TVS Motor Shares: GST Cut To Boost Rural Demand, But Stock May See Near-Term Swings, Says SEBI Analyst

TVS Motor shares traded lower on Tuesday on profit booking across the auto sector. This comes after recent gains across auto stocks, driven by the government's cut in GST on two-wheelers, which makes bikes and scooters cheaper and more appealing to buyers in one of the most price-sensitive parts of the auto market.

SEBI-registered analyst Deepak Pal said the tax cut is a clear positive for TVS Motor, which sells everything from scooters to commuter bikes and premium motorcycles. 

He noted that the impact will be felt most in rural and semi-urban markets, where affordability often decides whether people go ahead with a purchase.

Short-Term Impact

According to Pal, the tax cut has lifted sentiment for auto stocks and made TVS Motor a direct beneficiary. 

However, with the stock already running up in recent sessions, he warned that near-term swings and profit-taking are likely, even if investors are betting on stronger sales ahead.

Medium To Long-Term Impact

Pal believes the lower GST can help two-wheeler demand recover in a lasting way, bringing down ownership costs across all categories. 

That could push up sales, which in turn would improve margins and revenues as long as raw material prices such as steel, aluminium, and rubber don't climb too high. Over time, he said, stronger volumes and profitability could give TVS better earnings visibility, more market share, and potentially a higher valuation.

Technical View

Pal also pointed to a breakout above ₹3,500, with the stock showing plenty of momentum. The relative strength index (RSI) at 86 signals strength but also hints that the stock is overheated, raising the chance of a breather. 

Prices remain well above major moving averages, while Parabolic SAR and MACD both back the bullish trend. If the stock stays above ₹3,500, Pal sees room for a move to ₹3,740–3,750 over the next month or two. 

On the downside, dips near ₹3,540–3,550 could offer buying opportunities, though he cautioned that at current levels the upside-to-risk ratio isn't ideal for fresh entries.

What Is The Retail Mood?

On Stocktwits, retail sentiment was 'bullish' amid 'normal' message volume.

TVS Motor's stock has surged 643% so far in 2025, supported by strong financial performance, aggressive product launches, and robust investor sentiment. 

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