EBITDA margin expanded by 120 basis points to 13.1%, supported by economies of scale, favourable mix and ongoing cost-optimisation initiatives.
28 Jan 2026 | 228 Views | By Arunima Pal
TVS Motor Company reported a strong set of results for the third quarter ended December FY26, with operating performance exceeding market expectations, driven by robust volume growth, improved realisations and margin expansion. The two-wheeler maker’s EBITDA came in above consensus estimates, prompting a likely positive reaction from the market.
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TVS Motor Company reported a strong set of results for the third quarter ended December FY26, with operating performance exceeding market expectations, driven by robust volume growth, improved realisations and margin expansion. The two-wheeler maker’s EBITDA came in above consensus estimates, prompting a likely positive reaction from the market.
Revenue for the quarter rose 37% year-on-year to ₹124.8 billion, marginally ahead of analyst expectations, as overall volumes increased 27% to 1.54 million units. Average realisation per vehicle improved 8% to ₹80,781, reflecting a better product mix and price discipline.
Operating profit surged 51% year-on-year to ₹16.3 billion. EBITDA margin expanded by 120 basis points to 13.1%, supported by economies of scale, favourable mix and ongoing cost-optimisation initiatives.
Profit after tax jumped 59% year-on-year to ₹9.8 billion, though it came in slightly below estimates due to a one-off impact in other income. The company reported a loss of ₹280 million under other income, largely on account of a ₹320.5 million loss arising from fair valuation of an investment held by the company.
Segmentally, TVS Motor’s financial services arm continued to deliver steady growth, with segmental profit rising 15.6% year-on-year to ₹3.8 billion during the quarter.
During Q3FY26, the company invested ₹9.1 billion in its subsidiaries, taking cumulative investments for the first nine months of FY26 to ₹19.4 billion, underlining its focus on strengthening group operations and long-term growth platforms.
The company also disclosed an exceptional item related to the implementation of the new labour code. A past-period employee benefit liability amounting to ₹413.7 million has been recognised as an exceptional expense during the quarter.
Management is scheduled to discuss the quarterly performance and outlook in an earnings call later today at 2:45 PM IST.
Outlook: Analysts remain positive on TVS Motor, citing expectations of a sustained recovery in the domestic two-wheeler market, continued market-share gains in both domestic and overseas markets, and further margin expansion driven by scale benefits, product mix improvements and cost-control measures. The stock continues to be rated ‘Buy’.