TVS Motor Company Limited is gradually reducing the retail market share gap with Ola Electric Technologies Pvt. Ltd. in the electric two-wheeler (e-2W) segment. The latter holds the top spot with a market share of 24.8% in March followed by TVS with 19.5% share, as per the Vehicle Registration data.
This is the second consecutive decline in Ola’s market share. Kumar Rakesh, analyst at BNP Paribas Securities India, said that in terms of volume share, Ampere Vehicles was the biggest gainer, while Ola was the biggest loser in March. This is the likely reason for the price cut by Ola, Rakesh said in a report dated April 10. Ola slashes the price of the S1 Pro electric scooter 5,000 at the end of FY23. However, it is valid till April 16 only.
On the other hand, TVS’s market share has increased for the sixth time in a row in March. The company’s electric scooter, the iQube, continues to grow. In the March quarter (Q4FY23), iQube constituted 5% of TVS’ total two-wheeler wholesale volumes, up from 3.5% in Q3.
“This is a sign of consumer confidence in existing brands as electric vehicle customers look for superior quality and reliability. TVS is likely to overtake Ola in terms of market share in the medium term, provided the ongoing momentum is maintained, said Varun Baxi, an analyst at Antique Stock Broking.
Overall, the e-2W’s share of the total two-wheeler market stood at around 6% in March, the highest in FY23. This indicates a good start to FY24.
For FY23, e-2W penetration grew approximately 260 basis points year-on-year to 4.5%. There is scope for further improvement as companies are enhancing existing products and launching new ones.
The BNP Paribas report said, “We see deliveries of the Ola S1 Air starting in July and the launch of two electric two-wheeler models by Honda in FY24 as the next positive catalysts for e-2W sales and mix.” Are.”
To be sure, eventually when government incentives disappear, demand may take a hit as affordability becomes an issue. Thus, how the e-2W market shapes up is an important factor to watch.
For now, other listed companies, Bajaj Auto Ltd and Hero MotoCorp Ltd, do not have a significant market share in e-2Ws. An increase in traction for investors in the shares of these two companies will be a key trigger. In the case of TVS, its increasing penetration in the e-2W segment is one of the reasons which has boosted investor sentiment. TVS stock is currently trading at its 52-week high 1176.90 per share in October was seen.
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