Buy TVS Motors; target of Rs 615: Sharekhan

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26 Aug, 2025 12:21

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Sharekhan's research report on TVS Motors

TVS Motor (TVSM) reported an impressive operating performance for Q2FY2019 with numbers coming in ahead of ours as well as street estimates. Revenue at Rs. 4,993 crore grew by 23% on account of strong 15% volume growth. Good response for the new launches in the recent past and improved demand in the exports market, drove sales growth. Realisation per vehicle grew by 7% on account of a favourable product mix and price hikes taken by the company. Operating margin at 8.6% came in as a positive surprise with a 90 BPS sequential expansion. Margin came in ahead of our expectations of 7%. Operating leverage and better pricing power led to better- than-anticipated margin. Other income declined steeply by 98% y-o-y, following a change in accounting policies, which necessitates interest income on advance from dealers and customers to be booked an operational income. Net profit at Rs. 211 crore came in flat on a y-o-y basis, ahead of our estimates of Rs. 184 crore.

Outlook

We retain our Buy rating on the stock with a revised PT of Rs. 615 (earlier PT of Rs. 670).

For all recommendations report, click here

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