Delhi's Draft EV Policy Could Reshape Two-Wheeler Markets — Here Are the Winners and Losers

Delhi's Draft EV Policy Could Reshape Two-Wheeler Markets — Here Are the Winners and Losers

Delhi's draft EV policy, released on April 13, proposes a phased ban on petrol-powered two-wheelers and offers Rs 1 lakh scrappage incentives along with tax waivers to accelerate the switch to electric vehicles. If other states follow Delhi's template — as they often do — the implications for India's auto sector are significant. We dug into company filings to separate the signal from the noise.

The Policy in Brief

The draft policy targets a complete phase-out of new petrol two-wheeler registrations in Delhi, alongside scrappage incentives of up to Rs 1 lakh for trading in old ICE vehicles. Tax waivers on EV purchases sweeten the deal further. The market responded immediately: EV stocks rallied while traditional two-wheeler makers fell up to 5%.

Winner: Ather Energy (ATHERENERG) — The Pure-Play EV Bet

Ather Energy is arguably the most direct beneficiary. Per their FY25 annual report, Ather sold 155,394 electric scooters in FY25, a 42% jump from 109,577 units in FY24. Revenue from sale of finished goods rose to Rs 19,984 million from Rs 15,819 million. Crucially, their revenue per scooter held at Rs 128,295 despite fierce industry discounting — showing pricing power in a premium segment.

Ather's market share in Delhi specifically climbed from 7.0% in Q1 FY25 to 11.8% by Q4 FY25 — and a petrol phase-out would obviously turbocharge that. Nationally, they reached 13.6% of the E2W market in Q4 FY25. Their EBITDA, while still negative, improved from -36% in FY24 to -23% in FY25, suggesting the path to profitability narrows as volumes scale.

Ather's own filing projects the E2W market will grow at roughly 41% CAGR, potentially accounting for 35% of all two-wheeler sales by FY31.

Winner: Bajaj Auto (BAJAJ-AUTO) — The Chetak Pivot Is Paying Off

Bajaj Auto's transformation is underappreciated. Per their Q2 FY25 quarterly results, the company's Green Energy portfolio now contributes approximately 45% of revenues, up from 30% the prior year. Chetak EV volumes hit roughly 100,000 units in a single quarter, and the EV segment moved from a loss to marginally positive EBITDA — a significant milestone.

Bajaj's overall financial strength (Q1 FY24 revenue at a record Rs 10,310 crore, EBITDA margin at 19%) gives them the firepower to absorb the EV transition. Their stated strategy of balancing the ICE margin drag with EV growth positions them well for policy-driven acceleration.

Winner: Olectra Greentech (OLECTRA) — Riding the E-Bus Wave

While the Delhi policy focuses on two-wheelers, Olectra benefits from the broader electrification push. Per their FY23 annual report, E-Bus division revenue nearly doubled to Rs 943.99 crore from Rs 485.21 crore the previous year. They also launched an E-Truck division (Rs 22.95 crore in its debut year) and developed a hydrogen fuel cell bus prototype in collaboration with Reliance Industries.

As more cities follow Delhi's lead on clean transport, Olectra's first-mover advantage in electric buses — where they are the largest pure-play manufacturer — becomes increasingly valuable.

At Risk: Hero MotoCorp (HEROMOTOCO) — ICE Dominance Becomes a Liability

Hero MotoCorp is India's largest two-wheeler maker, but their dominance is concentrated in exactly the segment Delhi wants to phase out. Per their quarterly results, Hero commands over 70% market share in the entry-level 100/110cc ICE segment through brands like Splendor, Passion, and HF Deluxe.

Their EV effort, the VIDA V1 scooter, was launched but remains nascent. In their Q4 FY23 results, management noted they were expanding VIDA distribution to 100 cities but admitted the recent price revision was needed to make it "accessible to more customers." With Q4 FY23 standalone revenue at Rs 8,307 crore, Hero is highly profitable but overwhelmingly dependent on ICE. A regulatory push against petrol two-wheelers hits them harder than any other major OEM.

At Risk: Eicher Motors (EICHERMOT) — No EV Product Yet

Eicher Motors, the parent of Royal Enfield, has explicitly acknowledged the need to "balance the existing product portfolio of ICE and the transition into the future with electric" per their FY23 annual report. But unlike peers, Royal Enfield has yet to launch a commercial EV product. While they operate in the premium motorcycle segment that may be affected later than commuter scooters, the direction of policy is clear. Their FY24 annual report shows they are investing in the transition, but products remain in development.

The Second-Order Play: JBM Auto (JBMA) — Electric Bus Infrastructure

JBM Auto's OEM division delivered Rs 3,053 crore in revenue in FY24. Through subsidiaries like JBM EV Technologies and Ecolife Green Mobility, they are building electric bus operations across multiple Indian states under the PM eBus Sewa scheme. Delhi's aggressive EV stance signals that the public transport electrification push — which directly benefits JBM — has strong political support.

What Retail Investors Should Do

This is a draft policy, not law. But the direction is clear, and Delhi often sets the template for other states. Investors should think in two time horizons:

Near term (6-12 months): Watch for other state governments announcing similar EV mandates. Each announcement is a catalyst for EV pure-plays like Ather. Monitor Bajaj Auto's quarterly Green Energy revenue mix — if it crosses 50%, the market may need to rerate the stock as an EV company rather than an ICE one. Medium term (2-3 years): The real risk is for Hero MotoCorp and Eicher Motors. Hero's massive ICE base generates strong cash flows today, but the VIDA brand needs to prove it can scale. If EV penetration hits 20% in two-wheelers, Hero's economics change materially. Eicher needs to get a product to market.

The scrappage incentive is the most immediately actionable part of the policy — it creates real demand today, not theoretical demand in 2030. Companies with products on the ground (Ather, Bajaj's Chetak) capture that demand. Companies still in R&D (Eicher) don't.

Data sourced from company filings on NSE via Xaro.