per cent or Rs 92, after hitting a new record high of Rs 2,818. The stock in the last one year has gained 107 per cent. On Thursday, the company has announced the launch of its new TVS Jupiter 110 cc scooter at the starting price of Rs 73,700 ex-showroom.

After the launch, the company's stock has been upgraded by JP Mogan to overweight from the previous neutral and with a raised target of Rs 3050. The new set target implies a potential gain of nearly 13 per cent. The brokerage said that the company's retail market has remained resilient despite a resurgence by Honda as well as aggression in EVs by Ola. We expect consensus EPS upgrades as the company will resume its launch cycle increase FY26-27E EPS by 5-18 per cent, added the brokerage.

Meanwhile, UBS has continued with its buy stance on the counter and raised target to Rs 3,200, suggesting an upside of over 18 per cent. The brokerage believes that the company's new Jupiter can further aid 15-20k additional volumes (ie c30-40% growth over outgoing model).

Bajaj Auto 

Bajaj Auto has also marked its fresh all-time high today of Rs 10,373.35 and last traded higher with gains of over 4 per cent at Rs 10,339.4. The gains in the stock after global brokerage JP Morgan said it prefers 2-wheeler companies with diversified revenue sources and market share gains.Further, it is bullish on TVS Motor and Bajaj Auto, while it has given a cautious view on Eicher Motors.

JP Morgan on 2-wheeler companies 

JP Morgan in its note on 2-wheeler companies said it is perhaps the most attractive segment in the Indian auto industry. The brokerage expects volumes to grow at 8 per cent CAGR in FY24-27. Furthermore, JP Morgan held that the segment will outperform all others in the industry as current inventory and strong demand give out positive signals. 

Also, even though the electric 2-wheeler segment is registering slow growth, the segment is unlikely to see pressure on margins.

JP Morgan also highlighted that despite Ola's significant market share in the EV market, both the companies are fast catching up in market share through new launches and expansion of distribution channels.
 

E-2W Market Share

Company             FY23               FY25 YTD
OLA                        21%                    44%
TVS Motor           11%                     16%
Bajaj Auto            4%                       13%