26 Jul 2022 , 08:55 AM
Result date: 27th July, 2022
Recommendation: Buy
Target price: Rs550
It is likely to be a mixed performance for Tata Motors during the June 2022 quarter. Company has seen healthy traction in its India business with strong growth in passenger vehicles and commercial vehicles. Domestic business volumes have surged 102% over the year-ago quarter partly due to a low base effect. Sequentially, though, volumes are down 5%. Volumes of JLR remained weak owing to chip shortages. Consolidated revenue could grow 6.8% over the year-ago quarter and decline 9.6% sequentially.
EBITDA margin could come in at 8.7%, up 79 basis points over the year-ago quarter and down 244 basis points sequentially. Price hikes are the key margin tailwinds while rising input costs and negative operating leverage are prominent headwinds.
On a consolidated as well as standalone basis, Tata Motors is likely to post net loss during the quarter.
Important management insights to watch out for:
· Demand trends across domestic and international markets
· Commentary on availability of chips
· Outlook on return to profitability
Rs. Million | June 2022 estimates | YoY change | QoQ change |
Revenue | 709,233 | 6.8% | (9.6)% |
EBITDA | 61,752 | 17.5% | (29.4)% |
Profit After Tax | (20,695) | NM | (1580.8)% |
Source: IIFL Research
NM: Not Matchable
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