Motilal Oswal: TVS Motor’s Q1 Above Estimate, Lower Other Expenses Drive Beat
TVS Motor Company employees work on the vehicle production line at the PT TVS Motor Company Indonesia Factory in Karawang (Photographer Dimas Ardian/Bloomberg)

Motilal Oswal: TVS Motor’s Q1 Above Estimate, Lower Other Expenses Drive Beat

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Motilal Oswal Report

TVS Motor Co. Ltd.’s operating performance was supported by lower other expenses. It expects cost-cutting efforts to boost margins, with volume recovery and the Premium portfolio outperforming.

Q1 FY21 revenue declined 68% to approximately Rs 14.3 billion, and reported Ebitda / adjusted loss of approximately Rs 0.5 billion/Rs 1.4 billion.

Volumes fell by approximately 71% YoY (-58% QoQ). Realizations grew approximately 10.8% YoY (-2.5% QoQ) to Rs 53,600 (versus estimate Rs 56,200), driven by the Bharat Stage VI (BS6) cost pass-through.

Gross margins contracted 90 basis point QoQ (70 basis point YoY) to 24.1% (estimate 25.6%), weighed by a weaker product mix (lower export mix and Apache) and the impact of the BS6 cost inflation (as contribution margins are yet to be passed through).

Click on the attachment to read the full report:

Motilal Oswal TVS Motor Company Q1FY21 Result Update.pdf

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