Strong show at both domestic & JLR businesses
Tata Motors (TAMO) is India’s largest CV manufacturer with 55% market share in M&HCV segment. Besides, it also manufactures passenger cars and utility vehicles. With the acquisition of Jaguar Land Rover (JLR) from Ford in 2008, TAMO now has presence in the global luxury car market. Importantly, TAMO derives about 80% of its revenue from JLR.
Outlook and Valuation: We are positive on the stock given a strong product pipeline at JLR & company’s intent to plug the gaps in its domestic portfolio and presence of margin levers. Hence, we expect revenue/Adj. PAT CAGR of 10%/82% over FY17-20E. Hence, we retain ‘BUY’ rating on the stock with a target price (TP) of Rs. 480 based on SOTP.
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