Top Electric Vehicle Companies in India: Why Should You Invest in Them?

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Top Electric Vehicle Companies in India

Top Electric Vehicle Companies in India: Overview

The electric vehicle has by now become a megatrend in the country. Every once in a while you will see an EV company making headlines in the finance industry. This indicates how the EV revolution has almost taken the nation by storm. 

In India, the footprints of the domain are all set to capture the market. With the way the hype is set up among car enthusiasts, it wouldn’t be an exaggeration to state that there might be a day when almost all the cars sold in India would be an EV. If we look at the stats,  we can see that back in 2017, when the country had initially started to explore and expand in the EV, the major companies in this space were Graphite India and HEG, while if we consider these stocks now, both have surged over 800% in a year. To understand the potential of the industry in the coming years, let us dive into its intricate details through this article:

Top Electric Vehicle Companies to Invest in India

If you are a real-time investor and are looking for a reliable sector for future investments, EV stocks are certainly your hot bait. With EV stocks booming in India, it shall help you to thrive in profits even in this falling market of 2022. 

Let us find out the top EV companies and their market potential so as to give you a brief idea of which stocks should be probable options to fit in your portfolio to give you the best returns:

Company NameLatest Share Price1 Year Share Return(%)5-Year Share Return (%)
Amara Raja BatteriesRs. 572.5-2.43%-29.7%
Ashok LeylandRs. 14113.63%4.80%
Exide IndustriesRs. 17313.17%-17.59%
Graphite IndiaRs. 300-36.46%-51.6%
High Energy BatteriesRs. 345.056.45%255%
Himadri Speciality ChemicalRs. 8555.3%-46.9%
Mahindra & Mahindra LimitedRs. 1,31855.1%83.3%
Maruti Suzuki IndiaRs. 8,7330.3%0.75%
Olectra GreentechRs. 391-42%99%
Tata Motors LimitedRs. 433.25-9.12%20.4%
Tata Power Company LimitedRs. 200.90-9.3%134%

(Data as of February 23, 2022, Source: Google Finance)

Disclaimer: The securities quoted are exemplary and not recommendatory. Past performance is not indicative of future returns

Overview of the Electric Vehicle Industry In India

In India, the recent flux of the electric vehicles industry has made the year 2022 a highlight of the field. Also, the recent union budget that has introduced a policy for the EV infrastructure and the battery industry, aims for about 100% electric mobility in the nation by the next decade. This makes the industry an attractive incentive for real-time investors.

It shall also be interesting to note that the automobile industry in India contributes about 7.5 % to its GDP and an eye-popping 49 % of manufacturing GDP. This has a significant rippling impact on the nation’s economy. This implies that in the coming years, the growth of the EV industry shall also lead to the growth of multiple auto ancillaries and the related sectors as they keep up with the trends. 

Also, India is the largest manufacturer of some vehicles such as tractors, the second-largest bus manufacturer, and accompanied the largest producer of 2W AND 3W globally. This shall lead to the vehicle penetration of 72 vehicles per 1000 people by the end of 2025 as per the market trends. India also accounts for about 40% of the total $31 bn of global engineering. Also, about 8% of the nation's R&D expenditure accounts for the automotive sector. 

However, the EVs in India as yet have only been in the variants of fossil-fuel driven 2 and 4-wheelers. India is yet to experience high-performing luxury variants or even supercars like that Teslas in the automobile market.

Nevertheless, it cannot be denied the market potential is huge and yet to be explored. At the same time, the automotive segment is likely to witness a splurging growth in the Indian market with the introduction of EVs. 

Top Electric Vehicle Companies in India: Why Invest in Them?

It can be pictured that the automobile market in India must be on a watchlist for exploration by a long-term investor. Let us consider some of the following rationales for investing in EV stocks in India in 2022

  • The Automotive Mission Plan (AMP) of 2016–26 has captured the collective ambition of the government of India as well as the automotive industry. The industry seeks to contemplate its size and its contribution to the country’s development along with its footprint and competition across the globe.
  • About 65 million direct and indirect jobs are expected to be created in the automobile sector in the coming decade. This suggests a lucrative motive for investors to consider investing in the automobile industry.
  • The AMP 2016-26 envisages that the sector is likely to contribute more than 12 % to the country’s GDP and shall constitute a minimum of 40% of the manufacturing sector by the end of 2026. This figure is set in order shall change the automobile scenario and India.
  • One interesting thing to note is that the plans for in-house manufacturing of lithium-ion batteries in the country might bring down the EV cost in due time and this shall reduce the dependency as well as the troubling import duties. Thus creating an opportunity for a huge market in India soon.
  • The future of automobile manufacturing is said to be lying in the hands of EVs in India. With the current climatic conditions and concerns over it, EVs are likely to become the mainstay of the industry in the coming years. This must therefore be a target for a smart investor as the future of the EV market looks quite promising in India. 

Suggestions for Investors Investing in EV Stocks:

  • Research: It is suggested to do extensive research before investing in an automobile company in India. It is vital to understand the financial growth potential of the companies instead of backing your investment on historic data in the case of EV stocks
  • Look out for market leaders: India has seen substantial growth in the field of the auto–sector and is likely to further see exponential growth in the sector. Therefore it is important for an investor to check out the market competition and the trending companies of the industry which shall account for providing high future returns. 
  • Check on government investments: These stocks are likely to drive the demand-supply of the market in India. EV drives have been receiving huge support from the government of the nation, specifically for in-house manufacturing. The electric vehicle industry has geared up massively in India. Also, with the collaboration of the government of India and automobile manufacturers, the industry is set to see the light of development.
  • Mergers and acquisitions: Another factor that acts as a driving force for the investment industry, is mergers and investment plans that have been lined up currently with the home companies. These are extensive fundamentals that an investor must consider to gather an in-depth analysis of where to park their investments in the market.

The need for electric mobility and green energy has skyrocketed the electric vehicle stocks in the country and among automobile manufacturers. These industries are in line to benefit from the set motive however it shall be a difficult road to step in as for standard The EV giant Tesla has marked this new era of the EV industry in the world.

As far as the market flourish is concerned, the pandemic has created a demand for products that helps to curb the alarming pollution level, and electric vehicles are a remarkable way to significantly reduce the emissions in the environment and a step towards sustainable growth. 

 However, from an investment point of view, following the recession pattern in the country, it shall not be advisable to put everything at stake rather analyze the positives and negatives and if the country has the potential to reach the said benchmark otherwise these numbers shall only be good to be true in pen and paper. Therefore it is advised to invest with caution and apply sincere due diligence before making a viable investment decision.

Important things to remember:

1. Do Not Blindly Follow Hot Tips

No matter how credible the source is, never follow a stock marketing tip blindly without conducting thorough research personally. Always select the stocks after doing proper research and analysis on the performance as well as the companies. While some tips can work out to give you huge benefits, the wrong ones can push you down under the risk pretty quickly. 

2. Eliminate Loser Stocks from Portfolio 

There is absolutely no guarantee that a stock will rise after a great fall. Know that it is extremely important to be practical about what is possible and what's impossible in the stock market. So, upon realizing that a stock is performing poorly in your portfolio, accept your mistake and sell it immediately to prevent further losses. 

3. Don't Exceed Your Investment Budget Abruptly 

While it's true that long-term investments are way better than other forms of investment, you shouldn't exceed your investment budget in a haste. Instead, decide on a fixed amount and invest it across various good stocks. Rather than investing in only one stock, divide your budget evenly across multiple good-performing stocks and shares. 

Disclaimer: The securities quoted are exemplary and not recommendatory. Past performance is not indicative of future returns

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