Edelweiss recommended hold rating on Tata Motors with a target price of Rs 501 in its research report dated February 14, 2017.
Edelweiss' research report on Tata Motors
We have lowered FY17/18E EBIDTA by 35%/25% to INR295bn/385bn to reflect weaker margins. We introduce FY19E with EBIDTA of INR 428bn. We estimate 8% EPS CAGR over FY16-19 to INR48. Valuing JLR at 5.5x FY19E EV/EBIT and standalone at 8x FY19E EV/EBIDTA, we downgrade to ‘HOLD/SP’ from ‘BUY/SO with TP of INR 501. At CMP, the stock trades at PER of 14x/10x FY18E/FY19E EPS.
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