Emkay Global Financial Services is bullish on Tata Motors and has recommended buy rating on the stock with a target price of Rs 1,230 in its August 12, 2011 research report.
Emkay Global Financial Services is bullish on Tata Motors and has recommended buy rating on the stock with a target price of Rs 1,230 in its August 12, 2011 research report.
“Tata Motors, EBIDTA/APAT at Rs 42.3bn/21.7bn were ~7%/4% above est. driven by JLR. JLR reports FCF of GBP 117mn despite capex/R&D of GBP 400mn. Net D/E was 0.18x (Mar11 - 0.24x). Standalone business continues to disappoint. Company is facing cost/demand pressure across business segments. Volume outlook remains strong for JLR with launch of Evoque, new XF (2.2 ltr diesel) and also XF 2012. Lower FY12/FY13 EPS estimates by 11%/9% to Rs 138/155 to factor in deteriorating macro environment (lower valuation multiple).”
“Net sales at GBP 2.7bn was marginally higher than our est. of GBP 2.6bn led by improved realizations. Average selling price at GBP 43,682 increased ~14% YoY, ~5.6% QoQ driven by favorable geography mix (higher China sales) and lower discounts. Product mix continues to remain in favour of LR due to inventory clearance of Jaguar in US/UK in the run to the introduction of 2012 XF. Also company will be introducing a smaller XF (2.2 tlr diesel) in 2H. At CMP of Rs 846, the stock trades at PER of 6.1x/5.5x and EV/EBIDTA of 4.2x/3.7x our FY12 and FY13 estimates respectively. We are enthused by FCF generation at JLR despite a GBP 400mn capex. Similarly, there is a sequential reduction in net debt. We retain our BUY rating with a revised target price of Rs 1,230. We have lowered our target multiple for JLR from 4x to 3.5x to factor in the deteriorating macro environment,” says Emkay Global Financial Services research report.
Emkay Global Financial Services is bullish on Tata Motors and has recommended buy rating on the stock with a target price of Rs 1,230 in its August 12, 2011 research report.
“Tata Motors, EBIDTA/APAT at Rs 42.3bn/21.7bn were ~7%/4% above est. driven by JLR. JLR reports FCF of GBP 117mn despite capex/R&D of GBP 400mn. Net D/E was 0.18x (Mar11 - 0.24x). Standalone business continues to disappoint. Company is facing cost/demand pressure across business segments. Volume outlook remains strong for JLR with launch of Evoque, new XF (2.2 ltr diesel) and also XF 2012. Lower FY12/FY13 EPS estimates by 11%/9% to Rs 138/155 to factor in deteriorating macro environment (lower valuation multiple).”
“Net sales at GBP 2.7bn was marginally higher than our est. of GBP 2.6bn led by improved realizations. Average selling price at GBP 43,682 increased ~14% YoY, ~5.6% QoQ driven by favorable geography mix (higher China sales) and lower discounts. Product mix continues to remain in favour of LR due to inventory clearance of Jaguar in US/UK in the run to the introduction of 2012 XF. Also company will be introducing a smaller XF (2.2 tlr diesel) in 2H. At CMP of Rs 846, the stock trades at PER of 6.1x/5.5x and EV/EBIDTA of 4.2x/3.7x our FY12 and FY13 estimates respectively. We are enthused by FCF generation at JLR despite a GBP 400mn capex. Similarly, there is a sequential reduction in net debt. We retain our BUY rating with a revised target price of Rs 1,230. We have lowered our target multiple for JLR from 4x to 3.5x to factor in the deteriorating macro environment,” says Emkay Global Financial Services research report.