Buy TVS Motor Company, target price Rs 610: Geojit

Geojit has buy call on TVS Motor Company with a target price of Rs 610. The current market price of TVS Motor Company Ltd. is Rs 526.

Time period given by analyst is one year when TVS Motor Company Ltd. price can reach defined target. TVS Motor Company Ltd., incorporated in the year 1992, is a Large Cap company (having a market cap of Rs 25063.22 Crore) operating in Auto sector.

Financials
For the quarter ended 30-06-2021, the company reported a Consolidated Total Income of Rs 4692.03 Crore, down -23.59 % from last quarter Total Income of Rs 6140.54 Crore and up 141.07 % from last year same quarter Total Income of Rs 1946.35 Crore. Company reported net profit after tax of Rs -15.18 Crore in latest quarter.


Investment Rationale
Amid Cautious outlook, sustainability of the margin is possible, with respect to superior product mix and product innovation. However, higher raw material price and competition from peers to put pressure on the margin for near term. The brokerage values TVSM's standalone business at 22x FY23E EPS (Rs.572/share) and TVS Credit Services at 1x trailing BV (Rs.38/share) to arrive at a target price of Rs.610/share and recommend buy rating at CMP.

Promoter/FII Holdings
Promoters held 52.3 per cent stake in the company as of June 30, 2021, while FIIs held 14 per cent, DIIs 24.3 per cent and public and others 9.5 per cent.