M&M reported net profit at Rs8.82 bn. M&M continues to face pressure on UV business led by weak industry demand and higher competitive pressures. Recent hailstorms and delay in monsoon pose risks to our 5% tractor growth forecast for FY15. Maintain Buy Stock trades at 16.9XFY 16 earnings.
The sales were at Rs101bn in line with our estimates .Operating margin were a higher than our estimates. It reported Strong operational margins at 14.1% vs our estimates of 12.9%. Over all strong performance.
Key issues to watch out: Update on launch of three new UV platforms in CY15. Update on retail demand environment for auto and tractor division; plant and channel inventory. Considering competitive launches in FY15/FY16, guidance on auto volumes and margins. Guidance for FY15 tractor volumes. Update on Ssangyong business and financial performance.
Source : Sachin Murdeshwar