TVS Motor Company will report its earnings for the July to September 2024 quarter on October 23. Analysts polled by CNBC-TV18 expect the two-wheeler maker to report the highest sequential margin improvement seen amongst its peers.
TVS Motor’s revenue is likely to see a 31% growth in profit on a year-on-year basis to ₹703 crore from ₹537 crore in the second quarter of the previous fiscal, according to a CNBC-TV18 poll of analysts.
The two-wheeler maker’s revenue is expected to come in at ₹9,465 crore, a 16% year-on-year rise from ₹8,145 crore in the September 2023 ended quarter.
According to the poll, EBITDA or earnings before interest, taxes, depreciation, and amortisation is likely to see growth of 18% year-on-year to ₹1,133 crore for the quarter under review.
The margin is expected to come in at 12% versus 11% in Q2 last year. In the preceding June 2024 quarter, the two-wheeler maker’s margin stood at 11.5%, the analysts have projected.
They believe that TVS Motor Company will see the highest quarter-on-quarter margin improvement seen amongst two-wheeler makers, with operating leverage being one of the tailwinds. However, higher aluminium price and higher two-wheeler EV sales shall act as headwinds, they said.
The company shall record double-digit volume growth at 14% year-on-year and 13% quarter-on-quarter at 12.28 lakh units. The average selling price (ASP) is seen improving 1% sequentially on the back of a richer mix, they said.
Among other things that the Street will watch out for include e-mobility initiatives and demand outlook, especially any divergence in demand between urban and rural as well as North and South India.
The management’s remark will be significant as in August, the firm told CNBC-TV18 that rural sales are ahead of urban sales in the two-wheeler segment.
The company’s FY25 guidance for domestic and export markets, current inventory levels, and the sustainability of demand in the domestic three-wheeler market will also be key to track.
Meanwhile, the impact of commodity headwinds/tailwinds during the quarter and expected trends for the remaining half of the financial year will also be key to note.
Analysts have said that the Street will also await comments on the average price hike taken during the quarter and any planned price hikes, updates on fundraising for its EV company and EV volume market share for the company as well as updates on the ramp-up plans and new launches.
Content retrieved from: https://www.cnbctv18.com/market/earnings/tvs-motor-q2-results-preview-revenue-profit-estimate-margin-improvement-likely-to-be-highest-19497337.htm.
