Brokerage Views: New EV Policy Brings Auto, Component Makers In Focus

- No risks for the likes of Tata Motors and Mahindra & Mahindra, for the time being.

- New EV policy makes competitive landscape tougher for future electric cars by Tata Motors, M&M.

- Indian OEMs will need to offer an attractive value proposition to premium EV buyers.

- New EV policy is likely to result in attractive opportunities for some of the Indian auto part makers.

- Auto component makers—Sona Comstar, Motherson Sumi, etc.—stand to benefit from the entry of the likes of Tesla.

- New EV policy to support the entry of Tesla in India, some other global OEMs.

- The policy will promote investments in the EV auto components ecosystem, charging infra.

- Entry of Tesla may help to build aspirations for EVs in India.

- Sona Comstar, Sansera, Motherson Group to benefit from Tesla’s entry in India.

- Traditional players have been slow to address the opportunity.

- Challenge has been the lack of tech know-how and supply chain.

- India is price-sensitive market, over 70% of vehicles sold below $15,000.

- Demand for vehicles priced more than $30,000 is less than 3% of the market.

- Tesla's probable entry can be a negative for incumbents Maruti, Mahindra & Mahindra, Tata Motors and Hyundai.

- No immediate stock price impact because not an immediate challenge; price points high initially.

- Supply chain partners like Sona Comstar to benefit if India becomes hub for export.

- Higher subsidies boosted EV sales from 0.4% in fiscal 2021 to 5% in second half of fiscal 2023.

- Two-wheeler demand continues to shift towards EV at gradual pace.

- Share of EVs in two-wheeler sales rebound at 4-6% over 2 years.

- Electric two-wheeler prices are estimated to rise in the range of Rs 7,000-12,000.

- Maximum incentives to 3.33 lakh units; similar to registrations in November to February.

- Production-linked incentives can help cushion reduced FAME incentives.

- Policymakers prefer incentives for manufacturing/ capability over demand creation

- EVs to form 5%/7%/9%/19% over FY24/25/26/30

- The policy reasonably protects Indian OEMs largely operating below the $35,000 mark.

- Affirms view that disruption risk is abating in two-wheelers with stagnating penetration levels and consolidation.

- Passenger vehicles are entering phase of uncertainty around slowing growth.

- Emerging disruption risks with potential entry of newer players like Tesla, Vinfast, BYD, etc.

- Prefer to play the PV story through Motherson Sumi Wiring

- Citi upgraded Shree Cement from 'neutral' to 'buy', at a price target of Rs 30,000 (19.25% upside to current level).

- Rating upgrade on similar Ebitda per tonne and volume growth expectations.

- Firm expects double-digit volume growth in the current and next fiscal.

- Expects Q4 volumes to be slightly higher on sequential basis.

- Estimate FY25/26 Ebitda per tonne at Rs1,320/Rs1,350.

- Motilal Oswal retained its 'sell' rating on Indraprastha Gas, with Rs 350 target price.

- Despite end of Delhi infrastructure exclusivity in 2025, competition from new players is low.

- RoE beyond metros stand less attractive.

- APM gas allocation shortfall to continue.

- With lower spot gas prices, industrial segment prospects remain robust