TVS Motor Q2 Review – EV, Exports Story Unfolding: IDBI Capital

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TVS Motor Co.’s Q2 FY22 profit increased by 41.5% YoY to Rs 2.8 billion which is in line with our estimates.

The company reported double digit Ebitda margin twice in last three quarters which is quite commendable. Management commentary about growth prospects in the domestic two-wheeler market was encouraging. However, aggressive plans in the electric vehicle segment with new launches and new initiatives in export markets were impressive.

To factor in current slackness in the business environment, we have reduced our volume and profit after tax estimates by 0.9% and 6.8% for FY23.

We believe, TVS Motor is likely to grow ahead of industry in its domestic and its international business based on the strength and popularity of its four marque brands (Jupiter, Ntorq, Apache and Radeon).

We rate the stock as ‘Buy’ with revised price target of Rs 674.

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