desi auto major Tata Motors reported consolidated net loss of 1,516 crore for the third quarter as compared to 2,906 crore in the same quarter last year. Revenue from operations has declined 72,229 crore from 75,653 crore in the year-ago quarter, however, up 17% from the previous quarter.
Tata Motors said in its earnings statement that the semiconductor shortage is likely to widen till 2022 and will gradually improve with the increase in the supply base.
Analysts at Prabhudas Lilladher maintain their positive stance on Tata Motors as its top stock pick and reiterate, “The PV business is likely to gain further market share, driven by new product launches and portfolio expansion, CV volumes cyclical. Will benefit from the uplift, improved fleet utilisation, and new refreshes in freight rates and Land Rover and a stronger order book to benefit JLR and drive FCF generation.” The brokerage maintains its ‘Buy’ rating on the auto stock with the target price 632 per share.
For the third quarter, JLR revenue came in at £4.7 billion, up 22% on a sequential basis, while EBIT margin was up 1.4%. JLR expects profitability to improve with positive cash flow in the fourth quarter.
“India business will benefit from cyclical revival in the domestic CV industry and market share gains for the PV business. The combination of increasing scale at JLR along with cyclical growth in domestic CVs and continued market-share gains for the PV business will drive significant FCF production. This will make Tata Motors net debt free by FY24E, in our view,” according to Ambit Capital. It has reiterated the buyout on Tata Motors shares with a target price. 619 ( 551 before).
The views and recommendations given above are those of individual analysts or broking companies and not of Mint.
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