Shares of Tata Motors: Brokerage rises after Q1 results despite massive losses

Tata Motors’ Q1 EBITDA fell 40% YoY and was 51% lower than Jefferies’ estimate, mainly due to weak JLR results. JLR’s EBITDA margin weak mix due to a sharp decline in 620 bps QoQ on lower volumes and slow ramp-up of the new RR/RR-Sport model.

“India business broadly performed well with CV EBITDA ahead of inline JEFE and PV EBITDA. Tata Motors expects JLR’s performance to improve significantly at the start of 2Q as RR/RR-Sport production ramps up amid a strong order book. We cut FY23 EPS by 24%, but retained buy-on Shares of Tata Motorssaid Jefferies with a target price of 540 on auto stock.

The company’s British arm Jaguar Land Rover (JLR) posted revenue of £4.4 billion in the first quarter, down 7.6 percent from the fourth quarter of FY22, hit by supply challenges including semiconductor shortages.

JLR CEO Thierry Bollore said global semiconductor supplies and the COVID lockdown in China impacted its business performance during the period under review.

Tata Motors expects its British luxury brand Jaguar Land Rover to post a five-quarter high production in the September quarter (Q2FY23), which is more than a disappointing performance in the first quarter of the financial year. Despite concerns over high inflation and geopolitical uncertainties, demand for JLR’s premium and luxury brand cars is expected to remain strong in the UK, Europe and even China.

“We anticipate FY 2012-24 e India CV/PV volumes at a CAGR of 16%/28%, driven by continued growth in industry sales and improved chip supply. The focus is on e-PV, with medium-term investments of US$ 2 billion towards new products, capacity expansion, localization and charging infrastructure,” said brokerage Emkay. The brokerage offered buy with a SOTP-based target price. has confirmed. 530.

The views and recommendations given above are those of individual analysts or broking companies and not of Mint.

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