Angel Broking neutral on Tata Motors
Brokerage house Angel Broking has maintained a 'Neutral' rating on Tata Motors in its October 15, 2013 research report.
October 16, 2013 / 18:40 IST
Angel Broking's report on Tata Motors
Jaguar and Land Rover (JLR) continued its strong momentum in September 2013 with wholesale sales witnessing a growth of 35.6 percent yoy (16.1 percent mom) to 35,874 units. The growth was led by a strong performance across Jaguar and Land Rover models, on the back of success of new launches, easing of capacity constraints and strong growth traction in China.Jaguar sustained its impressive run, posting a growth of 129.3 percent yoy (23.3 percent mom) to 6,438 units driven by incremental volumes for the F-type and growth in the XF model led by the introduction of the Sportbrake, AWD and smaller engine variants.Land Rover sales too recorded a robust growth of 24.4 percent yoy to 29,436 units led by dispatches of the new Range Rover and new Range Rover Sport and strong growth in Range Rover Evoque.Global luxury car manufacturers too posted a healthy performance with Audi and Mercedes recording highest ever monthly sales driven by strong volume traction in China.Audi registered a strong growth of 10 percent yoy driven by a strong performance of the A3 family and Q3 and Q5 SUV models. The company continues to benefit from healthy growth in the US (up 6.2 percent yoy) and robust growth in China (up 28.2 percent yoy). Sales in Europe too grew by 3 percent yoy during the month.BMW recorded a healthy growth of 7.6 percent yoy primarily driven by the 3 series which clocked a growth of 13.9 percent yoy. Geographically, Asia grew by 18 percent yoy with the China region witnessing a robust growth of 20.8 percent yoy during the month.Mercedes-Benz too registered a robust growth of 15.9 percent yoy driven by the success of its new models including the E and S Class and compact models. Geographically, Asia Pacific and the Europe region recorded a strong growth of 26.2 percent and 14.2 percent yoy respectively.Outlook and valuation: "Going ahead, we expect headwinds in the standalone business to continue in FY2014 due to weak macro-economic environment which is expected to continue impacting domestic volumes. However, we expect JLR to sustain its strong performance driven by continued momentum in the global luxury vehicle market and aided further by the strong product launch pipeline and the success of the models launched in 4QFY2013. We expect JLR volumes to grow at ~13 percent CAGR during FY2013-15E and PAT to grow at ~25 percent CAGR during the same period. While we retain our positive view on Tata Motors, post the sharp ~20 percent surge in the stock price over the last one month, the upside remains limited. We therefore maintain our Neutral rating on the stock," says Angel Broking research report.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. 
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