Chennai-based TVS Motor Company, a prominent manufacturer of two and three-wheelers, has announced a significant improvement in the availability of magnets, which are crucial components for electric vehicle (EV) production. The company anticipates a resurgence in battery-powered two-wheeler adoption in the upcoming quarters, despite current EV market penetration being somewhat subdued.
Recovering Magnet Supply to Boost EV Output
During the company's Q3FY26 earnings call, K N Radhakrishnan, Director and CEO, addressed previous setbacks in EV production due to magnet shortages. "On the EV side, we had a setback because of magnet availability. We tried our level best, and now it is recovering, and hopefully, in another month, you will see full EV supplies in the market as well," he stated. Radhakrishnan further emphasized that the temporarily reduced EV penetration is projected to enhance moving forward.
Record Electric Scooter Sales Amid Challenges
Despite the magnet supply issues, TVS Motor achieved a milestone with its electric scooter volumes surpassing one lakh units for the first time in a quarter. In the December 2025 quarter, the company sold 1.06 lakh units, marking a substantial 40% year-on-year increase. This performance notably exceeded the overall industry growth, as VAHAN data indicated the EV industry expanded by 14% in the first nine months of the fiscal year and 7.5% year-on-year in the December quarter.
Two-Wheeler Industry Recovery and Outlook
Radhakrishnan highlighted a sharp recovery in the two-wheeler industry during Q3, largely driven by a GST rate reduction that stimulated consumption across various segments. The industry grew nearly 20% during the quarter, with urban markets expanding by approximately 21% and rural markets by close to 19%. The company expects this positive momentum to continue into the March quarter, supported by several factors:
- Healthy GDP growth of around 7%
- Favorable monsoon conditions
- Higher reservoir levels aiding rabi sowing
- A repo rate cut by the Reserve Bank of India (RBI)
Strong International Performance
On the international front, TVS Motor reported robust export performance, with shipments from India rising 23% in Q3. Demand in Africa showed sequential improvement, while Latin America recorded year-on-year growth. South Asia demonstrated resilience, led by a strong recovery in Sri Lanka and steady demand in Nepal. However, the European market remained challenging, with growth expected to take several more quarters to recover.
Financial Highlights for Q3FY26
TVS Motor posted a strong third-quarter financial performance, benefiting from higher volumes and operating leverage. Key financial metrics include:
- Operating revenue increased 37% year-on-year to Rs 12,476 crore
- Operating EBITDA rose 51% to Rs 1,634 crore
- EBITDA margin expanded to a record 13.1%
- Profit after tax jumped 52% to Rs 940 crore
This comprehensive performance underscores TVS Motor's resilience and strategic positioning in the evolving automotive landscape, particularly in the electric vehicle segment.
