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Informist, Wednesday, Sept. 16, 2026

 

MUMBAI – Kotak Securities Ltd.'s research arm, Kotak Institutional Equities, has upgraded estimates for key financial metrics of Bajaj Auto Ltd. and TVS Motor Co. Ltd. for the coming few years on the back of robust uptick in exports of two-wheelers. Yet, the firm has retained its "sell" rating on Bajaj Auto and "add" rating on TVS Motor, as per its report Tuesday. "We expect TVS (Motor) to outpace Bajaj (Auto) as incremental growth skews toward Africa, where TVS carries higher saliency," Kotak Securities said.

 

The firm has increased its earnings before interest, tax, depreciation, and amortisation estimate for TVS Motor for 2026-27 (Apr-Mar), FY28, and FY29 by 2-5% assuming higher sales volume in India and overseas and a marginal growth in the average selling price of their vehicles. "The company continues to outperform in the domestic ICE (internal combustion engine) segment; we expect newer launches in EVs (electric vehicles) and ICE to aid it in gaining market share," Kotak Securities said of TVS Motor. The company's volumes may grow at a compounded annual growth rate of around 12% over FY26-FY29 while revenues may grow between 16-17% in the same period, Kotak Securities said.

 

The Chennai-based auto-maker's medium-term growth prospects are strong because of a strong growth in sales of their electric two-wheelers, steady demand for two-wheelers running on conventional fuel, and improving brand franchise in the export markets, Kotak Securities said. TVS Motor's export growth momentum is expected to sustain in FY28 because of a gain in market share in Latin America, opening up of imports into Sri Lanka, strong end-customer demand in Africa, and other key markets.

 

Kotak Securities has increased Bajaj Auto's standalone earnings per share estimate for FY27-FY29 by 4-5?cause of potential growth in exports. The sales of Bajaj Auto's two-wheelers in India remain poor because of increased competitive intensity in motorcycles with an engine capacity of around 125 cubic centimetres, pricing war in the entry-level motorcycles that have 110-cc engines, and a lack of offerings in the burgeoning conventional fuel-run scooter segment.

 

Bajaj Auto's reliance on exports to compensate for muted domestic market performance is expected to help its financial metrics. "The company continues to scale up the EV volumes, which coupled with recovery in export volumes will aid in the overall growth in the near-term. We expect the export trends to sharply moderate as we expect demand in key markets of LatAm (Latin America) to moderate," Kotak Securities said.

 

The Pune-based auto-maker's margins are expected to remain stable because of favourable foreign exchange movement and an improvement in product mix which would be partially offset by commodity cost pressures. Bajaj Auto's sales volume is expected to grow 10% on a compound annual growth basis over FY26-FY29, Kotak Securities said.  End

 

Reported by Anand JC

Edited by Shubhayan Bhattacharya

 

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