Buy Tata Motors; target of Rs 292: Dolat Capital

Dolat Capital is bullish on Tata Motors and has recommended buy rating on the stock with a target of Rs 292 in its August 9, 2012 research report.

“Tata Motors reported top-line revenue at Rs 433.2bn, up 29% YoY led by 29% YoY volume growth in JLR sales. The company sold 80,277 JLR vehicles during the quarter. The company reported a 4% QoQ increase in blended realisation per vehicle. Domestic revenue was down 9% due to lower volumes impacted by weak macro-economic factors and competitive pressure in passenger vehicle sales.”
“JLR reported operating margins at 14.5%. EBIDTA for the quarter was Rs 62.3bn, up 40% YoY. Consolidated margins stood at 14.4% compared to 14.1% reported in previous quarter. PAT for the quarter stood at 236mn pound. Operating cash flow is GBP 106mn, post capex and product developments spend of GBP 424mn.”
“We continue to remain positive on the stock despite the slowdown in M&HCV and passenger vehicles in India. JLR continues to post strong numbers. Its retail sales for the quarter were higher than wholesale sales. The company has announced plans to increase investment in the Castle Bromwich plant to produce the new Jaguar XF Sportbrake and F-Type. It maintained its guidance of a total capex of 2bn pound. At CMP, valuations look attractive. We continue to recommend buy,” says Dolat Capital research report. Non-Institutions holding more than 90% in Indian cos Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. To read the full report click on the attachment

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