TVS, Eicher Motors hit 52-week highs on healthy growth prospects

Compared to a 6% increase on the Sensex, shares of TVS Motor and Eicher Motors have increased up to 20% apiece in the past month.

In Tuesday’s intraday trade on the BSE, shares of two-wheeler manufacturers were in demand, with TVS Motor Company and Eicher Motors trading at their respective 52-week highs on the anticipation of robust rural demand supported by favourable rabi output, an increase in crop prices, and the opening of schools and colleges.

In terms of individual stocks, TVS Motor topped its previous high of Rs 885.85 set on July 1, 2022, reaching a record high of Rs 888.80, up 1%. In today’s intraday session, Eicher Motors increased by roughly 2% to a new 52-week high of Rs 3,088. These equities have increased by up to 20% apiece over the past month, while the S&P BSE Sensex has only up by 6%.

The market for two-wheelers throughout the world is still growing due to consumer desire for affordable, sustainable mobility options. The availability of semiconductors will return to normal and commodity costs are predicted to soften, which will help satisfy demand. Long-term market growth is anticipated because to factors including improved technology, increased fuel efficiency, improved driving comfort, and less environmental impact.

Domestic motorbike and moped markets, which have recently underperformed, are forecast to resume growth, with some vigour anticipated in rural agriculture-driven sectors. However, the business is optimistic about the success of the scooter category given the significant improvement in India’s urban markets, according to TVS Motor.

According to the company’s FY22 annual report, this sector will see substantial demand from students and working women, and the broader replacement segment is projected to do better in accordance with the reopening of schools, universities, and offices. Despite the global problems and a challenging business climate, the company is optimistic about beating the industry because of the robust product lineup, unwavering emphasis on consumers, quality, and affordability, as well as the great new launches, it noted.

While 2W demand increased QoQ in Q1, the sense we got was that motorcycle demand was stronger than scooter demand. This is because consumers’ preferences have shifted to motorcycles as a result of rising fuel prices, and because ICE scooter demand has been marginally impacted by the transition to electric scooters.

TVS, Eicher Motors hit 52-week highs on healthy growth prospects

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