TVS Motor Company, neutral; goal of Rs. 1500: Oswal Motilal
In its research report dated October 31, 2023, Motilal Oswal suggested a Neutral rating with a target price of Rs 1500 on TVS Motor Company.
The TVS Motor Company study report by Motilal Oswal
In 2QFY24, TVS Motor Company (TVSL) reported operational results that were in line, with its highest-ever EBITDA margin of 11% (+40bp QoQ; in line). With operational leverage and decreased marketing costs from new releases in the second quarter, there is still room for improvement in the margin in the next quarters.
Prospects
Nonetheless, we think the current values of 35.7x/30.4x FY24E/FY25E EPS appropriately reflect the significant profits growth led by a rebound in underlying sectors and margin improvement. We keep our FY24E/FY25E EPS unchanged. Stabilize at a TP of around INR 1,500 (based on approximately 22 times December 25 EBITDA + INR 168/sh for NBFC).
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