According to Jefferies, the outlook for India’s auto industry in 2025 indicates divergent growth trends across key sectors, with two-wheelers and tractors projected to experience stronger growth compared to passenger vehicles and trucks in the coming years.
Jefferies forecasts a compound annual growth rate (CAGR) of 13-15 percent for two-wheelers (2Ws) and tractors over FY25-27, outpacing the expected 5-8 percent CAGR for passenger vehicles (PVs) and trucks during the same period.
This shift highlights a changing landscape in the Indian auto market, with traditional sectors like 2Ws and tractors set for stronger growth. The growth in these segments is supported by factors such as better affordability and improved accessibility, positioning them for sustained expansion in the coming years.
The stocks to watch out
Jefferies has identified Mahindra & Mahindra Ltd., Eicher Motors Ltd., and TVS Motor Co. as its top picks for 2025. These companies are expected to outperform the broader market, with Mahindra & Mahindra anticipated to gain market share across its tractor, passenger vehicle, and light commercial vehicle segments. Meanwhile, TVS Motor Co. has successfully increased its market share in both the domestic and export two-wheeler segments in recent years.
Mahindra & Mahindra Ltd.
Mahindra & Mahindra Ltd. is a leading Indian multinational in the automotive sector, renowned for its SUVs, commercial vehicles, and tractors. The company operates in diverse segments, including automotive, agriculture, and aerospace, and is known for its focus on innovation, sustainability, and providing solutions tailored to emerging markets. Mahindra’s strong presence in both domestic and international markets has made it a key player in the global auto industry.
Jefferies anticipates that Mahindra will surpass Hyundai and become the second-largest original equipment manufacturer (OEM) in passenger vehicles by FY27. The firm has set a target of Rs. 4,075 for the stock, with an upside potential of 32 percent.
The company’s revenue grew by 10.14 percent, from Rs. 35,027 crore to Rs. 38,582 crore in Q2 FY24-25. Meanwhile, Net profit gained from Rs 2,347.75 crores to Rs 3,170.72 crore during the same period.
Eicher Motors Ltd
Eicher Motors Ltd. is a prominent Indian manufacturer, best known for its iconic Royal Enfield motorcycles. It also has a strong foothold in the commercial vehicle segment through its subsidiary, VE Commercial Vehicles. Eicher Motors is recognized for its engineering excellence, rich legacy, and commitment to delivering high-performance vehicles, particularly in the two-wheeler and commercial vehicle markets.
The Brokerage firm has set a target of Rs. 6,600 per share for the stock, with an upside potential of 27 percent. The company’s revenue grew by 5.2 percent, from Rs. 4,388.31 crore to Rs. 4,616.85 crore in Q2 FY24-25. Meanwhile, Net profit gained from Rs 1,016.25 crores to Rs 1,100.33 crore during the same period.
TVS Motor Ltd
TVS Motor Co. is one of India’s largest two-wheeler manufacturers, offering a wide range of motorcycles, scooters, and electric vehicles. Known for its innovation, quality, and commitment to sustainability, TVS is a major player in both the domestic and global automotive markets. With a strong focus on technological advancements, the company continues to lead the way in eco-friendly and efficient mobility solutions.
The Brokerage firm has set a target of Rs. 3,050 per share for the stock, with an upside potential of 29 percent. The company’s revenue grew by 13.5 percent, from Rs. 9,983.75 crore to Rs. 11,333 crore in Q2 FY24-25. Meanwhile, Net profit gained from Rs 386.34 crores to Rs 560.49 crore during the same period.
Written by Sridhar J
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
