The ‘Jupiter’ scooter maker’s profit rose 23.5% to Rs 663 crore in the quarter ended September 2024, which missed analysts’ estimate of Rs 697 crore.
During the quarter, it incurred a Rs 28.9 crore expense due to changes in inventories, compared to an income of Rs 261 crore a year ago. This pushed its total expenses up nearly 12%, with the cost of materials consumed increasing 4.3% in the quarter.
After the company’s Q2 results, here is what analysts across various brokerage firms say:
Investec on TVS Motor: Buy | Target price: Rs 3,050
Investec has maintained a Buy rating on the stock while hiking the target price to
Rs 3,050 from Rs 3,035. Q2 was an operational miss driven by revenues. However, festive demand is likely to drive growth momentum. EV ramp-up is on track and Investec expects an EPS CAGR of 20% over FY24- 27 led by multiple reasons.Also read: HUL shares tumble nearly 5% as Q2 results disappoint. Should you buy, sell or hold?
Motilal Oswal: Neutral | Target price: Rs 2,610
Motilal Oswal maintained a neutral rating on TVS Motor with a target price of Rs 2,610.
The recently launched Jupiter 110 has been very well received by customers and is likely to help TVS gain share in scooters in the coming quarters. However, in motorcycles, for the first time in many years, TVS has underperformed the industry in H1. More importantly, TVS has underperformed in the 125cc segment, which has been its key growth driver in recent years. Further, the export outlook, especially in Africa, remains weak.
ICICI Securities: Hold | Target price: Rs 2,596
ICICI Securities has downgraded the stock to a hold rating from the previous add with a target price of Rs 2,596.
TVS Motor Company continued to move up the profitability curve. The company delivered yet another quarter of record margin at 11.7% (vs. consensus 11.8%), up 65bps/25bps YoY/QoQ despite the EV mix increasing 70bps/130bps in Q2FY25. TVS expects rural demand to recover, and it expects to see 7–8% industry growth in Q3.
ICICI Securities believes that TVS has the capability to deliver 12–12.5% EBITDAM in FY25–26E, despite e2W scaling in excess of 30k units/month with 10% CAGR in overall volume in FY24–26E. However, the stock (up 70%) has outperformed the Nifty index (up 27%) over the last one year, reducing its upside.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)