TVS Overtakes Yamaha in Market Capitalization, Becoming the Third-Largest Global Two-Wheeler Manufacturer

In a remarkable turnaround, TVS Motor Company, a homegrown motorcycle manufacturer, has outpaced the Japanese giant Yamaha Motor Co., becoming the world's third-largest two-wheeler maker. This significant shift in the market's landscape is a testament to TVS's resurgence, reflecting the growing optimism among investors in both domestic and international markets.

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In a remarkable turnaround, TVS Motor Company, a homegrown motorcycle manufacturer, has outpaced the Japanese giant Yamaha Motor Co., becoming the world's third-largest two-wheeler maker. This significant shift in the market's landscape is a testament to TVS's resurgence, reflecting the growing optimism among investors in both domestic and international markets.

TVS Motor's market capitalization (Mcap), based in Chennai, has skyrocketed by an impressive 37% in the last six months, reaching a substantial $9.2 billion. In stark contrast, Yamaha Motor has witnessed a decline in Mcap, shedding $1.6 billion from its peak in August. As of the latest data from Bloomberg, Yamaha Motor's Mcap stands at $8.8 billion, trailing TVS Motor by $348 million.

It's worth noting that Indian two-wheeler manufacturers occupy four of the top five spots on the global stage. Leading the pack is Bajaj Auto, boasting an impressive MCAP of $19 billion, followed closely by Eicher Motors with an MCAP of $11.5 billion. Hero MotoCorp clinches the fifth position with a market valuation nearing $8 billion.

TVS Motor's remarkable ascent can be attributed to its dominance in the electric scooter segment, along with a consistent increase in market share across all categories over the past few years. The scooter segment has witnessed substantial growth in market share, surging from 16% to an impressive 23% between FY18 and Q1FY24. Similarly, the 125cc+ bikes segment saw an upswing, rising from 13% to 17% during the same period.

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Analysts from Jefferies expressed their optimism for the Indian two-wheeler industry, foreseeing a robust recovery from a cyclical downturn. They anticipate a 15% volume compound annual growth rate (CAGR) between FY23 and FY26. Furthermore, they believe that TVS is well-positioned to capitalize on the resurgence in domestic and international markets, with the potential for further margin expansion due to its strengthening franchise.

While Harley-Davidson, the US-based giant, secured the seventh spot with a Mcap of $4.3 billion, the top ten two-wheeler makers globally feature three prominent Chinese manufacturers. The shift in rankings underscores the evolving dynamics within the two-wheeler industry on a global scale.