Tube Investments of India Q2 Results Review - Inline; Mobility Business Dents Margin: Motilal Oswal

Motilal Oswal Report

Tube Investments of India Ltd.’s Q2 FY24 results were operationally in line, while a surge in other income led to adjusted profit after tax beat at Rs 1.8 billion (versus estimate Rs 1.7 billion).

During the quarter, all divisions, except for the mobility business, reported a YoY revenue growth.

We believe, underlying growth in two-wheeler and exports should drive revenue and margins recovery over the next few quarters to over 14% by Q4 FY24.

We maintain our FY24E/FY25E consolidated earnings per share estimates. Tube Investments of India trades at 53.2 times/44.2 times FY24E/FY25E consolidated earnings per share.

We reiterate a 'Buy' rating on the stock and a target price of ~Rs 3,630 (premised on December-25 SoTP).

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