Tata Motors stock accelerated more than 4 percent on Thursday morning, powered by record global sales at its British luxury Jaguar Land Rover unit.
The company had reported after market closed on Wednesday that sales at JLR rose 16 percent year-on-year to 53,772 units in March, its best ever monthly sales performance.
Demand for JLR vehicles is driven by continued strong sales of the Range Rover Evoque launched last year, and good response to its other models like the new Range Rover and Jaguar XF Sportbrake.
Demand has been strong across global markets. For instance, sales in China surged 22 percent to 8,487 units in March. Sales of Jaguar saloons, in fact, almost doubled last month to 1,592 units. Among other markets, JLR sales in UK were up 14 percent and Europe sales rose 11 percent. Even in India, sales jumped 28 percent.
Many analysts remain bullish on Tata Motors, and expect the robust product portfolio and aggressive rollout of new vehicles to boost the company's earnings.
Higher-end Range Rover and Range Rover Sport account for 25 percent of volumes and given the higher average selling price (ASP), are important contributors to profitability, says a foreign brokerage, which has an "overweight" rating on Tata Motors.
Another foreign brokerage, which rates Tata Motors as its top pick in Indian Autos, says JLR is likely to surprise on its high ASP and high-margin products. It expects fourth quarter results will allay recent margin worries, with a strong 7 percent sequential ASP growth and 150bps quarter-on-quarter margin expansion.
At 9:40hrs, Tata Motors shares were up 4.5 percent at Rs 280.10 on NSE.
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