10000 to 4crs in 18 months 1000rs to 50crs 300% returns 75% promoter holdings A 50 bagger A sureshot 5 bagger Analysis Another fraud? Auto ancillaries Bank sector Blind sell Brand plays Broking Bse Nse Buy calls cements Ceramics/tiles Counters I don't like Debt free businesses Delisting candidates demerger bets Disclosure- I own them Domestic consumption plays E-Commerce pick Education Exit at rallies Famous analysts Famous stocks FMCG Footwear future multibaggers Gems andJewellery Hidden gems High conviction ideas High dividend plays High potential small caps High ROE stocks Holding companies Hotel sector How they looted you.. Indian stock market Infrastructure sector Interesting Microcaps IT KPO Landbank plays largecap ideas Less than 5 PE stocks Liquor Logistics Market lessons Market outlook for 2013 and 2014 Market underperformers Meeting with the CEO Metals Monopoly businesses My 5 baggers My Favourite counters My paid stock recommendations My stock picking techniques nse bse tips Oil exploration Operator calls Paints Penny stock outlook penny stock updates Pharma sector Poultry stocks PSU Publicity freaks Real estate Renewable energy plays Safe bets Sell recommendations Share market Live shipping stocks short term call SOTP plays stock tips stock under 10rs Stocks to watch out for Strong bonus candidates Takeover candidates TATA product tea Textiles The 13 bagger The 45 bagger Trading companies Transformers Turnaround bets Tyres Uncertain/Risky business models Unique businesses

Search This Blog(Over 800 companies covered in the blog).

Archives : Old artciles

Saturday, October 10, 2009

Tata Motors Ltd:Future growth prospects and outlook,buy/sell?,analysis/news/views

Scripscan:Tata Motors Ltd

Story:Tata Motors is by far India''s largest commercial vehicle manufacturer with over 60% share of the domestic market. The company''s strength lie in its wide product portfolio that covers every segment and niche of the domestic commercial vehicle market right from sub-one tonne goods carrier to tractor trailers with capacity to haul to 75 tonnes of cargo. The company has an equally wide ranging presence in the passenger carrier segment. Through its Korean subsidiary Tata Daewoo Commercial Vehicle Company Limited (TDCV), the company is also the number two player in the S Korea.The company also rank among country''s top three manufacturers of passenger cars and utility vehicles. While in passenger car segment its market share is around 16-17%, it controls nearly a quarter of the domestic utility vehicle markets.While the last two years has been financially painful for the company, it used the downturn to advance its long-term strategy to emerge as one of world''s leading automobile manufacturer. It entered into a manufacturing & distribution joint venture with Fiat in India, besides acquiring Jaguar Land Rover, which gives it foothold in the luxury car market besides access to high end automotive technology.The company has set up a joint venture in Thailand to tap the growth opportunity in South-East Asia. In 2005, the company acquired 21% strategic stake in Hispano Carrocera S.A. (HC), a well-known Spanish bus manufacturing company and followed it by setting a 51-49% JV with Marcopolo SA, Brazil to manufacture world class buses in India.Last few years have been equally hectic for Tata Motors engineers who have been busy developing new products. Early this year, the company launched World Series trucks, which will eventually replace Tata''s existing fleet of medium & heavy CVs in the domestic market and would become a vehicle for the company''s entry in major markets outside India.In the passenger car segment, the company launched the new Indica followed by the commercial launch of Tata Nano, the world''s cheapest car. Though its contribution to Tata Motor''s finances is expected to be small initially, Nano has all ingredients to become a cash cow in the longer run.Tata Motor''s finances have been under stress for more than a year now. In the December ''08 quarter, company reported its quarterly loss for the first time in nearly seven years. It avoided losses in the following two quarters, but largely due to non-operational income such as profit from sale of assets.The company''s domestic business is now showing signs of improvement with the company reporting a rise in revenues and operating profit (on standalone basis) in the last two quarters. The company''s profitability however continues to be in danger from the financial cost related to the acquisition of troubled JLR. In June ''09 quarter, Tata Motors reported a net loss of nearly Rs 600 crore on consolidated basis against a net profit of Rs 513 crore on standalone basis. So far there''s clarity on JLR finances in the forthcoming quarters.Right now the stock is trading at nearly 24 times its 12 months trailing earnings per share (EPS) on standalone basis. Assuming a full recovery in the domestic CV market, the company is trading at around 15 times its forward EPS for FY10, which leaves little scope for further upside. Besides, the current price does not take into account the risk and uncertainty surrounding the future of JLR. Given this new investors are advised to stay away from the counter while existing investors are advised to book partial profits.

Important Disclaimer&Privacy policy

This blog does not share personal information with third parties nor do we store any information about your visit to this blog other than to analyze and optimize your content and reading experience through the use of cookies.You can turn off the use of cookies at anytime by changing your specific browser settings.This privacy policy is subject to change without notice and was last updated on 20.3.2013. If you have any questions, feel free to contact me directly here: Investment in equity shares has its own risks.Sincere efforts have been made to present the right investment perspective.The information contained herein is based on analysis and up on sources that I consider reliable. I,however,do not vouch for the accuracy or the completeness thereof.This material is for personal information and am not responsible for any loss incurred based upon it & take no responsibility whatsoever for any financial profits or loss which may arise from the recommendations above.The stock price projections shown are not necessarily indicative of future price performance.The information herein, together with all estimates and forecasts, can change without notice.

Subscription to Arunthestocksguru

Enter your email address:

Delivered by FeedBurner