Lets examine top down where will check out scope in 2,3,4 wheeler vehicle stocks, then move to charging stations, Lithium battery & then to all other ancillary & tertiary listed business.
In 4 wheeler, we need to understand that electric vehicle will not change the picture on the street too soon. Reason being that economic benefit is still low in electric vehicle & Indian middle class need to find economic advantage to move to electric car.
Invest in Electric Vehicle Stocks
On top of this, we need to understand that anyone who will own a car would not risk considering there are limited charging stations in the cities & almost zero charging stations outside city. Cars are meant to be driven outside city for weekend trips & stuff.
Will things remain so? No, definitely not. As technology improves, EV cost will decrease. In parallel, Petrol, diesel cost is going to rise. This means there will be a smooth transition over a period of 15 yrs from Fuel Car to Electric vehicle.
Coming to 2 wheeler, Change will be through 2 wheelers very fast. Reason being cost of 2 wheeler is not too high. & 2 wheeler are mostly driven within city.
But lot of start ups are in 2 wheeler & hence, you may expect Auto companies to not make too much profit of this EV ride but see a transition. Hence, its better to put bet on ancillary business which will benefit the most.
2 Wheeler startups to Invest in Electric Vehicle Stocks:
Govt’s electric vehicle push: Watch out for these 3 stocks
The company has a wide reach in Indian markets and is one the most trusted by Indian car owners.
The company is going to launch its electric vehicle Maruti Suzuki Wagon R electric vehicle in the second half of 2021. Provided the infrastructure developments also go hand in hand with the launch of electric vehicle, the car will see a good sale in future.
2. Amar Raja Batteries
As the main component of the electric vehicles is battery, India's second-biggest traditional battery maker Amara Raja is looking to build a Lithium-ion assembly plant soon. The firm is already working in collaboration with different state governments to promote the use of electric vehicles. They have collaborated with Delhi government to set up charging station.
Amara Raja launched EV charging stations and battery swapping stations in collaboration with Tirupati Municipal Corporation along with a fleet of electric auto-rickshaws as part of the central government’s Smart Cities program.
3. Minda Industries
World’s best performing Indian auto parts maker Minda Industries will get a boost from the electric vehicle market. The company is in touch with original equipment manufacturers for possible EV-compatible systems and is evaluating existing products to see how they will fit into the market. The company has already increased the R&D costs to enter the electric vehicle segment to capitalize on the opportunity.
Battery stocks Invest in Electric Vehicle Stocks:
Coming to Lithium battery which contributes 40% of electric vehicle cost, there is huge potential in terms of revenue.
What this means is listed Battery business will do well irrespective of startup/established vehicle manufacturing company. Additionally, Lithium battery is new segment being created. This means that companies will start with low base & scope of growth will be 30–50% CAGR.
Stocks to focus on in battery segment: Tata Chemical, Exide, Amaraja Battery
Charging Infrastructure: TATA POWER
This will play an important role where even common people will be able to make money by setting up charging stations in future. For listed space, TATA Power is the right business to bet as they are the most aggressive player in charging stations. Also, TATA Motors+ TATA Chemical+ TATA Power Jugalbandi can be very beneficial for each of them to grow.
Battery Component materials: Graphite India, HEG, HSC
When to comes to Minerals: GMDC, MOIL should be considered.
In this article, we discussed the list of the top EV stocks in India along with leading Electric Vehicle Manufacturers, their current work in EV segment, and future prospects. The Indian government had set up the aim of replacing all internal combustion engines with EV’s by 2030.
A report from Mckinsey and Company from 2017 indicated that 40% of electrification was a more realistic picture of mobility in 2030. This report, however, was prior to the Pandemic ( Electric Vehicle Stocks ). This, in turn, will further set back electrification in the industry for years to come.