An analyst at diversified financial services firm Motilal Oswal says India’s pressure on electric vehicles is creating opportunities for businesses in additional spaces such as battery manufacturing.
Globally as well as in India, where higher fuel prices can make the use of electric vehicles relatively cheaper, the move to electric vehicles is inevitable, Siddhartha Khemka, head of retail research, said on CNBC’s “Street Signs Asia” on Monday. “
“Acceptability will increase once you have the infrastructure,” he said.
There are two basic types of electric vehicles: those that depend on batteries and the hybrid vehicles that use both batteries, as well as an external power source, such as a charging station.
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The biggest excitement in India’s electric vehicle sector is in additional spaces where companies work with global players, many of whom want to enter the lucrative market, according to Khemka.
“On the one hand you have the battery manufacturers who want to develop the battery for the EVs, and on the other hand you have companies like Motherson Sumi, which are part of the electrical part of the vehicles,” he said. “They are getting increasing shares worldwide from the (electric vehicle) space.”
Khemka said Motilal Oswal prefers Motherson Sumi and Exide Industries, which have increased about 29% and 11% annually since Monday’s closing.
Motherson Sumi works with automakers around the world in areas such as wiring harnesses, rearview mirrors, cabins, bumpers and more. Exide sells car and industrial lead-acid batteries.
Lots of traffic and crowds were observed the first weekend of 2021 in Kolkata, West Bengal, outside the Alipore Zoo.
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Boost from Tesla
The EV sector in the largest economy in South Asia is likely to get a boost from Tesla.
The US firm acquired Tesla Motors India and Energy Private Limited last month with a registered office in the Bengaluru Technology Center in Karnataka, Reuters reported. The news thread reported on Sunday that a state government document claimed that Tesla would open a manufacturing unit for electric cars in Karnataka.
CEO Elon Musk said earlier on Twitter that Tesla cars will be available in the country from this year.
In turn, India is trying to reduce its dependence on oil and also reduce air pollution. This can increase the pressure in electric vehicles. In the latest annual budget, the finance minister announced a voluntary vehicle collection policy to phase out old vehicles that contribute to the poor air quality in the country.