TVS drives to five-day winning streak as UBS raises price target
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On October 11, domestic brokerage house, DAM Capital raised the target price to Rs 3,051, implying an upside of 62 percent, from Rs 1,875.
Shares of TVS Motor Company Limited gained over 1 percent higher to Rs 1,567 in early trade on October 12 after global brokerage firm UBS raised the target price suggesting that electric vehicles and improving exports bode well for the company.
The analysts have raised the target price to Rs 1,850, implying an upside potential of about 19 percent from the previous closing price of Rs 1,550. The earlier target price was Rs 1,570. Furthermore, the broking company has a ‘buy’ call on the two-wheeler automobile major.
Shares of TVS have been on a stellar run, ending in green for five days in a row, and gaining over 4 percent on the bourses.
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As for strides in the electric vehicle (EV) space, UBS is of the view that the TVS is continuously widening its lead over peers. In the EV segment, TVS only trails OLA in terms of market share.
According to data from the Society of Manufactures of Electric Vehicles (SMEV), the company’s market share has improved to about 20 percent, and it sold over 15,000 units in September.
Additionally, UBS, in its note, said that the in-sourcing of EV tech lends a significant edge for the company.
Not only is the company launching new models, but UBS also says that new additions to the portfolio have industry-first features. “Recently unveiled ICE motorcycle Apache RTR 310 boasts some exclusive features which one won’t find in any other motorcycle”.
On exports, UBS forecast that exports shall recover faster than that of Bajaj exports. It has raised the target multiple for core business to 17 times EV/EBITDA.
On October 11, domestic brokerage house, DAM Capital raised the target price to Rs 3,051, implying an upside of 62 percent, from Rs 1,875. The analysts at the firm have attributed the rise in the target price to increasing margin territory and an improving return ratio. The note added that TVS is gradually emerging as a key export major.
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