TVS Motor Shares Surge 5% After Net Profit Jumps 46% In Q1

TVS Motor shares rallied over 5 per cent and traded at Rs 1,379 on 25 July, with eight lakh shares changing hands on the National Stock Exchange (NSE). The two-wheeler company reported a 46 per cent growth in net profit to Rs 468 crore for the April-June quarter of fiscal 2024.

The company recorded a 20 per cent increase in revenue to Rs 7,218 crore, compared to Rs 6,009 crore in the corresponding quarter last year.

During the April-June quarter, the Chennai-based company reported its highest ever operating EBITDA (earnings before interest, taxes, depreciation, and amortization) of Rs 764 crore, up 27 per cent from Rs 599 crore last year.

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The EBITDA margins improved by 60 basis points (bps) to 10.6 per cent in the year-ago quarter.

TVS Motor recorded its highest-ever profit before tax (PAT) of Rs 610 crore, a growth of 41 per cent over Rs 432 crore in the last fiscal year.

The company’s earnings numbers were in line with analyst estimates.

TVS informed us that sales of its electric scooters for the reported quarter stood at 39,000 units, a massive jump from 9,000 units sold in the June quarter of fiscal 2023.

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Overall two-and three-wheeler sales, including exports, increased 5 per cent to 9.53 lakh units in the quarter ended June, compared with 9.07 lakh units in the last year period.

At 1:30 PM, the stock was trading 5.19 per cent higher at Rs 1,374.35 on the BSE. On a year-to-date basis, the stock has rallied 28 per cent, while it has surged 57 per cent in the last year.

HDFC Securities maintained its ‘Buy’ rating on TVS Motor stock with a revised target price of Rs 1,459 from Rs 1,342 earlier. "TVS Motors’ Q1 PAT came in ahead of estimates due to higher other income, although its margins came in line with our estimate at 10.6%. This performance is commendable, given that it includes the 30bps impact of price protection for eligible iQube customers and the ramp-up of iQube volumes," the brokerage firm said.

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Motilal Oswal reiterated a ‘Neutral’ rating, Nuvama retained its ‘Buy’ rating, and Nirmal Bang has an ‘Accumulate’ rating on TVS Motor Company.