The brokerage has a âbuyâ call on the stock with a price target of Rs 430. Sharekhan sees an overall improvement in the business of Tata Motors and expects earnings to turn positive over the course of the year. ‘Fiscal 2022 and increase 69.1% in FY 2023E, driven by a% CAGR of revenue in FY 2021-FY 2023E and a 130 basis point improvement in margin ‘EBITDA.
âRetail sales and orders remain strong, which should keep wholesale sales strong as the semiconductor chip shortage problem is expected to improve from the third quarter of fiscal 22. management remains positive on product delivery, launches and investment programs as previously planned. with the global chip shortage, chip manufacturing facilities in Japan and Texas will be slow to recover, âthe brokerage said.
Tata Motors: growth engines intact
According to Sharekhan, the main growth drivers for the company are intact. When it comes to the global chip shortage, chip manufacturing facilities in Japan and Texas will be slow to pick up. âWith electrification being the next motivation for the company over the next decade, JLR is aiming for net zero carbon emissions by 2039. Management has maintained its positive outlook for its JLR business, expecting a flow of positive cash flow by FY23, net debt to zero by FY24, and EBIT margins above 10% by FY26, “the brokerage said.
Tata Motors: attractive on valuations
“We expect Tata Motors’ earnings to turn positive in fiscal 2022E and 69.1% in fiscal 2023E, driven by a 16.7% CAGR of revenues in fiscal 2021 to 2023E and a 130bp improvement in the EBITDA margin. Our SOTP-based assessment calls for a target of Rs 430 for Tata Motors. The stock is trading at attractive valuations at a P / E multiple of 9.6x and an EV / EBITDA multiple of 2.9x its estimate for FY 2023E. We maintain a buy on the stock with an unchanged target price of Rs 430, âsaid the brokerage firm.
Shares of Tata Motors were last seen at Rs 306 on the NSE.
Tata Consulting Services (TCS)
Sharekhan has also issued a call to buy TCS shares. The company recently reported its quarterly figures. The brokerage maintained a call to buy on the stock with an unchanged target of Rs. 3,750, given strong potential for revenue growth, resilient margin performance and strong business skills. technologies and fields.
âManagement remains confident in the publication of sustainable margins in fiscal 2022E, aided by strong revenue growth and operational efficiencies, despite an increase in discretionary spending. It is well positioned to seize opportunities for growth and transformation. % CAGR relative to FY2021-23E; we continue to favor TCS because of its full-service business model, better execution, consistent mega-deals and higher payouts, âthe brokerage said.
TCS shares were last seen at Rs 3,208 on the NSE.
All of the above actions are taken from brokerage reports. Investing in stocks is risky and investors should do their own research. The author, brokerage firm or Greynium Information Technologies Pvt Ltd is not responsible for any losses incurred due to a decision based on the above article. Investors should therefore be cautious as the markets have risen significantly.