Tata Motors Ltd. Its JLR again!, Retain BUY : :Emkay

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Tata Motors Ltd.

Its JLR again!, Retain BUY

BUY

CMP: Rs 178                                       Target Price: Rs 220

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n     EBIDTA/APAT at Rs 45bn/22.4bn was ~6%/5% above est. driven by JLR.  JLR reports adj. margins of 15.9% (QoQ up 90 bps) despite adverse product mix and currency

n     Standalone business continues to disappoint. Margins nosedives to 6.7% due to weakening PV franchise. Other subsidiaries reports a jump in EBIDTA

n     Factoring in margin pressure across business segment. However, JLR can surprise positively on margins. Factoring 150 bps drop in JLR margins for 2HFY12 vs 2QFY12

n     Fine tune our conso. FY12/13 EPS to Rs 27.3/29.9. However, lower standalone EPS by 27% to Rs 3.7/4.6. Upside risk arise from volumes/margin surprise at JLR