Automobiles Q3 Results Preview - Catalysts For Strong Earnings Growth Are Getting Exhausted: ICICI Securities

ICICI Securities Report

We expect automobile space to report Q3 FY24 YoY revenue/Ebitda/profit after tax growth of ~15%/~30%/~30% (excluding Tata Motors Ltd.), with equal contribution of revenue growth and recovery in Ebitdam.

Against ~12% volume growth in original equipment manufacturers, ~8-10% growth in average selling price and Ebitdam improvement, driven by reversion in raw material cost, would be the key triggers for earnings growth.

Growth would likely be more pronounced for auto ancillary players on a YoY basis as they are set to benefit from raw material reversal, strong operating leverage benefit and gradual exports revival.

We expect tyre players to deliver strong YoY earnings growth of ~70% plus. Sequentially, we expect earnings to decline for both OEMs and ancillary players due to seasonality.

Our top picks include: Mahindra and Mahindra Ltd. and Eicher Motors Ltd. in OEMS; CIE Automotive Ltd., Sansera Engineering Ltd. and Craftsman Automation Ltd. in ancillaries.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.