Tata Motors shares rise ahead of Q3 results. Here are analyst projections

Shares of Tata Motors were trading higher in Tuesday's trade, a day ahead of the automobile maker's December quarter results. The scrip rose 2 per cent to Rs 417 level amid hopes the Tata group firm may post healthy set of numbers for the quarter. 

On a standalone basis, Kotak Institutional Equities sees Tata Motors' losses narrowing to Rs 26.50 crore in the December quarter from Rs 215.70 crore loss in September and Rs 610 crore loss in the year-ago quarter. Revenue is seen rising 17.7 per cent YoY to Rs 14,544 crore compared with Rs 12,352.80 crore in the same quarter last year. Margin is seen expanding to 5.2 per cent from 4.4 per cent in September and 2.4 per cent in the corresponding quarter last year.

"We estimate standalone business revenues to decline by 3 per cent QoQ in Q3FY23 led by 5 per cent QoQ decline in volumes and 2 per cent QoQ increases in ASPs due to richer product mix mix. Overall, we expect Ebitda margin to improve to 5.2 per cent in Q3FY23 from 4.4 per cent in Q2FY23 led by RM tailwinds," it said.

On a consolidated basis, Kotak sees profit at Rs 800 crore against a loss of Rs 1,796 crore in the year-ago quarter. Sales are seen rising 14.50 per cent YoY to Rs 82,718 crore, Kotak said.

Motilal Oswal sees consolidated profit at Rs 160 crore. India business outlook remains healthy led by strong growth in PVs and CVs, it said. JLR volumes may grow YoY due to easing chip shortage issue, it said. The brokerage estimated Ebit margin of 3.7 per cent for JLR, supported by mix, softening RM and cost control.India Ebitda margin is estimated to expand 50 bps YoY due to easing RM cost inflation.

For the December quarter, Prabhudas Lilladher sees consolidated sales for Tata Motors at Rs 82,795.80 crore, up 14.6 per cent YoY over Rs 72,229.30 crore in the year-ago quarter. It sees Q3 losses at Rs 54.90 crore. Ebitda is seen rising 8.8 per cent to Rs 9,852.70 crore from Rs 9,056.80 crore YoY, but margin is seen falling to 11.9 per cent from 12.5 per cent YoY.

"Tata Motors' standalone revenue may decline 2.5 per cent QoQ, owing to 4.5 per cent drop in volumes. Ebitda margin to expand 60 bps as raw material cost easing out. We expect JLR volumes to grow in mid-single digit led by servicing of order book and semiconductor supply improving," Prabhudas Lilladher said.

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