Tata Motors
BSE SENSEX
34,433
S&P CNX
10,632
10 January 2018
Update
| Sector:
Automobiles
CMP: INR433
TP: INR593 (+37%)
Buy
JLR’s December 2017 wholesale volumes in-line at 55k units
Stock Info
Bloomberg
Equity Shares (m)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
M.Cap. (INR b)
M.Cap. (USD b)
Avg Val, INRm
Free float (%)
Land Rover volumes up 2.8% YoY; Jaguar volumes increase 6% YoY
TTMT IN
3,395.9
553 / 358
2/-13/-44
1613.2
25.0
3556
63.6
Financials Snapshot (INR b)
Y/E March
2018E 2019E 2020E
Net Sales
2,929 3,548 3,800
EBITDA
384
561
601
NP
111
206
225
Adj. EPS (INR)
32.8
60.7
66.3
EPS Gr. (%)
65.5
85.2
9.2
BV/Sh. (INR)
214
276
344
RoE (%)
17.0
24.8
21.4
RoCE (%)
9.6
15.2
13.9
P/E (x)
13.3
7.2
6.6
P/BV (x)
2.0
1.6
1.3
Shareholding pattern (%)
Sep-17 Jun-17 Sep-16
As On
Promoter
36.4
34.7
33.0
DII
15.3
16.1
14.5
FII
22.6
23.5
26.1
Others
25.8
25.7
26.4
FII Includes depository receipts
Stock Performance (1-year)
Tata Motors
Sensex - Rebased
700
JLR’s wholesale volumes grew 3.8% YoY and 1.5% MoM in December 2017 to
55,066 units (including China JV’s 10,269 units). Jaguar volumes grew 6% YoY to
16,826 units against our estimate of 12,000 units due to lower XE sales. Land
Rover (LR) volumes increased 2.8% YoY to 38,240 units against our estimate of
54,750 units, led by ramp-up of all-new Discovery and RR Velar.
For 3QFY18, JLR wholesales grew 4.5% YoY to 159,067 units, led by 12.4% YoY
growth in Land Rover sales while Jaguar sales fell 12.5% YoY to 42.4k units.
JLR’s retail volumes increased marginally by 0.6% YoY and 6.4% MoM to 55,697
units. The 4.1% YoY increase in LR volumes was partially offset by 7.8% YoY
decline in Jaguar volumes.
XF volumes grew 6.1% YoY. Jaguar XE volumes declined 35% YoY. F-Pace
volumes remained flat YoY. Company started retails of E-Pace, with 454 units.
LR’s retail volumes increased by 4.1% YoY, mainly led by 71.1% rise in Discovery
volumes, while RR Sport and RR Evoque volumes declined 37.5% and 12.5%,
respectively. RR Velar clocked in 6,521 units.
Region-wise, China reported strong volumes at 15,603k units (including China
JV’s 8,556 units), up 12.6% YoY. The growth in China is reflecting the
introduction of the long wheelbase Jaguar XFL as well as strong sales of F-Pace,
Discovery Sport, Range Rover Sport and Evoque. While retail sales were down
in Europe (-4.6%), US (-9.2%) and UK (-15.8%), other markets witnessed volume
growth of 19%.
Mr Joe Eberhardt, President and CEO, Jaguar Land Rover North America, LLC
said, “Jaguar Land Rover in the US achieved another record year for 2017, as
our newest models broadened the appeal of both of our great brands.”
The stock trades at 7.2x/6.6x FY19E/FY20E consolidated EPS. Maintain
Buy
with a target price of INR593 (December 2019E SOTP-based) for ordinary
shares and INR414 for DVR (~30% discount to TP for ordinary shares).
600
500
400
300
Jinesh Gandhi – Research Analyst
(Jinesh@MotilalOswal.com); +91 22 3982 5416
Research Analyst:
Deep Shah
(deep.shah@MotilalOswal.com); 6129 1533 |
Suneeta Kamath
(suneeta.kamath@MotilalOswal.com); 6129 1534
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.