TVS Motor Q3 Results Review – Yes Securities Reiterates As Preferred Pick Among 2Ws, Revises Target Price Yes Securities NDTV Profit

TVS Motors currently trades at 34.5 times/28.8 times of FY26/FY27 EPS (versus Hero MotoCorp / Bajaj Auto of 15-19x on FY27 EPS). We believe, it should continue to trade at premium as we expect EPS CAGR of ~22.7% over FY24-27E.

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Yes Securities Report

TVS Motor Company Ltd. Q3 FY25 results was in-line as flat average selling price QoQ and YoY at ~Rs 75,000/unit (estimate Rs 75,500/unit) as expected as price hikes remained negligible with product mix too remained stable. Muted ASP was also led by launch of iQube 09 variant at lowered price point.

However, margins continue to be resilient at 11.0% (+70bp YoY/ +20bp QoQ). Gross margin expanded ~210 bp YoY (flat QoQ) at 28.4%. Key operating metrics such as Ebitda/vehicle remain elevated at ~Rs 8,900/unit (+6.3% YoY/ +1.5% QoQ).

The management indicated rural/semi-urban markets are performing better vs urban in 9M FY25 and even in Q3. We continue to believe TVS Motor is better placed among two-wheeler OEMs both in ICE and EVs led by better product acceptability which should drive further market share gains. However, we would remain watchful of the TVS Motor’s market share in the 125cc segment and market share thereof.

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