Centre’s EV push puts electric mobility stocks in the fast lane; M&M, Ola Electric lead rally with gains of up to 5%

Shares of automobile and electric vehicle companies gained on Wednesday, November 11, following the Centre’s decision to make electric vehicles the default choice for staff-car procurement by government ministries and departments, while doubling the Net Dealer Price (NDP) ceiling for electric cars to Rs 20 lakh. Mahindra & Mahindra (M&M) and Ola Electric Mobility emerged among the top gainers in the sector, with the former leading the rally with an intra-day gain of nearly 5%.

M&M climbed 4.81% to touch an intra-day high of Rs 3,449, while Ola Electric Mobility advanced 3.53% to Rs 35.16.

Hyundai Motor India was another major gainer, rising 3.08% to an intra-day high of Rs 2,175, while TVS Motor Company gained 2.89% to Rs 4,636.10. Ather Energy advanced 2.40% to Rs 1,904.50.

Among other automobile companies, Maruti Suzuki India rose 2.10% to Rs 13,199, while Tata Motors Passenger Vehicles gained 2.03% to Rs 301. JBM Auto advanced 2% to Rs 511.95, while Bajaj Auto registered the lowest gain among the nine stocks, rising 1.28% to Rs 11,120.

At the last check, M&M was trading 4.5% higher, followed by TVS Motor Company, which was up 2.53%. Ola Electric Mobility gained 2.20%, while Hyundai Motor India advanced 2.3%. Maruti Suzuki India was up 2%, while Tata Motors Passenger Vehicles and Ather Energy gained 1.5% each. Bajaj Auto and JBM Auto were trading 0.5% higher each, while Ashok Leyland was flat.

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What does the Centre’s new EV procurement policy say?The Department of Expenditure (DEA), under the Ministry of Finance, has revised the Net Dealer Price (NDP) ceiling for the procurement of staff cars by government ministries and departments, doubling the limit for electric vehicles to Rs 20 lakh from Rs 10 lakh for internal combustion engine (ICE) vehicles.

Under the revised instructions, electric vehicles have been made the default choice for government staff-car procurement. Ministries and departments are directed to ordinarily procure EVs when purchasing or replacing their existing staff cars.

However, the revised instructions do not completely prohibit the purchase of conventional vehicles. Departments that consider EV procurement or deployment impractical can propose purchasing ICE vehicles, subject to justification and case-specific relaxation from the Department of Expenditure, with the required approvals.

Disclosure: This article has been written by Kumar Gaurav, who is not a Sebi-registered Research Analyst or an Investment Adviser. Gaurav and their ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective Sebi-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here