Synopsis
Jefferies maintains a positive outlook on India's two-wheeler market, buoyed by tax cuts. However, they express concerns over Ola Electric's declining market share, while TVS and Bajaj Auto show strong performance.Key Takeaways
- Positive outlook for the two-wheeler market in India.
- Expected 13% CAGR from fiscal 2024-2027.
- Concerns over Ola Electric's shrinking market share.
- TVS Motor Co. shows double-digit growth.
- EV penetration stagnates at 4-7%.
New Delhi, Feb 19 (NationPress) Global brokerage Jefferies expressed a positive outlook on the two-wheeler market in India, particularly following recent income tax reductions in the Union Budget aimed at enhancing consumption.
As per the firm’s analysis, registrations of two-wheelers in India saw a growth of 4-5 percent in January and the initial half of February, buoyed by a robust performance in fiscal years 2022-24.
Jefferies forecasts a 13 percent compound annual growth rate (CAGR) for the two-wheeler sector from fiscal year 2024 to 2027, which equates to a moderate 3 percent CAGR over the extended period from fiscal year 2019 to 2027.
According to Jefferies, the local industry is witnessing varied growth trajectories among companies, with TVS Motor Co. leading with double-digit growth and an increase in market share.
However, Hero MotoCorp Limited and Bajaj Auto Limited are falling behind in domestic growth, the note indicated.
The brokerage raised alarms regarding Ola Electric, pointing to its diminishing market share.
In the electric two-wheeler segment, Ola Electric's share has plummeted from 49 percent in the June 2024 quarter to merely 17 percent in the first half of February 2025.
Moreover, the penetration of electric vehicles (EVs) in the two-wheeler category has remained stagnant at 4-7 percent over the last two years, despite the introduction of more affordable models by various original equipment manufacturers (OEMs).
Jefferies commented that while lower ownership costs render EVs appealing, widespread acceptance is still contingent on consumer trust in product reliability, durability, and resale value.
On a positive note, Bajaj Auto and TVS Motor have emerged as formidable competitors, each capturing a market share of 22-26 percent during January-February, according to the brokerage.
Data from the government’s VAHAN portal indicates that Ather Energy also gained momentum, with its market share climbing to 14 percent in December from 11 percent the previous month, marking a 3 percent increase.
