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Tata Motors shares rise for 4th day, ahead of Q3 results.

Tata Motors shares rise for 4th day, ahead of Q3 results.

Tata Motors’ domestic commercial vehicle segment may see 50 basis points margin improvement on sequential basis, HDFC Institutional Equities said.

Tata Motors stock rose 1.16 per cent to hit a high of Rs 427 on BSE, taking its year-to-date gain to 7 per cent. Tata Motors stock rose 1.16 per cent to hit a high of Rs 427 on BSE, taking its year-to-date gain to 7 per cent.

Shares of Tata Motors on Wednesday advanced for the fourth straight day ahead of its December quarter results. The stock rose 1.16 per cent to hit a high of Rs 427 on BSE, taking its year-to-date gain to 7 per cent. Analysts are largely expecting the Tata group firm to report 15 per cent rise in consolidated sales while some also expects the automaker to report consolidated profit for the quarter. Analysts said margin for the quarter may fall on year-on-year basis, but an improvement is likely on a quarter-on-quarter (QoQ) basis.

Emkay Global said Tata Motors may log a 15 per cent growth in consolidated revenues, driven by growth across divisions. Consolidated Ebitda margin should contract 50 bps YoY, owing to lower margin in JLR, it said. Sequentially, Ebitda margin is expected to expand 113 basis points, it said.

HDFC Institutional Equities said Tata Motors may clock a consolidated revenue of Rs 84,202 crore, up 16.6 per cent YoY and 5.8 per cent sequentially. This brokerage sees consolidated profit for the Tata group firm at Rs 26.70 crore. It sees margin for the quarter at 12 per cent.

The domestic commercial vehicle segment may see 50 basis points margin  improvement on sequential basis, the brokerage said. Volumes at Jaguar Land Rover improved 5.7 per cent sequentially to 79,600 units due to continued supply constraints and Covid impact in China, HDFC Institutional Equities noted.

"However, the JLR mix is favourable as sales of higher end RR-RR Sport have doubled QoQ. Overall, we expect JLR’s margin to improve 130 bps QoQ to 11.6 oer cent, led by an improved mix," HDFC Institutional Equities said.

Emkay Global expects JLR’s sakes to rise 19 oer cent YoY to 5.6 billion British pound. This, it said, would be led by higher volumes (up 14 per cent) and realisations (up 5 per cent). Ebitda  margin is seen contracting 120 bps amid adverse model mix. India commercial vehicle segment sales are seen growing 20 per cent to Rs 14,900 crore, led by higher realisation (up 26 per cent).

"Realisation may improve due to higher MHCV share– 42 per cent vs 34 per cent YoY and price hikes. Ebitda margin may expand 340 bps to 5.8 per cent due to better net pricing and scale," Emkay Global said.

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Published on: Jan 25, 2023, 10:21 AM IST
Posted by: Tarab Zaidi, Jan 25, 2023, 10:00 AM IST