Indian EV market to reach more than USD 150 billion by 2030, RBSA Advisors

Leading valuation and consulting firm RBSA Advisors expects the Indian EV market to reach a size of more than USD 150 billion by 2030. The Indian EV market is currently in its infancy and is estimated grow at CAGR of ~90% from 2021 to 2030. In terms of penetration, EV sales accounts for barely 1.3% of total vehicle sales in India during 20-21. However, the market is growing rapidly and is expected to be worth more. India’s shift to shared, electric and connected mobility could help the country save nearly one giga-tonne of carbon dioxide emissions by 2030.

RBSA Advisors today released its first part of its three- part report on EV sector, ‘ Powered by Power- The EV Industry in India’. The report states that EV technology evolution in India, requires sizable investment in R&D and product development, both on the automobile platforms and battery/charging technology. Collective investment done by 2W, 3W, 4W, EV component makers and last mile delivery companies was recorded at INR ~25,000 crore. during January– July 2021. The demand incentives provided under FAME 11, the launch of state policies, rising fuel prices, tightening emissions laws and increasing awareness of the green environment are few factors making the sector attractive to larger automobile players and financial investors.

Rajeev R. Shah Managing Director & CEO, RBSA Advisors, “EV sales are likely to increase exponentially in the coming days. With the only certainty over the future prices of diesel/petrol being that they are unlikely to reduce soon, more choices being made available to the consumer in terms of electric vehicles and initiatives by the Central and State Governments, the sector is expected to attract huge investments as well. Each of the last three years have seen double digit deals and we expect this trend to continue.”

Recently, Ola electric raised $200 million from a clutch of investors in a fresh funding round, valuing the company at more than $5 billion. TPG Rise Climate and Abu Dhabi’s ADQ investment of $1 billion in Tata Motor. This is the first major fund-raising by an Indian car-maker to push clean mobility. While electric scooter rental start-up Bounce is reportedly making investments of about $100 million (around Rs 742 crore) over the next 12 months across manufacturing of e-scooters and expanding the battery swapping infrastructure.

Adds Rajeev Shah, “While many start-ups have raised an initial round of funding during the last three years, they are likely to go in for stabilisation and are hence likely to need funds. Further with the sector gaining critical mass and the traditional auto players also looking at the sector with avid interestand we are likely to see many more deals in the sector for at least the next few years. It is expected that if India is to achieve its 2030 target ias far as e mobility is concerned, a cumulative investment of nearly $200 billion will be needed. ” Further, an accessible and robust network of EV charging infrastructure is an absolute pre-requisite.

The reports estimates that India needs about 400,000 charging stations to meet the requirement for two million EV that could potentially ply on its roads by 2026. To cater to this huge demand, an integrated work approach between the private sector and public sector is required.PSUs have been active in this regard in terms of providing the much needed charging infrastructure.

According to the government’s estimates, India will need a minimum of 10 GWh of Li-ion cells by 2022, about 60 GWh by 2025 and 120 GWh by 2030.  As per Niti Aayog estimates, India can rise among the top countries in the world in manufacturing batteries. India’s market for EV batteries alone could be worth as much as USD 300 billion from 2017 to 2030 and it could represent more than one-third of global EV battery demand by 2030 if the country meets its goals for a rapid transition to shared, connected and electric mobility.

Globally, despite the Covid-19 pandemic related worldwide downturn in car sales wherein global car sales dropped by 16% in 2020, strong demand and momentum was seen in the global EV market where around 3 million electric cars were sold. CYH1-21 sales were dominated by Mainland China and Europe. China saw 1.1 million vehicles being sold with Europe being behind by just 10,000. It is an established fact that EVs are now the vehicles of the future and it is Power that will Power us ahead as far as mobility is concerned.

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