Q3FY21 Result Update - Tata Motors - ICICI Direct

Tata Motors (TML) reported stellar Q3FY21 results. Consolidated sales rose 5.5% YoY to Rs. 75,654 crore (JLR sales down 6.5%, India sales up ~35%). Consolidated margins were at near six year high of 16.9% (JLR 15.8%, India 7.4%) on the back of sharp ~500 bps savings in other expenses on percentage of sales basis and softer than expected gross margin contraction. Consolidated PAT was at Rs. 2,941 crore. Tata Sons holding, post conversion of warrants as of January 2021, was at 45.8%.

Valuation & Outlook

For TML we factor in 19% sales CAGR in FY21E-23E, with FY23E profit of Rs. 8,323 crore. We remain enthused by TML's deleveraging intent and upbeat margin and cash flow guidance at JLR. We maintain BUY, valuing TML at Rs. 301 on SOTP basis (10x, 3.25x FY23E EV/EBITDA to standalone business & JLR respectively; earlier target Rs. 210).

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_TataMotors_Q3FY21.pdf

Shares of TATA MOTORS LTD. was last trading in BSE at Rs.262.6 as compared to the previous close of Rs. 266.85. The total number of shares traded during the day was 10077046 in over 68317 trades.

The stock hit an intraday high of Rs. 278.85 and intraday low of 260.6. The net turnover during the day was Rs. 2729493914.

Source : Equity Bulls

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