# 1. Financial Performance ## A. Key Figures * **Operating Revenue:** **₹12,476 Cr** Q3 FY'26 (+27%) · **₹34,463 Cr** 9M FY'26 (+29%) * **Operating EBITDA:** **₹1,634 Cr** Q3 FY'26 (+51%) · Margin: **13.1%** (+120 bps) * **PBT (ex-exceptional):** **₹1,315 Cr** Q3 FY'26 (+57%) · **₹3,594 Cr** 9M FY'26 (+43%) * **PAT:** **₹940 Cr** Q3 FY'26 · **₹2,625 Cr** 9M FY'26 * **TVS Credit PBT:** **₹390 Cr** Q3 FY'26 (+21%) · Book size: **₹29,678 Cr** (+9%) ## B. Revenue Growth * **Record Top-Line Momentum:** Strong double-digit revenue and volume growth driven by robust demand, international expansion, and **spare parts revenue of ₹1,183 Cr**. * **Growth Levers:** Premiumization, product mix optimization, and **3% price increase** implemented to offset cost pressures while maintaining competitiveness. * **International Business Resilience:** IB revenue reached **₹2,909 Cr**, reflecting sustained global footprint and execution capability. ## C. EBITDA & Margins * **Margin Expansion Accelerates:** EBITDA margin improved 120 bps to a record high, with **70 bps expansion on a normalized basis excluding PLI**, underscoring operational efficiency. * **Profitability Drivers:** Scale benefits, favorable product mix, cost reduction, and **₹60 Cr incremental marketing spend** on new launches supported margin resilience. * **Sustainable Cost Management:** Focus on balancing input cost headwinds via volume growth and operational leverage rather than aggressive pricing. ## D. Profit After Tax * **Strong Bottom-Line Growth:** PAT surged year-on-year despite **₹41 Cr exceptional item** related to past service costs under new labor codes. * **TVS Credit as Growth Engine:** Disbursements added **over 41 lakh new customers** in 9M, scaling total base to **nearly 3 crore**, with rising profitability. --- # 2. Volume & Market Share ## A. Key Figures * **Domestic ICE Sales Growth:** **21%** YoY (vs. industry **16%**) · **International Sales Growth:** **35%** YoY (vs. industry **23%**) * **Two-Wheeler ICE Sales:** **25%** YoY (vs. industry **17%**) * **EV Two-Wheeler Sales:** **106,000 units** (Q3 FY'26) (+40% YoY) * **Three-Wheeler Sales:** **60,000 units** (Q3 FY'26) (>2x YoY) * **EV 3-Wheeler Volumes:** **8,500–9,000 units** (quarterly) ## B. Domestic Sales * **Outperformance Across Segments:** Domestic two-wheeler ICE and EV sales both grew at strong double-digit rates, significantly outpacing industry averages. * **Urban-Rural Parity:** Urban markets showed marginally stronger growth than rural, though rural demand remains robust, supported by **favorable monsoon conditions** and improving **scooter penetration**. * **Rural Premiumization:** Rising adoption of **premium and super-premium scooters** in rural areas reflects improved infrastructure and access to retail financing. * **Strategic Focus:** Company prioritizes **market share gains in premium and scooter segments** over segment-level margin optimization, targeting sustained top-line outperformance. ## C. International Sales * **Strong Momentum:** International sales surged on the back of **GST 0 implementation**, positive macro conditions, and festive demand, driving deeper penetration and share gains. * **Growth Strategy:** Aims to maintain above-industry growth via **premiumization**, **scale economies**, and **cost discipline** to boost EBITDA. ## D. EV Unit Growth * **EV 3-Wheeler Traction:** Quarterly volumes in the **8,500–9,000 unit range** indicate steady scaling in the EV three-wheeler segment. ## E. Three-Wheeler Performance * **Explosive Growth:** Three-wheeler sales more than doubled year-on-year, reflecting strong product-market fit and execution capability. --- # 3. Product & Segment Mix ## A. Key Figures * **Scooter Segment Share:** **~40%** of 2-wheeler industry * **EV Penetration (3-Wheelers):** **32%** in Q3 * **Norton Investments:** **₹240 Cr** prior quarter · **₹290 Cr** current quarter ## B. Scooter Segment * **Dominant Position:** Scooters now represent a near-majority share of the 2-wheeler market, underpinned by strong performance across both ICE and EV platforms. * **Growth Drivers:** Premiumization and targeted product interventions are fueling outperformance versus the broader market. * **Brand & Innovation Strength:** Diverse portfolio spanning Apache, iQube, NTORQ, and others, supported by robust R&D, enables customer-centric differentiation and sustained demand. ## C. EV Portfolio * **Market Leadership in EVs:** Strong Q3 performance with iQube, Orbiter, and King EVs driving VAHAN market share gains in the L5 category. * **Outpacing Industry Growth:** EV sales are expanding at a faster rate than the overall market, with both iQube and Orbiter contributing to robust momentum. * **Path to Profitability:** EV business is already contribution positive, with management confident of reaching EBITDA breakeven as scale improves. * **Production Ramp-Up:** Orbiter demand exceeds initial supply, with output scaling toward **10,000 units/month** to meet regional demand. * **PLI Benefits Broadly Availed:** Most EV models qualify for PLI incentives, though high-priced, low-volume variants remain excluded. ## D. Premium & ICE Models * **Premium Segment Outperformance:** Super-premium and premium categories are growing faster than average, while entry-level demand remains subdued. ## E. Norton Lineup * **Global Super-Premium Push:** Norton’s new Manx and Atlas families, launched at EICMA 2025, target affluent global customers with high-emotion design. * **India Market Strategy Differentiated:** Local launches planned with tailored approach; global rollout set for 2026. * **Product Pipeline Expansion:** Potential 2026 launches include M1-S electric Maxi scooter and ESX electric motorcycle. * **Investment Ramping:** Norton-related spending increased sequentially, reflecting intensified development and launch preparations. * **Losses Expected to Narrow:** Subsidiary losses, including Norton, are projected to decline over time despite no defined breakeven horizon. --- # 4. Capacity & Supply Chain ## A. Key Figures * **EV Production:** **30,000–32,000 units/month** iQube · **~10,000 units/month** Orbiter * **Dealer Inventory:** Maintained at **21–30 days** of supply * **Capacity Lead Time:** **2–3 months** to scale up production ## B. Production Levels * **Robust Monthly Output:** iQube remains the volume driver with near-term scale, while Orbiter production reaches meaningful levels, reflecting strong model-level traction. ## C. Capacity Expansion * **Proactive Scaling:** Capacity expansion is underway with short lead times, underscoring agile manufacturing response to sustained demand. * **Forward-Looking Planning:** Next-year capacity roadmap under active review, with formal updates expected at the next earnings call. ## D. Supply Constraints * **Demand-Driven Tightness:** Temporary supply gaps in EVs and new launches were exacerbated by festive demand and seasonal shutdowns, now resolving. * **Component Bottleneck Easing:** Magnet supply disruption that impacted iQube and Orbiter is **normalizing**, with full recovery expected imminently. ## E. Localization Efforts * **Tariff Mitigation in Mexico:** Increased local content rollout underway, with adjustments taking **approximately two months**, limiting exposure to import duties. --- # 5. International & Export Trends ## A. Key Figures * EV Industry Growth: 14% YoY (9M) · 7.5% YoY (Q3) * **India’s Export Growth:** 23% QoQ (Q3) * **Export Volume Growth:** >35% YoY (YTD) ## B. Africa & LatAm Growth * **Outperformance in Key Regions:** Exports gaining strong momentum in Africa and LatAm, with Q4 expected to deliver robust performance amid market recovery and industry-leading growth. * **Demand Drivers:** Strong regional demand supported by improved supply chain conditions, including resolution of prior magnet shortages. ## C. Asia Market Recovery * **Sri Lanka-Led Rebound:** Asian markets recovering strongly, anchored by Sri Lanka—where Jupiter holds a leading position—and sustained demand in Nepal. * **Global Scalability:** Company affirms it has both the product portfolio and production capacity to meet rising overseas scooter demand across Asia, Middle East, Turkey, ASEAN, and emerging LatAm markets. ## D. Export Volume Trends * **Broad-Based International Expansion:** Export growth significantly outpacing domestic EV industry trends, with Jupiter emerging as a key growth engine across multiple geographies. * **Europe Lags, But Recovery Expected:** European markets remain stagnant but outlook calls for gradual improvement over the next few quarters. --- # 6. Risks & Commodity Exposure ## A. Key Figures * **Commodity Cost Impact:** **0.2%–0.3% of sales** (precious metals) · **0.4% overall** (total commodity basket) * **Hedging Realization Rate:** **INR 88** (current quarter) * **Hedging Horizon:** **12 weeks** coverage for net currency exposure ## B. Material Cost Inflation * **Broad Commodity Pressure:** Inflation in **aluminum, copper, zinc, and precious metals** (platinum, palladium, rhodium) is impacting input costs, exacerbated by **BS-VI emission norms** increasing precious metal content. * **Mitigation Framework:** Cost absorption supported by **scale benefits, product diversification, and operational efficiency**, with selective price adjustments balanced against customer value delivery. * **No Active Hedging:** TVS Motor is **not currently hedging commodity exposures** but remains engaged with agencies to assess options amid volatile input markets. * **Phased Cost Flow-Through:** Commodity cost impacts are **partially realized**, with effects **spread across Q3 and Q4** due to production-wholesale timing lags. ## C. Currency & Duty Risks * **Mexico Exposure Limited:** New duties pose **minimal risk** due to **low export volumes** and active **localization strategy** in the Mexican market. * **Disciplined FX Management:** Robust **12-week currency hedging policy** in place; current realization at INR 88 supports predictability in foreign income. --- # 7. Guidance & Outlook ## A. Key Figures * **Q4 Industry Growth:** **~20%** (Dec quarter) · **mid-to-high teens** (Jan retail) * **TVS Q4 Growth Forecast:** **>15%** * **Capex Guidance:** **₹1,700 Cr** (up from ₹1,600 Cr) * **Total Investment Guidance:** **₹2,900 Cr** (up from ₹2,000 Cr) * **Long-Term Industry CAGR:** **8%–9%** ## B. Q4 Growth Forecast * **Outperformance Confirmed:** TVS expects one of the strongest Q4 growth performances in the sector, significantly outpacing its own medium-term industry growth assumptions. * **Growth Drivers:** Strong momentum underpinned by **positive GST impacts**, robust domestic demand, and competitive advantages in product portfolio, technology, and consumer focus. * **No Margin Guidance:** Company refrained from providing Q4 gross margin outlook but remains confident in sustaining industry-leading growth trajectory. ## C. Industry Momentum * **Macroeconomic Tailwinds:** India’s **7% GDP growth** and **125 bps repo rate cut** are enhancing liquidity and credit availability, supporting durable consumer demand. * **GST-Driven Upside:** GST benefits across consumer goods are amplifying demand spillover into 2-wheelers, with positive effects expected through H1 of next fiscal. * **Cautious Optimism Beyond FY27:** While near-term momentum is strong due to **market shortages and pent-up demand**, sustainability hinges on whether current trends reflect structural recovery or temporary demand pull-forward. ## D. Capex & Investment Plan * **Strategic Expansion Accelerated:** Capex and total investment guidance meaningfully raised to **₹1,700 Cr** and **₹2,900 Cr**, respectively, reflecting confidence in growth and capacity needs. * **Premium & Innovation Focus:** Major allocations directed toward **Norton’s market entry**, **ION electric platform**, **e-bikes**, and **Dubai expansion**, underscoring strategic bets on premiumization and global reach. * **Subsidiary Buildout:** Significant capital deployed in TVS Credit Services and PT TVS, signaling integrated ecosystem development across financing and new mobility. ## E. Long-Term Volume Targets * **Structural Growth Case:** Management maintains long-term view of **8%–9% CAGR** for Indian 2-wheeler market, supported by deepening mobility penetration and self-employment trends.