TVS Motor :: Results above our estimates on higher margins ::Nomura research

Above or below expectations?
2QFY13 PAT came in at INR452mn which was 8% above consensus
expectations and 26% above our expectations. ASPs were 3% above
our estimates. Margins came in at 6%, while we were expecting 5.4%.

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What does the result mean?
RM/sales declined by 100bps, which was positive.
Likely stock reaction
We don't expect the stock to react significantly on these results as
EBITDA was only 3% ahead of consensus expectations. Further, for
TVS, we expect focus to remain on weak volumes and market share loss
in both the motorcycle and scooter segments.
Our earnings estimates and target price are under review.
Key numbers
 Net sales at INR16.6bn came in above our estimate of INR16bn
 ASPs at INR34,192 came in 3% above our estimates
 EBITDA margins came in at 6%; above our estimate of 5.4%
 RM/sales came in at 73.6% compared to our estimate of 74.6%.
 Employee cost/sales came in at 6.5% compared to our estimate of
6.4%
 Other expenses/sales came in at 15.6% compared to our estimate of
15.3%