These auto stocks are Jefferies’ top buys — Do you own? – CNBC TV18

The shares of Indian automakers were in focus on December 11 as Jefferies shared a brokerage note stating its preferred buys and the outlook going into 2025. Mahindra and Mahindra, TVS and Eicher Motors remain Jefferies’ preferred stocks though it acknowledged valuations are not cheap for most stocks but multiples will remain elevated.

The brokerage pointed out that despite sharp valuation re-rating in M&M in 2024, the stock trades at 24x FY26 core business earnings. It finds M&M attractive in the context of 19% earnings per share (EPS) compound annual growth rate (CAGR) over FY24-27 and rising market share.

The brokerage note comes days after the carmaker revealed its electric origin SUVs the BE 6 and XEV 9e on November 26, 2024.

Jefferies also said that TVS with 35 times FY26 P/E is highest among covered OEMs and that it expects the two wheeler maker to deliver highest EPS CAGR at 30% over FY24-27. As of November, TVS Motor Company held 16% market share among two wheelers, according to monthly data released by the Federation of Automobile Dealers Association (FADA). Also, TVS is steadily upping its game in the electric two wheeler segment.

Jefferies’ other preferred auto pick is Eicher Motors. After 40% underperformance versus Nifty Auto since January 2023, the stock looks attractive, the brokerage said.

Among Jefferies picks, M&M has given a return of more than 85% in the past year, TVS Motor has risen 31% whereas Eicher Motors has made investors about 20% wealthier.

Track latest stock market updates on CNBCTV18.com’s blog here