TVS Motor Company Ltd (TVSMOTOR) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator (361 Capital Market Research): Ladies and gentlemen, good day and welcome to TVS Motor Company Limited Q2 FY '27 earnings conference call hosted by 361 Capital Market Research. As a reminder, all participants' line will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing "*" then "0" on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Annamalai Jayaraj from 361 Capital Market Research. Thank you, and over to you, sir.
Annamalai Jayaraj (361 Capital Market Research): Thank you. Welcome to TVS Motor Company 2Q FY '27 post-results conference call. From TVS Motor Management, we have with us today Mr. KN Radhakrishnan, Director and Chief Executive Officer and Mr. K. Gopala Desikan, Chief Financial Officer. We will start the proceedings with opening remarks by Mr. KN Radhakrishnan to be followed by the question and answer session. Over to you, sir.
K. N. Radhakrishnan (TVS Motor Company Ltd): Good evening. Good evening, everyone, and thanks for joining us today. First of all, festive season's greetings to all of you, all family members, and everyone present. We are delighted to share that during this quarter, we achieved highest ever sales volume, revenue and profits. The sales volume grew from 1 1.5 million units, 1.9 million units, 27% growth. Revenue grew from 11,905 crores to 17,103 crores, 44% growth. EBITDA grew from 1,507 crores to 2,219 crores, 47% growth. PBT grew from 1,224 crores to 1,865 crores, 52% growth. Profit after tax grew from 904 crores to 1,377 crores, again, 52% growth. We sincerely thank all our customers for the significant achievement and milestone. Before I get into details of second-quarter results, I would like to recollect that during the last AGM, our Chairman addressed to the shareholders, highlighting the sustained investments made by the company in building
K. N. Radhakrishnan (TVS Motor Company Ltd): nurturing consumer finance and related businesses, and that the company may, at appropriate time, guided by the long-term strategic considerations, evaluate alternatives, including a possible separation of the said business, to further strengthen and unlock shareholder value. In this regard, I'm delighted to share that the board of directors of TVS Motor today have approved a scheme of demerger of the consumer finance and the related business undertaking from TVS Motor. This will help unlock significant shareholder value through a focused platform for the group's consumer finance and related businesses. It also provides greater strategic autonomy, sharper capital allocation and enhanced flexibility to pursue sectoral opportunities. The shareholders would participate in the future growth of both mobility and financial services businesses. The demerged businesses will benefit from India's rapidly expanding financial services sector. Now, let me get into more details about the second quarter of this financial year. Q2, when we look at the two-wheeler demand, domestic ICE grew by 16% compared to last year last year, and against an industry growth of 10%. The two-wheeler international market ICE sales grew by 33% over last year as against industry growth of 27%. Total two-wheeler ICE sales grew by 20% compared to Q2 of last year. This is against an industry growth of 14%. Two-wheeler domestic EV sales grew by 129% compared to Q2 of last year and this is against the industry growth of 84%. The sales of three-wheeler grew by 47% compared to Q2 of last year and against an industry growth of 26%. So, all sectors TVS has done much better than the industry in Q2. And in terms of financial performance, during the quarter, company posted its highest EBITDA of 2,219 crores with a growth of 47% for the second quarter '26, '27 as against EBITDA of 1,507 crores in the second quarter of '25, '26. Company's EBITDA margin improved by 30 basis points. Now it's at 13% during the quarter ended September 20 '26 as against 12.7 in the quarter ended September 20 '25. Company posted highest PBT, 1,865 crores, recording a growth of 52% for the second quarter of '26, '27 as against 1,224 crores in the second quarter of '25, '26. During the current quarter, the company's profit after tax grew by 52% and it is at 1,377 crores as against 904 crores during the second quarter of last year. Now, coming to H1 financial performance, the first half of this year, the operating revenue grew by 41% and it's almost 30,999 crores as against 21,986 crores during last year first half. Profit before tax for the first half of the year grew by 52% and it is at 3,454 54 crores as against 2,274 crores during the first half of last year. Profit after tax grew by 52% and it is at 2,551 crores during the first half of the year against 1,679 crores during the first half of last year. On international business, we have recorded highest ever international business sales of 5.39 lakh units, reflecting 35% year-on-year growth. The performance was driven by sustained demand across key international markets and continued strengthening our distribution. Africa continues to be key driver supported by supported by other markets like LatAm, also Asia. So every market has done well, and we have grown ahead of the industry in every market. Three-wheeler also international market has done extremely well, and three-wheeler we are also ramping up much faster. You will see much higher growth from TVS in quarter three and quarter four. As you know, we remain focused on strengthening our international footprint through market expansion, product portfolio enhancement and deeper channel engagement while continuing to capitalize on the growth opportunities across emerging export markets. We also started EV into a
K. N. Radhakrishnan (TVS Motor Company Ltd): in the international market, and we started last year, and it is it is doing extremely well. Now, in Q2, we have done about six thou- 6,930 units, and when you compare with last year, last year of course was the beginning, we have done last year about 1,726 units. And I'm very sure, EV two-wheeler will do extremely well in the international market. We are also now commencing EV three-wheeler in the international market. Now, recently in this quarter, we have also launched TVS Orbiter and TVS NTORQ 150 in Nepal, TVS King EV MAX and TVS Orbiter in Sri Lanka. We have also brought the next generation of Apache performance to Sri Lanka, whole range of Apache series launched: RTR 160 4V, RTR 200 4V. All this are TFT versions and RTR 310 and RR 310 in Sri Lanka. Apache RR 310 and TVS iQube is launched in Kenya, and TVS Raider is launched in Egypt, and the new Callisto 110 in Jakarta. This is in Indonesia. So, quite a lot of introduction of products, new products into many of the international markets that was done in Q2, and this momentum will continue. We are expecting the two-wheeler and three-wheeler momentum will continue, and we will also do better than the industry. On commercial vehicles, the domestic three-wheeler, ICE plus EV, we grew by 65%. We have done about 26,300 units as against 16,000 units last year quarter two. Industry has grown 23%. All of us know that EV is growing much faster in the domestic markets, and we are also focusing on EV. And our EV numbers have also grown much faster than the industry. As you know, in Q2, EV penetration of three-wheelers has come to almost 44%. In fact, in the month of September is almost 48%. So, from last year, it is moving much faster. I think reflecting faster adoption, and it is moving much much faster, the industry itself is moving much faster on the EV side. Dussehra has gone well. Now, we are all waiting for Diwali season, and we have done many many variants and new ranges of products in the domestic market. TVS Jupiter dual tone Spectral range, okay, as you know, including EV, overall market share has come to almost, category share has come to almost 41% in India now. This is including EV. And actually ICE has not come down, actually the market category has grown up in in in in scooter as we have said in the past. We have also done 9 million milestone achievement of TVS Jupiter, 1 million milestone of TVS iQube during the quarter, and this is very very important in the journey. And thanks to every customer, reinforcing our focus in the suit scooter segment and especially for many of the Indian families and customers. TVS Jupiter has always been delivering more and more to our customers. Zyada Ka Fayda philosophy, which we have started as a brand essence. With that, new dual tone Spectral range, I think this is extremely accepted well in the market. For over 13 years, the brand has evolved and understood the changing needs of the Indian consumers, and it is consistently raising the benchmark through meaningful innovation. There are two new colors in this dual tone Spectral range, Spectral Blue and Spectral Copper, and it is really delighting the customers of the 110 cc scooter segment. And this is also first in the segment. And the new variant further enhances everyday comfort and convenience. It has got a premium long seat featuring an integrated back rest for the rider and the pillion, introduces the segment-first sequential turn signal lamps offering a distinctive lighting signature while enhancing visibility,
K. N. Radhakrishnan (TVS Motor Company Ltd): And this scooter, as you know, it has got the best-in-class 33 L under-seat storage and it can accommodate two helmets along with SmartXonnect and this is one of the best in the market today. Together, these enhancements reaffirm TVS Jupiter's commitment to being preferred choice of mobility for today's new-age and modern families. We are extremely happy and thankful to every customer of iQube. Okay, we have crossed that 1 million mark and there is a Celebration Edition. As you remember, the during this quarter, TVS iQube joins the legacy of its own Celebration Edition as its community reaches 1 million. It builds on the confidence of the customers, the customer milestone with an enhanced expression of India's favorite family EV, bringing together distinctive design, technology, everyday convenience. As you know, TVS iQube has been instrumental in strengthening the company's leadership in the electric two-wheeler category, and we thank each and every customer for their trust and helping us to grow this. On Norton, as you know, ManxR, Atlas is already in the process of launching in many markets in in Europe. The media and the customer feedbacks are very encouraging. Now, we are setting up very strong network in many countries in Europe. India launch is expected to be in the forthcoming months. There are many initiatives we have started in India, you will see that very shortly. There are also further new models that are getting developed. Some of them will be announced in EICMA next week. As you know, Norton has been investing on building brand, the media launches, launches in many countries in Europe and we are also setting up network and this is happening concurrently. More products, both variants of ManxR and Atlas series, along with new products are also under development. Last year, if you remember, Norton's resurgence was showcased in EICMA and making an important milestone of the brand's transformation, including all-new brand identity. At that time, four new-generation products were unveiled: ManxR, Manx, Atlas, Atlas GT. Okay, all this you will see shortly. As we as we discuss, as we progress, we have now dealers in UK, Italy, France, and you will see them in Germany, Spain, and you will see in India as well. And I'm very sure, Norton's commitment to modern, reductive design, it was very well appreciated and this approach has also been recognized through the International Design Awards with ManxR receiving accolades from IDEA and Red Dot. And preparations for launch in the new markets including US is also underway. More details I'll be able to share with you closer to the launch in these markets. On TVS Credit, TVS Credit has reported growth in disbursement, supported by sustained demand across key retail financing segments. The two-wheeler category witnessed healthy demand in semi-urban and rural markets and growing adoption of electric vehicles. The consumer durable, the three-wheeler categories witnessed strong demand supported by increased financing penetration and festive-led purchases. During this quarter, TVS Credit continued to enhance its capabilities in AI, data and analytics, and technology to drive better risk assessment, customer experience, and operational efficiency. The company further expanded its presence across semi-urban and rural India, increasing its network to over 65,000 touch points across the country. During this quarter, TVS Credit disbursed loans to over 14 lakh new customers, bringing the total customer base to almost 2.7 crores. The book size of TVS Credit grew by 22%, now is at 33,818 crores as against last year's 27,807 crores. The profit before tax for the quarter grew by 19% and it is at 330 crores as against last year's 277 crores. Now, coming to industry outlook,
K. N. Radhakrishnan (TVS Motor Company Ltd): I think industry, you know that, post GST we saw a significant growth in two-wheeler industry, we saw three-wheeler industry, we saw a good healthy growth in ICE. We also saw accelerated EV adoption. Overall the outlook is still positive, okay. There are there are some challenges because the base effect is going to play, because last year September end you saw the the GST getting corrected. But you should all remember that from October, November, the numbers have significantly the industry numbers have significantly gone up. On top of it we are expecting that there will be growth. The growth will be good single digit, okay, based on overall activities, overall GDP growth. Based on that we are expecting that you will see the ICE segment both in two-wheeler and three-wheeler to grow single digit. On the EV, EV will continue to keep up the momentum and you will see very good growth. Okay, you have seen in quarter one significant growth and momentum will continue. Then again we should remember that the base is going up even in EV. As far as TVS is concerned, we are having excellent brands and we are very confident that that is going to help us. I just want to highlight the EV penetration in two-wheelers. In September it has reached 11.6%, okay, and this is only in, if you look at total two-wheelers. If you look at only scooters, it's almost 22%. So, two-wheelers is moving very well and three-wheeler EV is also almost 47%. So, these are the two segments which are moving much faster on the EV and this momentum is likely to continue even in Q3. Now as I said, we will continue to grow much ahead of the market in domestic and the industry in international, both on two-wheeler and three-wheeler, is likely to also hold on. It will grow. And TVS, with the kind of portfolios what we have and the capacity what we're enhancing, we are very confident that we will be ahead of the industry in the forthcoming quarter and in Q4. Now before I conclude, I just wanted to once again explain the demerger in detail. The consumer finance related business undertaking of TVS Motor will be demerged into a separate holding company. The shareholders of TVS Motor will receive equal number of shares in the resulting company as in TVS Motor enabling them to participate in future growth of both the mobility business and consumer finance business. Okay? As you know, the scheme is subject to requisite statutory, regulatory, shareholder and other approvals, as applicable. Thank you, thank you once again for your for your confidence in TVS Motor. Excuse me?
Moderator (361 Capital Market Research): Yes sir, shall we begin with the question and answer session?
K. N. Radhakrishnan (TVS Motor Company Ltd): Yes, please.
Moderator (361 Capital Market Research): Okay. Thank you very much, we will now begin with the question and answer session. Anyone who wishes to ask a question may press "*" and "1" on their touchtone telephone. If you wish to remove yourself from the question queue, you may press "*" and "2". Participants are requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. The first question is from the line of Pramod Kumar from UBS Securities. Please go ahead. Mr. Kumar, you can go ahead. Since there is no response, we'll move to the next participant. The next question is from the line of Nitin from Axis Mutual Fund. Please go ahead.
Nitin (Axis Mutual Fund): Hi. Thanks for best wishes for the results. Just first on the EV side, though we've been building this conversation since many calls, and you've been very clearly telling that demand is something very robust
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