TVS Motor Q1 Results Review - Inline, Ebitda Margin Continues To Improve: Motilal Oswal

Motilal Oswal Report

TVS Motor Company Ltd,. posted an in-line performance, achieving yet another quarter of Ebitda margin improvement due to material cost savings and a better mix. While the domestic demand outlook is healthy with rural demand coming back, geopolitical uncertainties in key export markets may dent the overall growth.

Moreover, we believe strong earnings growth driven by recovery in the underlying segments and margin improvement is fairly captured in the current valuations of ~44 times/36 times FY25E/FY26E earnings per share.

We raise our FY25E/26E EPS by ~3%/7% to factor in better margins and higher other income. Reiterate Neutral with a target price of ~Rs 2,265 (based on ~28 times June-26E EPS and Rs 201/share for NBFC).

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