We attended the 'Tata Motors Investor Day 2021 for India Business', in which Tata Motors' (TML) senior management provided an update on the business environment and future outlook for the two India facing business segments. We came away enthused by the exciting progress that the company has been making in its domestic CV, PV turnaround efforts. TML reiterated its commitment towards near zero automotive net debt level by FY24E and is open to partnership in domestic PV business given segment's capex needs.
Valuation & Outlook
For TML, India business contributed ~18% of FY20 sales (CV 14%, PV 4%). With impending investor day for JLR scheduled on February 26, 2021; our present estimates factor in our positivity on the changing India landscape, and hence we do not alter them. However, given the management intent on FCF generation and profitable growth journey that lies ahead we upgrade our valuation multiples across business segments, retaining our BUY rating on the stock with a revised target price of Rs. 350 (earlier Rs. 301) on SOTP basis (12x, 3.5x FY23E EV/EBITDA for standalone, JLR businesses).
For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_TataMotors_CoUpdate_Feb21.pdf
Shares of TATA MOTORS LTD. was last trading in BSE at Rs.324.1 as compared to the previous close of Rs. 304.15. The total number of shares traded during the day was 6654359 in over 41969 trades.
The stock hit an intraday high of Rs. 328.8 and intraday low of 308. The net turnover during the day was Rs. 2126962389.