Tata Motors - BUY - TP Rs.514 - Result Update - Kotak

- TAMO reported better than expected results in 2QFY18 driven by improved operational performance in standalone business and at JLR. Consolidated revenue increased by 11% YoY to Rs707bn. EBITDA margin at JLR came at 11.8%, 95bps and 391 bps higher YoY and QoQ respectively. Adjusted consolidated PAT grew by 50% YoY (reported PAT was up by 200% YoY). Going ahead, the company indicated that margin pressure at JLR will continue in 2HFY18. Further JLR volumes in 3QFY18 are expected to stay subdued on account of model run-out (ahead of new launch) and weak demand in certain geographies. However, over the medium to longer term, we expect JLR volume growth to stay healthy. Reduction in hedge losses is expected to support JLR margins in FY19. In the standalone business, the management remains focused on turning around the performance, which in our view will take some more quarters. We retain BUY on the stock with unchanged price target of Rs514

Shares of TATA MOTORS LTD. was last trading in BSE at Rs.408.6 as compared to the previous close of Rs. 414.55. The total number of shares traded during the day was 732963 in over 11028 trades.

The stock hit an intraday high of Rs. 417.55 and intraday low of 407. The net turnover during the day was Rs. 301784423.

Source : Equity Bulls

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