5 Best Ev stocks to buy in india 2022

5 Best Ev stocks to buy in india 2022

Introduction

5 Best Ev stocks to buy in India 2022. Hello, did you think a few years ago that such four-wheelers or two-wheelers will come which will not require petrol or fuel? If we see today, everyone is talking that Electric Vehicles (EV) will transform the entire automobile industry. Did you know when was the first electricVehicles come? The first electric vehicle was demonstrated at an industry convention in 1835 by a British inventor.

If we talk about India, then the name of the first electric vehicle was ‘Lovebird’ which was made by Eddy Current Controls Company. After that, India’s first electric three-wheeler was launched in 1996, which was manufactured by Scooters India Pvt Ltd. Then in 2000, the first electric bus was developed by Bharat Heavy Electricals Limited (BHEL). Then in 2001, Reva Electric Car Company (RECC) launched India’s first successful electric car which was known as Reva.This company was later acquired by Mahindra & Mahindra.

So, in today’s Blog, we will tell you about 5 best EV stock to buy in india 2022 companies whose price is less than ₹ 500. In this Blog , we will understand the EV industry, challenges, and business of these stocks and key strengths and risks or weaknesses. In addition, in the end, we will look at some key financial and technical metrics for all companies in one table. While selecting the stocks, it has been taken care that these companies are not fundamentally weak.So in this list, we will tell you about the stocks whose: Market cap is more than ₹5000 crores, Return on Equity (ROE) is greater than 8%, Debt to equity is less than 2 .

So let’s start with the analysis of the industry.  The electric vehicle industry is now in the starting phase in India, but the government is taking many steps to promote it.  But why the need for an electric vehicle?  Electric vehicles cost a lot of work to operate, they do not require much maintenance.  And most importantly they are good for the environment because they run without fuel.

 India launched the National Electric Mobility Mission Plan (NEMMP) 2020 in 2013  Its main objective of developing national energy security, vehicle pollution, and domestic manufacturing capabilities. The Indian government is also planning that by 2030, they will shift to electric vehicles.  The market value of Indian Electric Vehicles is expected to reach USD 1,434.04 billion or USD 15,397.19 billion, by 2027 at a CAGR of 47.09%.  As of now, EV sales make up 1.3% of total vehicle sales, but you could expect the landscape to change rapidly. India’s automotive industry is currently the fifth largest in the world and will probably be the third-largest by 2030. Now let’s see some challenges in the industry.

The biggest challenge is charging facilities.Currently India has very few Charging Stations.India probably needs 400,000 charging stations by 2026.  The second big challenge is cost.  The initial investment cost of EVs is very high and the cost of batteries is also very high.  In addition, because a lot of raw materials are imported, the import cost is also very high.  The third big challenge is that the electric vehicle is more expensive than a normal vehicle, so the general public may not buy it. Now let’s move to our 5 EV stocks today that are trading below ₹500.

Best Ev stock to buy in india 2022

1. Indian oil Corporation Limited ( IOCL)

In this list, the first stock is Indian Oil Corporation Limited. IOCL is in refining, pipeline transportation, marketing of petroleum products, R&D, exploration, production, marketing of natural gas & petrochemicals. It is a government-controlled company. The market price of the company as of 18 july 2022 was ₹71.2. It has installed 1,000 electric vehicle charging stations and intends to set up 10,000 fuel stations in the next three saloons.  It has tie-ups with Tata Power, REIL, PGCIL, NTPC, Fortum, Hyundai, Tech Mahindra, BHEL, and Ola for installing EV chargers.  Not only this, the company has collaborated with Sun Mobility for green energy and battery swapping stations. The company has entered into a joint venture with an Israeli company for a battery manufacturing plant, and the same has been set up. Competition is the biggest face for many companies .  Many oil companies have entered this industry and because of this, they lose their market share.  Not only this, but since EVs involve a lot of money, the company will have to make a lot of investments for expansion.

2. Power Grid Corporation

Now let’s talk about the second stock which is Power Grid Corporation of India Limited.  It is a government company that is the largest electric power transmission company in India. The market price of the company as of 18 july 2022 was ₹210.45.  The charging infrastructure for the company’s EVs is well established across the country.  The company offers its charging solutions Electric 2-Wheelers, E-Rickshaws/Autos, E-Cars, and Buses.  More recently, the company has talked about building 11 Electric Vehicle Charging Stations (EVCS) in Shillong.  The biggest strength is its high operational efficiency This resulted in consistent performance, with increased earnings, strong project execution skills, sound financials, and strong liquidity position. In addition, the company has secured 21 transmission projects through Tariff-Based Competitive Bidding (TBCB) Out of which 9 projects have become operational and the rest will be completed by September 2022.  The company’s biggest weakness is that much of its wire revenue comes from state power utilities They either end up delaying payments or defaulting on payments.  Other than that, as it is a government-controlled company, decision-making can be slow.

3. National Thermal Power Corporation ( NTPC)

The third company is NTPC Limited.  The main function of the National Thermal Power Corporation (NTPC) is power generation and providing bulk power to State Power Utilities.  It also does consultancy, project management, supervision, energy trading, oil and gas exploration, and coal mining.  The market price of the company as of 18 july 2022 was ₹149.85.  NTPC has so far installed 142 EV charging stations Their subsidiary NTPC Vidyut Vyapar Nigam (NVVN) has orders for 204 EV charging stations, spread across 8 cities. Not only this, NTPC has a prominent position in the power generation sector of India. Of the total installed capacity in India, the company accounts for about 17% and electricity generation ka 20%.  Apart from that, the company has tied up with Indian Oil Corporation to install EV chargers.  It has the same weakness as Power Grid Corporation of India Ltd.  It is controlled by the government and there is a risk of payment coming late in full payment from the State Power Utilities.NTPC may face challenges in maintaining its cost competitiveness  due to a lack of coal availability and uncertainty in terms of the contract with the company’s main supplier, CIL (Coal India Limited).

4. Exide Industries Limited

The fourth company on our list is Exide Industries Limited.  Exide Industries Limited is in the business of storage batteries.  The company designs different types of acid storage batteries and manufactures and sells them. The company was earlier also in the life insurance business but was acquired by HDFC Life sometime back. The market price of the company as of 18 july 2022 was ₹149.50. The company makes lithium-ion batteries for EVs.  It has entered into a joint venture with Switzerland-based company LeClanche  to manufacture lithium-ion batteries and provide energy storage systems.  It has adopted new technologies and transformed its manufacturing process to provide the latest products and solutions to its customers. Competition is the biggest challenge for the company. Amara Raja Batteries and Exide Industries are organized players in the industry But Amara Raja Batteries has already partnered with a foreign partner (Johnson Controls) giving them much support from the company.

5. Mothersons Sumi Systems Ltd.

Our last company on the list is Motherson Sumi Systems Ltd. Motherson Sumi Systems Limited’s core business is the manufacture and supply of Automotive Components.  The company is India’s largest automotive wiring harness company and also one of the largest auto subsidiaries.  The market price of the company as of 18 july 2022 was ₹126.70.  A major segment for the company is Automotive Wiring Harness.  A wiring or cable harness is a group of wires or cables used to transmit signals and electrical power.  There is a wide need for a wide range of wiring components for EVs  Motherson Sumi Systems is currently the largest company in the world by offering wiring harnesses in India.  Hence, going forward, this segment is playing an important role in increasing its revenue and profits.  One potential risk the company faces is that it is exposed to the cyclicality of demand from the global automobile industry.  Another risk for the company is that it has been making very aggressive acquisitions.  It has a track record of being achieved by troubled companies.  If any of these companies do not perform, then the company may suffer a lot.  Let’s take a look at the key financial and technical ratios now,we have shown some key financial and technical ratios of all companies. Where have included some valuation ratio in the form of price-to-earnings ie P/E ratio.  We have included the solvency ratio in the form of the debt to equity ratio and also include a profitability ratio in the form of return on equity.  We have also included 5 year-sales growth so that you get the idea, of how fast the business of these companies is happening.  We were also able to see the recent stock performance of the companies showing even 1-year return.  And finally, we have also included the prices of 2 technical indicators to show the stocks from a technical perspective as well.  We have used 2 technical indicators – 200 DMA (Day Moving Average) i.e. 200 Day Moving Average and RSI (14).  If a companies stockmarket price is trading above the 200 Day Moving Average, the stock can be considered bullish. And if the price is trading like a niche as compared to the 200 Day Moving Average then the stock can be said to be bearish. In terms of RSI, RSI values ​​above 30 are generally considered oversold, and thus a trend reversal from downtrend to an uptrend. Similarly, an RSI value above is 70 is considered a buy signal, and a trend reversal is likely.

So these were the 5 EV companies whose price is less than 500. We remind you that these blogs are for educational purposes only, and do not recommend any kind of buy/sell. IN our blog you can know about the latest market updates, interesting blogs, and news.

Also , Read- Top 10 Multibagger Stocks for 2022 India

Bonus Tips

ITC is hitting an all-time high, do u know why? ITC has recently hit an all-time high and has constantly been growing well but how can a few months push a blue chip stock high? Here are some answers, ITC is the current CG industry leader with a market share of over 75% also ITC is the second largest FMCG company with a high variety of snacks, frozen food, beverages, etc. since 2019 the Cg and FMCG company has been trading at high levels and has also out performed at the market by good percentages. Moreover, it is expected to grow rapidly in certain segments that we will discuss further as of now , ITC is expected to grow by approximately 20% due to a stronghold in the Cg , wheat, paperboard, and hotel business. This push in the wheat and Agri industry is also because of the robust wheat export due to the Russian Ukraine crisis. Along with this as the covid crisis has settled down as compared to before, the education and stationery industry is also on a recovery track. Thus, this is also expected to lead ITC to a growth of 13- 14 %. All these combined together have played a major role in taking ITC to this new all-time high and may also push it further.

ITC Current Market Price – ₹ 295.45