Auto major Tata Motors is expected to announce its March quarter results today, May 18. Brokerages forecast a fivefold rise in earnings before interest, taxes, depreciation, and amortization (EBITDA) on the back of a 40 percent year-on-year (YoY) growth in revenue.
The company had reported a 90 percent rise in standalone volumes (India) to 1.91 lakh units for Q4 FY21 driven by strong passenger vehicle demand and recovery in commercial vehicle demand. Its subsidiary, the UK-based luxury carmaker Jaguar Land Rover, is expected to report a 2 percent YoY decline in volume (excluding China JV), but a 7-8 percent YoY increase (including China JV).
"During the quarter, the commercial vehicle segment has witnessed growth on the back of improved consumer sentiments, stable freight rates, and higher infrastructure demand. The passenger vehicle business witnessed strong growth on a low base with robust demand for personal mobility and new launches. The electric vehicle segment witnessed 3x growth on a YoY basis," said KR Choksey.
Meanwhile, Sharekhan expects consolidated revenue to grow by 41.3 percent and consolidated PAT to jump to Rs 2,825 crore in Q4 FY21.
"Tata Motors standalone volumes grew around 94 percent YoY while JLR volumes (including JV) are expected to grow around 8 percent YoY. This coupled with expected realisation growth of 3 percent and 29 percent for standalone and JLR will result in consolidated revenue of Rs 95,366.8 crore (up 53 percent YoY)," said Prabhudas Lilladher.
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Kotak Institutional Equities expects JLR volumes to increase by 7 percent YoY (including China JV) and down 2 percent YoY (excluding China JV) in Q4 FY21. The brokerage further expects revenues (ex-China JV) to increase by 23 percent YoY led by 2 percent YoY decline in volumes and a 25 percent YoY increase in the average selling price in Q4FY21 due to a positive geographical mix.
At the operating level, consolidated EBITDA margin is expected grow around 1,000 bps YoY driven by continued cost-saving at JLR. The improvement in standalone business margin due to increased volume especially in the passenger vehicle segment could also support margin.
So far in 2021, Tata Motors' share price has surged 75 percent. In the preceding 12-month period, the stock has delivered a whopping 298 percent to its investors.Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.