The share price of TVS Motor Company jumped over 10 percent to a 52-week high of Rs 586.40 apiece in early trade on Friday after the company reported a strong set of earnings for the December quarter, beating Street estimates.
TVS Motors’ standalone net profit in Q3FY21 doubled to Rs 265.6 crore from Rs 121.1 crore in the year-ago period. Net profit of the company beat CNBC-TV18 analysts’ poll estimates of Rs 231 crore.
Total revenue from operations increased 30.7 percent to Rs 5,391.4 crore from Rs 4,125.5 crore, YoY.
“During the quarter ended December 2020, the overall two-wheeler sales of the Company including exports grew by 23% to 9.52 Lakh units from 7.73 Lakh units in the quarter ended December 2019,” TVS Motor Company said in a regulatory filing.
Motorcycle sales grew by 31 percent to 4.26 lakh units in the quarter ended December 2020 from 3.25 lakh units registered in the quarter ended December 2019. Scooter sales of the company grew by 11 percent to 3.11 lakh units in the quarter ended December 2020 from 2.80 lakh units in the quarter ended December 2019.
Total three-wheelers registered sales of 0.38 lakh units in the quarter ended December 2020 as against sales of 0.48 Lakh units in the quarter ended December 2019.
The two and three-wheeler manufacturer’s EBITDA rose 40.7 percent to Rs 511.2 crore from Rs 363.2 crore, while EBITDA margin expanded by 70 bps to 9.5 percent from 8.8 percent, YoY.
During the nine months period, focused working capital management and improved operating performance helped the company generate free cash flow of Rs 1,616 crore.
These proceeds are used to reduce the debt. Lean stocks with the dealers also helped to unleash the blocked working capital across the supply chain, the company said.
Brokerage firm CLSA said that TVS Motor’s 3QFY21 results came in better than its and consensus expectations.
It noted that while commodities continue to inch upwards, the company continues to take price hikes, and it is also working on cost savings to protect its margin.
CLSA increased its FY21-23 EPS 15 percent-19 percent, raised its target price to Rs 600 per share from Rs 525 earlier and maintained an 'Outperform' rating on the stock.
At 10 am, the shares of TVS Motor Company were trading 9.65 percent higher at Rs 579.65 apiece on the BSE as compared to a 0.07 percent gain on the benchmark Sensex.
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