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Yes Securities Report
Tata Motors Ltd.'s Q1 FY25 consolidated results were operationally in-line to street while better to our estimates with Ebitda beat ~7.4% with consolidated margins at 14.4% (estimate: 13.8%). Deleveraging is on track with net auto debt stood at ~Rs 186 billion (versus ~Rs 160 billion in FY24 and Rs 437 billion in FY23.
Tata Motors did maintain Ebit guidance at ~8.5% for FY25E (versus 8.5% in FY24), is despite it called out production constraints in Q2/Q3 led by plant shut down and floods at key aluminum supplier.
This we believe is key to watch for as the Ebit margins guidance are largely hinges on volumes given key margins drivers such as-
peak LR contribution,
raw material tailwinds and
controlled VME is now moderating QoQ given demand challenges cropping up in key markets like Europe, UK and China while the U.S. is still strong.
This reflects in order book at ~104,000 units in Q1 FY25 (versus ~133,000 at end of FY24, 150,000 in Q3 and 168,000 in Q2).
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