TVS Motor Company's reported results were in line with expectations, achieving a margin of 11.7%, slightly above the estimated 11.1%, despite facing challenges with their product mix.

The company is currently experiencing strong demand for two-wheelers in rural areas, driven by improved monsoon conditions and higher reservoir levels. This positive trend is expected to continue into FY25. However, the export market, particularly in Africa, remains challenging, leading to a cautious outlook.

Management now anticipates a 7-8% year-on-year growth in the two-wheeler industry for the third quarter of FY25, which is a revision from earlier projections. Analysts believe that the stock is already reflecting most of the positive factors, as it is trading at approximately 48x and 38x FY25E and FY26E earnings per share, respectively. Motilal Oswal maintains its earnings estimates for FY25 and FY26 and reiterates a neutral rating with a target price of INR 2,610. This target price is based on a valuation of around 32x the estimated earnings per share for September 2026, plus an additional INR 210 per share for the non-banking financial company segment.