TVS Motor Company shares reached a new high of Rs1,187.70, gaining 4 percent on BSE in Tuesday’s intraday trading in anticipation of strong earnings growth driven by a recovery in domestic two-wheeled sales. The shares surpassed their previous high of Rs 1,106.80, which it hit on Friday 14 October.
So far, in October, TVS Motor outperformed the market, rising 8 percent after the company announced that it had a solid start to the holiday season and that demand is expected to increase further over the course of the season. By comparison, the S&P BSE Sensex climbed 2.8 percent in the last 11 trading sessions of the current month.
In September, TVS Motors volumes increased by 9 percent year on year (y / y) to 379,011 units, above analysts’ estimates, thanks to better-than-expected volumes in the domestic market. On the international market front, the company said there has been minimal recovery, but the challenges of the economic slowdown and higher inflation remain. Management is cautiously optimistic that sales dynamics will continue to improve.
Analysts at Emkay Global Financial Services expect TVS Motor to see double-digit volume growth in fiscal 23E and an increase in market share both domestically and internationally.
Despite recent price increases, volume growth expectations remain double-digit for the upcoming Diwali festival. Inquiries and reservations for E-2W are on the rise given central / state government incentives and favorable cost of ownership. Dealers expect major OEMs to dominate EVs given the quality / safety issues startups face, the brokerage firm said in an auto sector update.
TVS Motor has prepared a series of premieres in the 5-25KW categories over the next two years, targeting segments such as premium scooters, high-performance sports motorcycles, access space, delivery market and 3W.
Meanwhile, TVS Motor’s management board is scheduled to meet on November 4 to review and approve the unaudited financial results for the quarter ended September 2022 (Q2FY23).
Prabhudas Lilladher analysts expect a 15% increase in revenues due to a 13% increase in volume. TVS benefits from its premium bike / scooter portfolio. The brokerage house expects the margin to increase by 70 bps q / q. due to the weakening of the price pressure on raw materials.
TVS Motor’s share price has risen 72 percent in the past six months, compared with the 3 percent increase in the S&P BSE Sensex index. It went up 118 percent from the 52-week low price of 513 rupees on March 7, 2022.