HSBC has issued a ‘Buy’ rating for Bajaj Auto, raising its target price from ₹11,000 to ₹14,000—an increase of approximately 27%. This optimistic outlook is driven by sustained demand for compressed natural gas (CNG) vehicles, electric two-wheelers (e2Ws), and exports to Africa, alongside the potential launch of e-rickshaws.
The brokerage believes that Bajaj Auto’s strong market position and product innovations provide a competitive edge over peers like TVS Motor Company. Despite acknowledging that current valuations are relatively high, HSBC maintains that Bajaj Auto’s earnings resilience and product triggers make it a more favorable investment.
In contrast, HSBC has rated TVS as a ‘Hold,’ with a revised target price of ₹2,800, up from ₹2,400, reflecting a 17% increase. While TVS shows promise, Bajaj’s advantages in key market segments have prompted a preference for its stock among investors.
Investors are advised to keep an eye on the evolving landscape of the auto industry, particularly with the ongoing shift towards greener technologies.
