10 May 2023 , 10:11 AM
Result date: 12th May, 2023
Recommendation: Buy
Target price: Rs. 540
Tata Motors is likely to put up a robust performance in the March 2023 quarter. Analysts at IIFL Capital Services expect its consolidated revenues to grow 35% over the year ago quarter and 20% sequentially. JLR volumes (ex-China JV) grew 24% over the year-ago quarter and 19% sequentially. Product mix stood strong with share of “RR + RR Sport and Defender” flattish sequentially at 64%. The company’s standalone volumes grew 3% over the year-ago quarter and 10% sequentially.
Operating leverage and lower discounts in trucks are key margin tailwinds while fall in China’s share sequentially, from 14.6% to 12.7% is a prominent margin headwind. Tata Motors’ consolidated EBITDA margin could grow 174 basis points over the year-ago quarter and 199 basis points sequentially.
The company’s consolidated Profit After Tax (PAT) could jump significantly during the quarter, partly due to a low base and partly reflecting the strength witnessed in revenue and margins.
Important management insights to watch out for:
March 2023 estimates |
YoY change |
QoQ change |
|
Revenue (Rs. Million) |
1,061,960 |
35.4% |
20.0% |
EBITDA (Rs. Million) |
136,872 |
56.6% |
41.9% |
EBITDA Margin (%) |
12.9% |
174 bps |
199 bps |
Profit After Tax (Rs. Million) |
44,619 |
3092.7% |
150.5% |
Source: IIFL Research
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