Sharekhan's research report on Tata Motors
Tata Motors Limited (TAMO) to benefit from the CV upcycle and renewed focus on the PV segment in the domestic business, while easing of chips shortage to benefit JLR’s performance. TAMO’s aggressive plans of launching 10 EV products in India by 2026; likely to maintain its dominancy in the fastest growing EV segment. TAMO to become earnings positive in FY2022E with 64.8% y-o-y PAT growth in FY2023E, driven by a 16.7% revenue CAGR during FY2021E-FY2023E and a 120-bps improvement in EBITDA margin to 13.4% in FY2023E from 12.2% in FY2021.
We maintain Buy on TAMO with an unchanged PT of Rs. 610, driven by overall improvement in its operational performance. The stock trades at P/E multiple of 17.1x and EV/EBITDA multiple of 5.2x its FY2023E estimates.
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