At a Glance (Excerpt Only)
TVS has turned from “moped guy” to “market’s biker boy” — delivering 28% CAGR profit and 50% stock return over 5 years. But with a PE over 60 and market cap nearing ₹1.4 lakh crore, is this high-performance machine priced for perfection?
📊 1. Financial Performance (FY21–FY25)
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 | 5Y CAGR |
|---|---|---|---|---|---|---|
| Revenue (₹ Cr) | 19,421 | 24,355 | 31,974 | 39,145 | 44,089 | 19% |
| Net Profit (₹ Cr) | 608 | 731 | 1,309 | 1,779 | 2,380 | 28% |
| Operating Profit (₹ Cr) | 2,232 | 2,755 | 4,027 | 5,500 | 6,575 | 30% |
| ROE (%) | 12.5% | 15.9% | 27.9% | 35.5% | 47.1% | 🔥 |
| OPM (%) | 11% | 11% | 13% | 14% | 15% | Expanding |
| EPS (₹) | 12.5 | 15.9 | 28.0 | 35.5 | 47.1 | 🚀 |
🛠️ Fun Fact: TVS tripled its profits in just 3 years. No “EV disruption” visible here — they are the disruption.
🔧 2. What’s Driving This Engine?
- 🔋 Electric Push: iQube electric scooter expanding globally — Indonesia, Congo, maybe Mars next?
- 🛠️ Full Spectrum: Only Indian OEM active across motorcycles, mopeds, and scooters — mass + premium
- 🌍 Exports Matter: Strong foothold in Africa, SE Asia. HLX brand in Congo outsells many Indian EVs 😮
- 🏍️ Premiumization Strategy: Apache RTR 200 4V, Ronin, and now OBD2-compliant lineups
🧱 3. Risks Under the Hood
- 🧨 Valuation: PE of 62.7x is double Hero, Bajaj, and Eicher – even if you throw in EV premium, this is a luxury ride
- 🧾 Debt Load (Still): While it has reduced debt from ₹26,000 Cr (FY24) to ₹14,676 Cr (FY25), it’s still substantial
- 📉 Low Dividend Yield: 0.34% – stock is priced like it’s 2040 already, but pays like it’s 2004
- 💡 High Working Capital Days: Over 100 days – a red flag when most OEMs work on tighter cycles
🛻 4. Peer Comparison
| Company | PE | ROCE (%) | OPM (%) | PAT (₹ Cr) | Sales (₹ Cr) | CMP / BV |
|---|---|---|---|---|---|---|
| TVS Motor | 62.7 | 19.4 | 14.9 | 2,380 | 44,089 | 16.3 |
| Hero MotoCorp | 19.7 | 31.2 | 14.1 | 4,376 | 40,923 | 4.5 |
| Bajaj Auto | 32.0 | 28.1 | 18.7 | 7,325 | 50,995 | 6.7 |
| Eicher Motors | 32.3 | 29.8 | 25.0 | 4,734 | 18,870 | 7.2 |
💸 Takeaway: TVS gives the lowest margins but demands the highest valuation. Basically, it’s a Dominar price for a Star City ride.
🔋 5. EV Narrative — Real or Hype?
- iQube = over 600,000 targeted units globally by FY26
- EVs now contribute ~14–15% of scooter volumes
- International rollout is aggressive, but pricing competitiveness with Ola/Ather is still questionable
🧠 Clever play: TVS is not betting only on EVs — they’re bundling ICE + EVs as parallel lanes, unlike Ola which is stuck in one charging slot.
💰 6. Valuation & Fair Value (EduInvesting Estimate)
Let’s go by PE valuation for FY25 EPS = ₹47.06
- Conservative PE: 35x = ₹1,647
- Optimistic EV+Premium PE: 45x = ₹2,118
- Peak optimism: 50x = ₹2,353
📉 FV Range: ₹1,650 – ₹2,350
📈 CMP: ₹2,917
🎯 Overvalued by ~25% at current levels
🤔 7. Final Verdict:
If Hero is the “Papa ki bike” and Bajaj is “Hamara Bajaj”, then TVS is now “Premium se bhi Premium hai bhai”.
But the valuation is priced like they already outsold Tesla in Indonesia, Congo, and Neptune. While fundamentals are strong and growth is real, investors may want to wait for a dip — or for PE to take a chill pill.
🚨 Unless you’re buying purely on “EV ki kasam” – you might be riding a Harley at Splendor margins.
✍️ Written by Prashant | 📅 June 26, 2025
Tags: TVS Motor, iQube scooter, two-wheeler stocks, EV stocks India, Hero vs Bajaj vs TVS, Nifty Auto, overpriced auto stocks, EduInvesting
