TVS Motor Q4 Results Review - Resilient Performance: Yes Securities

Yes Securities Report

TVS Motor Company Ltd.'s Q4 FY24 results were in line operationally as margins continues to be resilient at 11.3% (+100 bp YoY/ flat QoQ). Gross margin expanded ~260 bp YoY (+90 bp QoQ) at 27.2% led by favorable mix and benign raw material. Key operating metrics such as Ebitda/vehicle increased further to Rs 8700/unit (+11.4% YoY/ +3.8% QoQ).

Going ahead, margin expansion to continue given soft raw material and favorable mix. The management hinted at new launches both in ICE and EVs including variants of iQube and EV three wheelers in FY25E.

With iQube distribution expanded to ~712 stores in Q4 FY24 (versus more than 400 in Q3 FY24 and ~337 in Q2 FY24), the more launches planned (in 5-25 kwh capacity, both in two-wheeler and three-wheeler segments), indicating further EV ramp-up.

We continue to believe TVS Motor is better placed among two-wheeler OEMs both in ICE and EVs led by better product acceptability which should drive further market share gains.

However, we would remain watchful of the competitive launches in the 125cc segment and market share impact thereof.

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