Hold TVS Motor; target of Rs 565: JM Financial

JM Financial recommended hold rating on TVS Motor with a target price of Rs 565 in its research report dated October 23, 2018.

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October 25, 2018 / 12:27 IST

26 Aug, 2025 12:21

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JM Financial's research report on TVS Motor

In 2QFY19, TVS Motor (TVS) reported EBITDA margin of 8.6% (-35bps YoY, +90bps QoQ), surpassing JMFe and street expectations owing to higher volumes, price increase and a favourable exchange rate. Without sharing a number, the management indicated ‘moderate’ growth during the Navratri period (including Dusshera), impacted by the increase/confusion on insurance premium. However, the Company expects strong pick-up in sales during the traditionally robust phase of ‘Dhanteras’ and ‘Diwali’, driven by positive response to new models. With increase in fuel price, hike in insurance premium and heightened competitive intensity, we remain cautious on the 2W segment in the near-term. Festive demand in the remaining period and monthly wholesale volumes would be the key monitorables.

Outlook

Maintain HOLD with a revised TP of INR 565 (roll-forward to Sept ’19). Higher than expected market share gain and margin expansion are key risks to our call.

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