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EV Investment in India
The number of car companies making their own electric vehicles and models, electric charging ports & stations, electric bikes for delivery riders and essential workers are growing rapidly, just like EV investment in India.
The Transportation Industry is Changing
The winds of change are blowing and here, and yes, they all smell electric. Electric Vehicles are spearheading a revolution in just the transportation sector, but also the alternative investments sector, with more and more people throwing money into EV investments in India.
And for good reason. In a country as huge and populous as India, especially with rising petrol and diesel prices, EVs are making their mark in India, and the EV investment landscape is keenly taking note of it.
How Big is the EV Investment Market?
As per a report by Strait Research, the Indian electric vehicles (EV) market size was valued at USD 8,574.45 million in 2022.
The current market size, in 2024, is Eves estimated to be USD 34.80 billion, with a projected growth to USD 110.74 billion by 2029, representing a Compound Annual Growth Rate (CAGR) of 26.05% during the forecast period.
This is as per a report by Mordor Intelligence.
Based on a number of different reports with various forecasting periods, all of them are certain of one thing: By the end of the decade, The market of EVs and EV Investment in India will go way beyond USD 100 billion.
That being said, what exactly is the huge buzz around investing in EVs? And why is everyone, from Shark Tank investors to big Indian conglomerates investing in them?
Why The EV Sector in India is Growing & Investors Should Take Note
Environmental Concerns
Climate change and air pollution are important global problems. Old-style cars with internal combustion engines create greenhouse gases and other pollutants, leading to damage in the environment and health worries for people.
Electric vehicles provide a cleaner option because they do not emit any tailpipe emissions. Governments worldwide are enacting stricter regulations to curb emissions, incentivizing the adoption of EVs.
Consumer Awareness
Rising understanding about environment problems and the advantages of EVs is affecting consumer choices. Many shoppers are now more likely to favor sustainable and eco-friendly products, such as electric vehicles.
Furthermore, the selection of EV styles and characteristics is increasing along with better performance in driving which draws a wider group to this market.
Government Initiatives
The Indian government has set ambitious targets to promote electric mobility. This includes a Favor lofty goal of 30% electric vehicles by 2030, which corporates and industrialists alike are trying hard to achieve.
These goals are not just statements made in air, they’re supported by policies & incentives like the FAME II scheme, which provides subsidies for EVs, and encourages more investment in EVs in India & the EV market.
Diversification Benefits For Your Portfolio
Investing in the EV sector and the alternative investments sector provides you with a number of diversification benefits.
You’ll be exposing your alternative investment portfolio to a high-growth, technology driven industry, rather than being limited to traditional automobile companies and their stocks.
High Return Potential
As we’ve seen the rapid rate in which the EV market in India continues to expand, companies which are involved in electric vehicle production, batteries, and changing infrastructure could see their stock prices rise, and If you’re investing in them, that means lots of high returns for you as well.
Understanding Market Potential
As mentioned earlier, the current market size is around USD 34.80 billion in 2024, rising to USD 110.74 billion by 2029, representing a Compound Annual Growth Rate (CAGR) of 26.05% over the forecast period.
This growth is being aided through the aforementioned factors such as government policies, raising environmental concern, and increasing adoption of electric vehicles in the market.
And as per fortune business insights, In 2023, Uttar Pradesh had the most significant portion in EV sales.
The total units sold across all segments in Uttar Pradesh were 2,77,837; Karnataka sold 1,52,324 units and Tamil Nadu sold 90,241 units. In terms of three-wheelers segment UP was on top while for two-wheelers and four wheelers it was Karnataka and Maharashtra respectively.
The Future of The Automobile Industry is Here
The automotive industry, after a very long time, is undergoing a paradigm shift. Established players and new entrants alike are ramping up their EV offerings, with electric variants of popular models hitting the market.
The infrastructure is changing too. Investing in EV charging stations has emerged as a lucrative opportunity, companies are vying to establish a network of charging points across the country.
Investors are looking for smart charging solutions that offer convenience, reliability, and efficiency. It’s not just about quantity, quality matters too.
Bottom Line: The Perfect Opportunity to Invest in EVs
Speaking of investors, there’s a number of different types of investments flooding the EV sector. It’s not just traditional venture capital firms who are getting in on the action. There’s a surge in alternative investments, including private equity, hedge funds, alternative investment platforms, even crowdfund platforms.
The allure of EVs lies not only in their potential for financial returns but also in their alignment with environmental and social objectives.
From compact city cars to robust SUVs, there’s an electric option for every type of driver. This diversification of EV offerings is not only expanding consumer choices but also fuelling investor confidence in the market.
