TVS Motor Q3 Results Review - Further Aggression On EV Expansion: Prabhudas Lilladher

Prabhudas Lilladher Report

TVS Motor Company Ltd.'s Q3 FY24 revenue was largely in-line versus our and consensus estimates, while Ebitda margin beat our estimate (it was in-line vs consensus). Higher export realisation, favorable input cost and better product mix helped on the margin side.

TVS Motor plans to ramp-up its electric vehicle volumes with network expansion (doubling in a quarter) and product expansion in FY25 in domestic market and also export EVs globally.

Urban demand was strong for the industry which TVS Motor believes should continue, while rural demand has shown initial signs of pick-up. On exports side, recovery has not been as expected, however, worst seems to be behind us.

We believe TVS Motor is well placed to outperform the industry given-

1. good tractions for new product launches in ICE and electric vehicle segments and

2. higher focus on exports, premiumisation and margin improvement helped by cost control, operating leverage, benign input prices and production linked incentive benefits (likely to offset impact from higher EV mix).

We slightly tweak our FY25/FY26E EPS estimates to incorporate Q3 beat on margins and management commentary. Retain ‘Hold’ with target price of Rs 1,955 (earlier target price at Rs 1,950) at 30 times Dec-25E EPS including Rs 68 for TVS credit, as we see all positives to be priced in at current valuations.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.