Recently Tata Motors has given some announcements and projections for the Electric Vehicle (EV) business. So, let’s discuss the same in this article as we move ahead.
Tata Motors EV Business- Current Status and Future Projections:
- Currently, the EV Business of Tata Motors is not so high and it’s less than 10,000 units annually.
- But the company has given the target of producing at least 50,000 electric vehicles by FY23. The company is quite confident about achieving this target.
- Further, in the coming 2-3 years, the company wants to increase this EV production from 1.25 lakhs to 1.5 lakhs per annum.
- Moreover, if the company can produce and can sell these target figures, then the EV business alone can generate revenue of around Rs. 5,000 Cr. for the company in India.
- The investments received from TPG Rise worth Rs. 7,500 Cr. or $1 Billion specifically in Passenger Vehicles (PVs) segment at the valuation of around $9.1 billion will also be justified if the company can do the business of targeted amount in FY23.
- The share of units sold of Electric vehicles to the total sold units of the company was just 0.2% in FY20. But the same has increased remarkably and has touched the mark of 5.6% to the total sales share of the company in Q3FY22.
- Over the long term to be specific in the coming 3-5 years, the company has set a target of taking a share of EV business to 20% of the total sales mix of the company globally.
- Specifically in India geography, the peers like Hyundai, etc. do not look to be aggressive on launching EVs till FY24.
- Currently, Tata Motors are having 2 variants of EV, but the company is going to launch 3 more variants in the coming period that too in the affordable range of below 10 lakhs. The models which are expected to launch are All New Tiago EV, Punch EV, and Altroz EV.
- The travel range of these models could be up to 200 Km per charge.
- In the September-December 2021 quarter, Tata Motors has replaced Hyundai in terms of market share and has gained the second position.
What Should Shareholders Do?
With all such updates and developments across the EV segment, it looks like Tata Motors is quite aggressive in taking early mover advantage in the EV space in the country. Looking at the strong focus towards EV, the company can also strengthen its second position in terms of market share. Hence, Tata Motors is one such stock on EV space that is playing strongly and hence one should keep this stock on the radar.