Electric vehicle market and stocks

India’s push towards electric vehicles is creating opportunities for businesses in ancillary spaces such as battery manufacturing, according to an analyst at diversified financial services firm Motilal Oswal.

The shift to electric vehicles is “inevitable” around the world as well as in India, where rising fuel prices can make owning electrically powered cars relatively more affordable, said Siddhartha Khemka, head of the government on Monday. research for retail, on CNBC “Street Signs Asia”. “

“Acceptability will increase once you have the infrastructure,” he said.

There are two basic types of electric vehicles: those that rely on batteries and hybrid vehicles that use both batteries as well as plugging into an external power source, such as a charging station.

Much of the excitement in India’s electric vehicle industry is in the ancillary spaces where companies work with global players, many of whom are looking to break into the lucrative market, according to Khemka.

“On the one hand you have the battery manufacturers, who are looking to develop the battery for electric vehicles, and on the other hand, you have companies like Motherson Sumi, which are interested in the electrical part of vehicles”, he said, adding: “They are getting more and more market share in the world thanks to the (electric vehicle) space.”

Khemka said Motilal Oswal preferred Motherson Sumi and Exide Industries, which are up around 29% and 11% year-to-date through Monday’s close, respectively.

Motherson Sumi works with automakers around the world in areas such as wiring harnesses, mirrors, cockpits, bumpers and more. Exide sells lead-acid batteries for automobiles and industry.

The electric vehicle sector in South Asia’s largest economy is expected to receive a boost from Tesla.

Last month, the American company incorporated Tesla Motors India and Energy Private Limited with a head office in the Bengaluru Technology Center in Karnataka, Reuters reported. The newswire reported on Sunday that a state government document claimed Tesla would open an electric car manufacturing unit in Karnataka.

CEO Elon Musk previously said on Twitter that Tesla cars will be available in the country from this year.

For its part, India is trying to reduce its dependence on oil and also reduce air pollution. This can boost the push towards electric vehicles. In the last annual budget, the Minister of Finance announced a voluntary vehicle scrapping policy to dispose of old vehicles that contribute to the country’s poor air quality.