Indian billionaire investor Rakesh Jhunjhunwala is betting on carmaker Tata Motors as one of the winners of India’s growing electric vehicle market.
“I think the biggest and best player in electric cars in India is going to be Tata Motors,” Jhunjhunwala told CNBC’s Street Signs Asia on Tuesday.
“I’m a big shareholder in Tata Motors. I’m playing the EV story through Tata Motors,” the investor said.
He explained that valuation will not ultimately decide who will win the race for electric vehicles. Instead, large enterprises with manufacturing and investment capabilities, distribution channels, production experience and the ability to design good cars will eventually emerge, according to Jhunjhunwala.
“I think it’s going to be the Mercedes, the Volkswagens and the Tata Motors, who are going to be the real winners in the electric race,” he said. the cars for Indian road conditions – for example the ability to drive the cars on flooded roads.
India is also a cost-conscious market where the use of electric vehicles probably depends on the kind of incentives the government gives, the investor explained. Infrastructure, such as charging stations, have yet to be built for widespread acceptance. But, Jhunjhunwala said, India is “ready like any developing country, but I think the pace of readiness will increase like anything.”
Both Tata Motors and rival Mahindra & Mahindra already sell electric vehicles. The American giant for electric vehicles Tesla is apparently preparing to open a manufacturing unit for electric cars in South India.
Signs for Tata Motors will be displayed on January 27, 2018 at the company’s headquarters in Mumbai, India.
Dhiraj Singh | Bloomberg | Getty Images
The diversified financial services firm Motilal Oswal told CNBC this month that the excitement in the Indian market for electric vehicles comes from additional spaces such as the manufacture of batteries.
Among the carmakers, the firm said it preferred Maruti Suzuki – India’s largest manufacturer – because of its strong distribution network, although Maruti itself has not yet been so excited about electric vehicles.
India is both trying to reduce its dependence on oil and improve its air quality. This is likely to cause electric vehicles to push.
Reuters reported last year that India has potential plans to raise $ 4.6 billion for businesses that set up advanced battery-making facilities as part of its efforts to promote the use of electric vehicles. The country had earlier approved a scheme to subsidize the sale of electric and hybrid vehicles.
In the month’s annual budget for the financial year beginning on April 1, India announced a voluntary vehicle clean-up policy to phase out old vehicles that contribute to the poor air quality in the country.