Tata Motors (CMP Rs315, BUY) - JLR launches & domestic economy to drive growth - BRICS Research

Tata Motors' Q4FY13 numbers (consolidated) were better than our expectations, with revenue and PAT coming in 12% and 26% above our estimates. Consolidated revenue grew 10% yoy to Rs560bn, driven by increase of 26% yoy in JLR revenue, while standalone revenue fell 33% yoy. Consolidated reported EBITDA stood at Rs83bn, up 16% yoy and 20% above our estimate, resulting in consolidated EBITDA margin of 14.9%, up 77bps yoy. JLR led the margin improvement with reported margin of 16.9%, while standalone margin came in at 3.6%. We expect new launches and growth from US & emerging markets to support Tata Motors' volume growth. We raise our volume and earnings estimates by 4% and 3% for FY14 and by 6% and 7% for FY15 respectively. We expect JLR's performance to continue driving Tata Motors' earnings. We raise our TP to Rs356 (Rs305 earlier). Upgrade to Buy.

Source : Equity Bulls

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