At present everyone in Indian stock market is very bullish about the Electric Vehicle revolution in India. Not only retail investors or EV making companies, our govt. is also very optimistic about the future of the EV sector.
Rise of Tata Motors Stock
For all the reasons combined, share prices of every EV related stocks are rising quickly. But if any particular companies are getting the highest amount of buzz, that is tata groups. Every other tata stocks are rising very high. The stock price of tata motors rise more than 30 percent in one month. N. Chandrasekaran, the chairman of Tata groups is also very optimistic about the EV revolution in India.
Not only the tata motors, companies like Tata power and tata chemicals are already doing their part of the job. You may surprise but it is the fact that Tata power and Tata chemicals will generate more income than Tata Motors.
What happen when Tesla will enter
If Tesla and other international EV making company enter in the EV market, that may hurt the present market share of EV vehicle of the Tata Motors. But their charging system and lithium ion making companies will generate profit from every EV vehicle no matter which company made those.
First mover advantage
However we can assume that in EV vehicle sector also Tata will be an important company. Not only they started first in India but they are making and vertical integration of EV related companies which may be beneficial for the Tata Motors growth.
Growth of EV sector
If we talk about the growth of EV sector, we can find that in 5 years this industry witnessed 7X growth in last five years. In last year itself, the industry doubled. However the EV`s does not have that much market share compare to fossil fuel cars. In last year only 6000 Electric Vehicles were sold in which more than 70 percent was of Tata motors.
But there is good sign of selling this EV s in recent years. Nowadays upper class people are more aware of environmental problems due to fossil fuel cars. So they want to shift in EV consciously. At the same time the unrestrained price increase of fossil fuel is pressurizing middle class to shift in Electric Vehicles as it will be a huge cost saver for them.
The most popular brand of tata motors which is Jaguwar are recently struggling in vehicle market. So Tata Motors are also shifting their focus to Electric Vehicles more. Recently they raise 1 billion dollar from PE investors to grow their EV business.
We are seeing that Tata motors are making more effort to engulf most of the EV market vehicle with their recent activities. Various FI investors and Domestic investors are investing heavily in the tata motors along with the retail investors. Thus the price of Tata motors are increasing very fast. But as EV is an future project, there may be some downsides and more competitors in the market.
So if you are planning to invest in EV stocks you should check the market and news frequently as this type of market changes very quickly.