The trends show that TVS Motors will remain bullish for a long period and show a constant improvement. All the researchers and the stock recommendations on the stock have a bullish view and expect the stock to reach the target of Rs 65 and above.
The Fiscal Year 2011 has turned out to be a fruitful one for both TVS motors and the Automotive Industry. The domestic industry saw a growth of around 25% and reached the levels of 11.8 million units. TVS was the best among all the segments and is in the right position to benefit from its growth. The exports have also contributed to the growth of TVS Motor with a growth of 48% leading to an overall growth of 33% to eclipse the 2 million mark.
However, even as the company draws traction on the volume front, its margins in mid single digits continue to lag peers. The losses suffered in Indonesia require some additional funding and some substantial investment to stretch the balance sheet.
TVS has got a balanced portfolio which treads to all the three segments in the two wheeler industry namely scooters, motorcycles, and mopeds. The scooter segment has witnessed a growth of about 50%, motorcycles grew up by 30% which was aided the launch of Max4R and the continued demand of Apache. Mopeds are a monopoly segment for TVS and have seen a growth of 23%. The profitability of TVS Motors has been comparatively low as compared to its peers which is primarily due to the high raw material cost and the high distribution and selling costs.
Bell The Bull says Buy TVS Motors, it will witness good rise for sometime and can be a good buy option