TVS Motor is becoming more valuable than its Hero MotoCorp counterpart

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  • Shares of TVS Motor are up 71% in 2022 so far, while Hero MotoCorp has only gained 3% in the period.
  • With this, TVS Motor’s market capitalization stands at ₹51,078 crore, a bit more than Hero MotoCorp’s market value of ₹51,069 crore.
  • TVS Motor said it had a strong start to the holiday season and demand is expected to pick up further during the season.
  • Analysts believe that TVS Motor has been doing well for a few years in terms of sales and is venturing into the electric vehicle space.

Chennai-based automaker TVS Motor Company has taken a major step by becoming more valuable than its nearest competitor, Hero MotoCorp.

All thanks to a strong rally in shares of TVS Motor this year – they have jumped 71% so far in 2022, while those of Hero MotoCorp have gained only 2.4% during the period.

With this, TVS Motor’s market cap soared to ₹51,078 crore, slightly more than Hero MotoCorp’s market value of ₹51,069 crore.

TVS expects demand to remain strong through the holiday season
When announcing its September sales numbers, the company said it had a strong start to the holiday season and demand is expected to pick up further as the season progresses.

Analysts believe that TVS Motor has been doing well for a few years in terms of sales, especially after venturing into the electric vehicle (EV) space.

“The past two years have been good for TVS Motor as many of their new products have been successful, their three-wheeler sales have also been very strong. faster than the other two companies – Hero MotoCorp and Bajaj Auto at present,” said Piyush Parag, Assistant Vice President – Research at Sharekhan by BNP Paribas.

The boom in electric vehicle sales has also contributed to TVS Motor’s growth. In September this year, it sold 4,923 units of TVS iQube Electric compared to 766 units in September 2021.

On the other hand, its competitor Hero MotoCrop arrived late to the EV party. It launched its first electric scooter VIDA V1 only in October. The sector already has established players like Ather Energy and Ola Electric.

Moreover, it is also more vulnerable to industry-wide downturn. “If an industry as a whole isn’t performing well, Hero MotoCorp will be the hardest hit as it has the largest market share in the two-wheeler space. The past two years haven’t been great for Hero MotoCorp since Covid-19 happened as the entry level segment and the executive segment did not perform well,” Parag said.

Adding to Hero MotoCorp’s woes, in March this year, there were reports that the income tax department had detected bogus expenses of up to ₹1,000 crore made by the company.

TVS Motor Shows Overall Strength Despite Export Issues
TVS Motor has global footprints in countries including the Middle East, Africa, Southeast Asia, Indian Subcontinent, Latin America and Central America.

However, its export sales did not fare well due to the difficult economic environment around the world.

The company’s total exports fell in September 2022 with sales of 92,975 units compared to sales of 1.02 lakh last year. “On the international markets front, there is marginal improvement, however, challenges related to the economic slowdown and rising inflation persist. We are cautiously optimistic that sales momentum will continue to improve. “, said the company.

Strong sales in other segments managed to offset slower export sales of TVS Motor, which manufactures the widest range of two-wheelers, ranging from mopeds to scooters and commuter motorcycles to race-inspired bikes. .

Latest sales figures September 2022 (in units) September 2021
Two wheels 3.61 lakh 3.32 million
three wheels 17,282 14,645
Exports 92,975 1.02 lakh
EV (TVS iQube electric) 4,923 766
Globally 3.79 million 3.47 million

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