Buy TVS Motor Company; target of Rs 422: ICICI Securities
ICICI Securities is bullish on TVS Motor Company has recommended buy rating on the stock with a target price of Rs 422 in its research report dated May 29, 2020.
ICICI Securities research report on TVS Motor Company
TVS Motor Company’s (TVSM) Q4FY20 operating performance was above consensus estimates (Adj. EBITDA margin at 7.5%) driven by tight control on other expenses (down 180bps QoQ). ASP’s rise (13.8%YoY/9.5% QoQ) to ~Rs 55k/unit continues to reflect strong product mix, higher export and BS-VI led price increases. FY20 is a true reflection of benefits of cost saving initiatives filtering through (EBITDA/vehicle expanded ~13% YoY to Rs4.1k) even as operating leverage remained a headwind (~17% YoY volume drop).
We expect EBITDA/vehicle to hit Rs5.6k in FY22, believe market share gains are likely via scooter revival in urban areas, rebound of moped due to rural improvement. Stock remains attractive at ~17x FY22 standalone EPS. We maintain BUY.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Moneycontrol Ready Reckoner
Now that payment deadlines have been relaxed due to COVID-19, the Moneycontrol Ready Reckoner will help keep your date with insurance premiums, tax-saving investments and EMIs, among others.
First Published on May 29, 2020 05:56 pm