PINC Research has maintained its sell rating on TVS Motor Company with a target price of Rs 16 in its April 02, 2009 research report.
“TVS Motor Company sales volumes for the month were better than our expectations due to strong performance by scooty and mopeds segment. Overall 2-wheelers volumes were higher by 4.2% to 122k units in March’09. While the motorcycle segment declined 8.5% to 56k units, the company managed to post an impressive growth of 44.1% in the scooter segment to 23k units backed by the recently launched TVS Scooty Streak. In the moped segment also, TVSL posted a growth of 7.6% to 43k units. This is the best ever monthly sales for the moped segment. Exports for the month were higher by 25% to 16K.”
“We expect that domestic motorcycles sales have declined by 19% to 40K units during the month. The company is increasingly becoming dependent on mopeds and this will have an adverse impact on its profitability. We maintain our ‘SELL’ recommendation with a target price of Rs 16, discounting FY10E earnings 7.5x,” says PINC’s research report.
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