TVS Motor Acquires 39.11% Stake in DriveX Mobility, Strengthening Its Position in the Two-Wheeler Market

TVS Motor Acquires 39.11% Stake in DriveX Mobility, Strengthening Its Position in the Two-Wheeler Market

TVS Motor Company, one of India’s leading automobile manufacturers, has increased its stake in Narain Karthikeyan’s two-wheeler startup, DriveX Mobility, by acquiring an additional 39.11% for INR 97.78 crore (approximately $11.5 million) in an all-cash deal. With this acquisition, TVS Motor’s total stake in DriveX has now risen to 87.38%, making DriveX a subsidiary of the automaker. This strategic move is aimed at strengthening TVS Motor’s position in the digital-first, rapidly growing two-wheeler market.

Acquisition Details

On December 23, 2024, TVS Motor completed the acquisition of 7,914 equity shares, each with a face value of INR 10, from the existing shareholders of DriveX. The deal, valued at INR 97.78 crore, significantly enhances TVS Motor’s presence in the two-wheeler segment, particularly in the refurbished and digital space. This move is part of TVS Motor’s broader strategy to expand its portfolio and leverage emerging trends in the autotech and digital platforms for two-wheeler sales.

Following the announcement, TVS Motor’s shares experienced a nearly 2% rise during intraday trading, reaching INR 2,433.65 on the Bombay Stock Exchange (BSE). This uptick in TVS’s stock price reflects positive investor sentiment around the acquisition and the company’s future growth prospects with DriveX Mobility.

DriveX Mobility: A Digital-First Autotech Platform

DriveX Mobility, founded in 2020 by Narain Karthikeyan, India’s first Formula One driver, and his childhood friend Christopher Anand Sargunam, operates as a digital-first platform that focuses on the sale and purchase of refurbished two-wheelers. The company addresses the growing demand for cost-effective and sustainable options in the two-wheeler market by providing refurbished vehicles that meet high-quality standards.

In a market where demand for two-wheelers is surging, particularly in urban areas, DriveX has positioned itself as an innovative player by offering an online platform that simplifies the buying and selling of pre-owned and refurbished motorcycles and scooters. This aligns well with the increasing trend of online shopping and digital solutions in the automotive sector, making DriveX a valuable asset in the rapidly evolving autotech ecosystem.

Strategic Benefits for TVS Motor

For TVS Motor, the acquisition marks a significant strategic step in diversifying its portfolio, which includes motorcycles, scooters, and electric vehicles. By taking control of DriveX Mobility, TVS Motor gains access to a platform that leverages digital technology to facilitate the purchase and sale of refurbished two-wheelers—an area that is expected to see exponential growth as more consumers opt for affordable, sustainable alternatives to new vehicles.

The acquisition also gives TVS Motor the opportunity to tap into the burgeoning market for pre-owned two-wheelers, which is experiencing growing demand, especially among price-sensitive consumers. DriveX’s established platform and expertise in refurbishing two-wheelers make it an ideal complement to TVS Motor’s existing product offerings.

Future Outlook

With the majority stake in DriveX Mobility, TVS Motor aims to integrate DriveX’s platform into its broader strategy, utilizing its digital capabilities to further enhance customer engagement, streamline sales processes, and cater to the increasing demand for cost-effective two-wheelers. As the market for refurbished two-wheelers continues to grow, TVS Motor is well-positioned to capitalize on this trend and further consolidate its leadership in the Indian two-wheeler industry.

This acquisition is also in line with TVS Motor’s broader focus on sustainability and innovation, as it embraces the circular economy model by promoting the sale and purchase of refurbished vehicles, which contributes to reducing waste and promoting sustainability in the automotive sector.

Conclusion

TVS Motor’s acquisition of a controlling stake in DriveX Mobility marks an important development in the Indian automotive industry, particularly in the two-wheeler segment. By adding a digital-first platform for refurbished two-wheelers to its portfolio, TVS Motor is poised to meet the evolving demands of consumers, strengthen its position in the market, and expand its reach in the rapidly growing autotech space. With a growing focus on sustainability and digital solutions, this strategic acquisition is likely to play a key role in TVS Motor’s future growth and success.