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The Indian electric vehicle (EV) market is on an impressive growth trajectory. Expected to skyrocket from US$2 billion in 2023 to US$7.09 billion by 2025, the industry aims for 10 million annual sales by 2030. Despite EVs making up only 1.3% of car sales in 2022, the sector’s potential is vast, with over a million EVs sold in FY 2022-2023. Projections indicate a $113.99 billion market by 2029, sparking increased interest in EV stocks in India, from manufacturers like Tata Motors to battery giants like Exide Industries and infrastructure specialists like Power Grid Corporation.
Explore the best EV stocks in India based on various factors, their investments in the EV sector, key features of leading EV companies, an overview of the EV market in India, and strategies for investing in EV stocks.
Key players in India’s EV market
Hindustan Copper Ltd
Crucial for electric motors and wiring, Hindustan Copper supports the EV industry’s growth. In 2019, it formed strategic joint ventures with NALCO and MECL. In January 2024, KABIL signed an agreement with Argentina’s CAMYEN SE to develop lithium mines.
Himadri Speciality Chemical Ltd
Producing materials for lithium-ion batteries, Himadri is pivotal for EV battery efficiency. The company announced a Rs. 4,800 crore investment in December 2023 to manufacture lithium-ion battery components.
Servotech Power Systems Ltd
Specializing in solar products, Servotech is expanding into the GCC region and setting up an EV plant in Uttar Pradesh with a Rs. 3 billion investment. The company aims to produce 10,000 EV DC chargers annually and plans to establish 5,000 charging stations.
Graphite India Ltd
Providing graphite electrodes for EV batteries, Graphite India invested Rs. 50 crore in Godi India for a 31% stake. Godi India focuses on sustainable battery technology, including lithium-ion and solid-state batteries.
Exide Industries Ltd
Renowned for battery manufacturing, Exide Industries is now producing EV-specific batteries. The company is investing ₹60 billion to establish a 12 GWh Li-Ion cell plant.
JBM Auto Ltd
A leading electric bus manufacturer, JBM Auto also operates EV charging sites for cab aggregators across major Indian cities.
Tata Motors Ltd
A frontrunner in India’s EV market, Tata Motors has launched several electric models and expects sales to reach 65,000-70,000 units in 2024. The company aims to introduce EVs with a 600 km range.
Amara Raja Batteries Ltd
Expanding into the EV sector, Amara Raja focuses on lithium cells and EV chargers. The company is setting up a lithium-ion cell and battery pack plant in Telangana with a Rs. 95 billion investment.
Hero MotoCorp Ltd
Hero MotoCorp plans to launch three electric two-wheelers in FY 2025 and has partnered with Ather Energy to create India’s largest fast-charging network.
Mahindra and Mahindra Ltd
Mahindra is investing in next-generation EV technologies and aims to transition 30% of its manufacturing to EVs by 2027.
KPIT Technologies Ltd
KPIT introduced groundbreaking sodium-ion battery technology, promising cost-effective and rapid vehicle charging solutions.
Maruti Suzuki India Ltd
Set to enter the EV market with an electric hatchback by 2026-2027, Maruti Suzuki aims to make EVs more affordable and plans to reach half a million annual sales by FY 2031.
Hindalco Industries Ltd
Investing Rs. 8 billion to establish a battery aluminum foil manufacturing facility, Hindalco aims to serve the EV market with sustainable aluminum products.
Motherson Sumi Wiring India Ltd (MSUMI)
Leading the wiring harness industry, MSUMI has launched a dedicated line for high-voltage harnesses for EVs and hybrids.
Vedanta Ltd
Vedanta Aluminium contributes to the EV sector with its low carbon aluminum products, supporting the industry’s growth.
Ashok Leyland Ltd
Ashok Leyland’s electric LCVs have received significant bookings, and the company is investing in Switch Mobility to enhance its EV offerings.
Tata Chemicals Ltd
Playing a crucial role in the Tata Group’s EV ambitions, Tata Chemicals is setting up a lithium-ion cell manufacturing unit with an investment exceeding Rs. 10,000 crore.
Greaves Cotton Ltd
Greaves Electric Mobility has made significant strides in the EV industry with its “Ampere” brand and partnership with ElectricPe for EV financing solutions.
Electric vehicles growth in India
Once a distant dream, electric vehicles have become one of the fastest-growing segments in India’s automotive sector. In 2023, EV sales surged by 82%, reaching 1,39,789 units in March alone. The fiscal year 2023 saw a 157% growth in overall sales, driven predominantly by electric two-wheelers. The electric four-wheeler market is also rising, with Tata Motors leading the space. The overall EV market is expected to grow by 49% annually by 2030, with sales potentially crossing 17 million annually in the next seven years.
Advantages of investing in EV stocks
Investing in the EV sector offers numerous benefits:
- Growth potential: Significant expansion potential driven by environmental concerns, technology advancements, and supportive policies.
- Government incentives: Tax rebates, grants, and subsidies boost demand and profitability.
- Technological innovations: Leading in battery technology, autonomous driving, and connectivity.
- Environmental impact: Aligns with global sustainability goals and reduces pollution.
- Market diversification: Includes automakers, battery manufacturers, and infrastructure providers.
- Regulatory support: Benefits from stricter emission standards.
- Early-mover advantage: Higher gains by entering the market early.
- Consumer adoption rates: Growing consumer base drives sales and stock prices.
Risks associated with investing in EV stocks
While promising, investing in EV stocks carries several risks:
- Technological obsolescence: Rapid technological advancements could render existing technologies outdated.
- High competition: Intense competition can pressure profit margins and market share.
- Regulatory and policy changes: Changes in government incentives and regulations can impact profitability.
- Supply chain volatility: Fluctuations in raw material availability or price can affect production.
- Market valuation concerns: Inflated valuations can lead to volatility and price corrections.
- Infrastructure adequacy: Insufficient charging infrastructure can stifle EV adoption.
- Consumer adoption rates: Factors like cost and performance affect consumer adoption rates.
- Financial sustainability: Startups operating at a loss need strong financial health for growth.