Tesla Car In India: What It Means For Auto Stocks And The EV Industry
After much anticipation, delay and controversy, the American electric vehicle giant, Tesla, has finally hit the Indian markets on 15 July 20251. The company inaugurated its 4,000 square foot showroom in the Bandra Kurla Complex (BKC) of Mumbai. Reports anticipate the establishment of Tesla Experience Centres in major metropolitan cities, including Delhi, following the Tesla India showroom in Mumbai.
Currently, the only Tesla car in India, showcased at the Mumbai showroom, is the Tesla Y SUV imported from Shanghai. Experts claimed the Mumbai showroom, with its plush INR 35 lakh per month rent, is a strategic move to test the probable synthesis between Tesla and the Indian automobile industry.
As the Indian EV space expects a growth of CAGR 66.52% to reach USD 113.99 billion by 2029, market participants cannot help but wonder about the impact of a Tesla car in India.
EV Market India 2025 And The Impact Of Tesla
In case you think we are overplaying this, let us put things into perspective before getting into the actual impact of a Tesla car in India on the automobile industry.
While the Indian automobile industry in 2024 was valued at USD 122.53 billion, the market capitalisation of Tesla at the end of 2024 was recorded at USD 1.385 trillion2.
It is important to note that the auto industry valuation of India is based on actual output and revenue, while the market cap of Tesla reflects the total value of its shares. The massive scale of Tesla is proof of its potential impact on the fourth-largest auto producer in the world3.
Let us now understand the Tesla effect on the Indian market.
1. Indian EV Infrastructure To Expand
The EV landscape is incompetent with an optimal tertiary sector in the form of charging stations. According to the latest information, dated 1 April 2025, India has 26,367 charging stations4. However, studies show that by 2030, India will need around 1.32 million charging stations. This amounts to an average addition of 4,00,00 charging stations annually.
Although Tesla comes with a built-in charger and mobile connector, along with an option of wall connectors, a robust EV charging industry is necessary to support the business. Moreover, given that the government often supported the EV space through its policies, the entry of a prominent player like Tesla might indicate EV charging infrastructure investments in the future.
Tesla cars in India might not only push the government to stronger action, but also instil greater vigour among the industry.
2. Higher Benchmark For Indian EV makers
Amongst the top ten prominent countries of the EV space, India recorded the slowest EV growth in FY245. The EV infrastructure in India showed participation of both legacy brands, like TATAs and startups, like Ather. However, slowing growth in the EV sector can be traced to multiple factors, from waning investor interest to an unpredictable consumer base.
The entry of a globally renowned brand like Tesla could breathe new life into India’s EV market. It may not only reignite investor and consumer interest but also push Indian players to raise their game, setting the stage for more innovation and healthy competition.
| Company | On-Road Price (INR Lakhs) | Range (km) | Battery Capacity (KWh) |
| Tata Harrier EV | 22.58 - 31.91 | 538 - 627 | 65 - 75 |
| Mahindra XEV 9e | 23.01 - 34.03 | 542 - 656 | 59 - 79 |
| MG Windsor EV | 14.75 - 19.26 | 332 - 449 | 38-52.9 |
| Tesla Model Y | 60.49 - 74.63 | 500 - 622 | 60-75 |
An increase in market benchmark implies improved product quality for customers. However, although Tesla has premium features that have aided its rise as the market leader, one unique roadblock might hinder its growth in India.
3. India’s EV Import Duties And What They Mean For Tesla
The Tesla Model Y price in India starts from INR 59.89 lakhs6. However, the six Tesla cars in India are imported from Shanghai. Moreover, it is a completely built unit (CBU), implying that none of its features are made in India. Owing to various policies, India charges a steep 70% to 100% import duty on such variants.
The table below shows the steep impact of the import duty.
Tesla import duties in India |
Cost of the Tesla car in the US = INR 32 lakhs (Roughly)7 |
The Tesla CEO, Elon Musk, has been vocal about his reservations on the high import duties.
However, he has even confirmed that domestic production might be likely if Tesla succeeds in India, irrespective of imports. Given India’s commitment to the growing EV space, a promise of domestic production might aid in relaxations. Similar to how Apple received sourcing relaxation as a support to domestic production8.
Now, given that the entry of Tesla seems like a net positive, let us look at the top Indian EV stocks that investors should watch out for.
Indian Auto Stocks To Watch
The EV space has grabbed headlines again due to the entry of Tesla, which might aid in engaging investor focus again, especially in the premium EV sector.
The table below lists the best EV stocks in India.
| Particulars | Tata Motors | Mahindra & Mahindra |
| Market Capitalisation (? Crore) | 249787.40 | 397211.46 |
| P/E Ratio | 8.85 | 30.72 |
| One Year Return (%) | -33.51 | 15.95 |
| Net Profit Margin (Quarterly) | 7.51 | 8.31 |
Moreover, with a 62.44 lakh trade volume as on 16 July 2025, the five-year return delivered by TATA Motors is 44.9%9.
In the case of Mahindra & Mahindra, with a trading volume of 28.93 lakhs as on 16 July 2025, the company has delivered a five-year return of 40.3%10.
The Tesla impact on the Tata Motors share price, along with other EV stocks, is not the only aspect investors should notice. Along with actual EV makers, indirect beneficiaries might include the ancillaries to the industry, like component and battery suppliers. Exide and Bharat Electronics are two key players in this segment, based on their market capitalisation as of 16 July 202511.
Understanding the EV stocks is not enough; some key strategies to invest in EV market India are also important.
Investment Takeaway For Indian Retail Investors
This might seem like a good opportunity for you as an investor, however, before preparing a strategy to take advantage of new Tesla car in India, take a look at these key highlights:
1. Luxury EVs: Currently, India does not have a luxury EV segment. However, the entry of a company like Tesla might create a new niche segment in the future. Noting the emergence of the luxury EV India stocks might be worth extra attention.
2. EV Growth: The expansion of the EV sector not only impacts EV manufacturers but also has the potential to create a dynamic economic shift across the economy. Development of infrastructural facilities, like charging stations, along with policy changes in case duties, can have a ripple effect across sectors. Therefore, not just market securities like stocks, a fixed income investment for EV growth can also be a viable option.
3. Smart Investing: In addition to the above point, it is necessary to stay true to an individual investment philosophy and goal. Therefore, individuals seeking fixed income from investments can also take advantage of these trends through EV investment options other than stocks. Green bonds, thematic mutual funds, etc, can aid in such investment.
Conclusion
Tesla’s entry into India is more than just a brand launch, it signals a potential shift in the electric vehicle landscape. Despite hurdles like high import duties and limited infrastructure, long-term tailwinds such as policy support and renewed investor interest could reshape the EV industry and boost auto stocks in India.
For investors, this is a time to watch closely and diversify wisely. Whether you're tracking EV stocks, exploring green bonds, or seeking exposure to clean mobility, Tesla’s arrival may unlock new opportunities.
And if you are looking for stable returns from the EV boom without the volatility of stocks, platforms like Grip Invest offer curated fixed-income options linked to electric mobility and clean energy.
FAQs On Tesla Car In India
1. Will Tesla’s showroom affect Tata Motors’ stock?
In the short term, Tesla’s showroom won’t impact Tata Motors much as they target different segments. But long term, it could push Tata to innovate faster as EV competition and demand heats up.
2. How expensive is the Tesla Model Y in India?
The Tesla Model Y is expected to cost INR 70–INR 85 lakh (ex-showroom), placing it firmly in the luxury EV segment. Prices could drop if Tesla starts local manufacturing in India.
3. Which Indian stocks benefit most from Tesla’s entry?
Tesla’s entry could boost demand across the EV value chain in India. Here are some key beneficiaries:
- Sona BLW, Motherson Sumi – Leading EV component makers that could see higher global demand.
- Tata Elxsi – A major player in automotive software and EV design services.
- Exide, Amara Raja – Battery manufacturers positioned to benefit from rising EV adoption and infrastructure development.
- Tata Power – Expanding EV charging infrastructure, which aligns with Tesla’s market entry.
These companies and platforms stand to gain as India’s EV ecosystem grows in response to Tesla’s presence.
References:
1. NDTV, accessed from: https://www.ndtv.com/india-news/tesla-opens-first-showroom-in-india-all-about-mumbai-store-8876445
2. Companies Market Cap, accessed from: https://companiesmarketcap.com/tesla/marketcap/
3. NITI Aayog, accessed from: https://www.pib.gov.in/PressReleasePage.aspx?PRID=2120977
4. Ministry of Heavy Industries, accessed from: https://www.pib.gov.in/PressReleasePage.aspx?PRID=2118894
5. The Economic Times, accessed from: https://economictimes.indiatimes.com/industry/renewables/indias-ev-growth-is-significantly-lower-than-top-10-countries-report/articleshow/122086758.cms?from=mdr
6. NDTV, accessed from: https://www.ndtv.com/india-news/tesla-opens-first-showroom-in-india-all-about-mumbai-store-8876445
7. Financial Express, accessed from: https://www.financialexpress.com/trending/rs-29-lakh-tax-on-tesla-model-y-triggers-online-uproar-viral-post-says-us-pays-50-less/3915942/
8. The Economic Times, accessed from: https://economictimes.indiatimes.com/news/economy/policy/apple-given-relaxation-in-sourcing-for-first-three-years-government/articleshow/53420487.cms?from=mdr
9. The Screener, accessed from: https://www.screener.in/company/TATAMOTORS/consolidated/
10.NSE, accessed from: https://www.nseindia.com/get-quotes/equity?symbol=M%26M
10. The Screener, accessed from: https://www.screener.in/company/EXIDEIND/consolidated/
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