LIVE PROJECT ON TVS MOTO

Submitted By - Susmita Kar

Table of Contents
EIC analysis
DCF (FCFF)
WACC
Comps
Blended EV
Summary - Football Field
Recommendation
N TVS MOTORS
mita Kar

otball Field
 Historical --> Forecast -->
TVS MOTORS
In Crores, except per share data 2021A 2022A 2023A 2024E 2025E 2026E 2027E 2028E
Balance Sheet Check OK OK OK OK OK OK OK OK

Assumptions & Drivers

Days in Period 365 365 365 365 365 365 365 365

Income Statement
Sales Growth 25.4% 31.3% 28% 25.0% 22.0% 17.0% 13.0%
Gross Margin 30.4% 28.3% 33.8% 31.0% 31.0% 31.0% 31.0% 31.0%
Employee benefits expenses (Percent of Sales) 8.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0%
Other expenses (Percent of Sales) 10.6% 10.6% 10.5% 13.0% 13.0% 13.0% 13.0% 13.0%
Amortization (Percent of Sales) 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Deprciation (Percent of Sales) 2.9% 3.1% 2.7% 2.9% 2.9% 2.9% 2.9% 2.9%
Long Term Debt Interest (Average Debt) 4.5% 6.4% 6.4% 6.4% 6.4% 6.4% 6.4%
Tax Rate (Percent of EBT) 13.9% 30.4% 18.9% 21.0% 21.0% 21.0% 21.0% 21.0%

Balance Sheet
CAPEX as as % of Sales 5% 4% 4% 2.0% 1.5% 1.5% 1.0% 1.0%
Intangibles as as % of Sales -1.4% -12.0% -19.1% -19.1% -19.1% 0.2% 0.1% 0.1%
Receivable Days (Sales Basis) 19 18 14 17 16 16 16 16
Inventory Days (COGS Basis) 37 34 33 35 34 34 34 34
Payable Days (COGS Basis) 116 97 88 93 93 91 92 92
Long Term Debt 6,280 7,306 9,064 9,970 10,967 12,064 13,271 14,598
Common Share Capital 48 48 48 48 48 48 48 48
Dividend Payout Ratio 7.6% 23.4% 11.0% 14.0% 16.0% 14.0% 15.0% 15.0%

Cash Flow
Income Taxes paid 114% 76% 59% 83.0% 73.0% 72.0% 76.0% 74.0%

Income Statement

Revenues 19,421 24,355 31,974 40,927 51,158 62,413 73,024 82,517

Cost of Goods Sold 13,516 17,472 21,165 28,239 35,299 43,065 50,386 56,936
Gross Profit 5,905 6,883 10,809 12,687 15,859 19,348 22,637 25,580
Employee benefits expenses 1,547 2,191 2,875 3,680 4,600 5,612 6,566 7,420
Other expenses 2,062 2,592 3,353 5,320 6,651 8,114 9,493 10,727
Amortization expense - - - - - - - -
Depreciation expense 565 743 859 1,174 1,468 1,790 2,095 2,367
Operating Profit 1,731 1,357 3,722 2,513 3,141 3,832 4,483 5,066
Finance costs 245 303 523 608 669 736 809 890
Other Income 47 33 74 74 74 74 74 74
Share of profit of associates / joint ventures - - - - - - - -
Income Before Taxes 1,533 1,087 3,273 1,979 2,546 3,170 3,748 4,250
Taxes 213 330 619 416 535 666 787 892
Net Income 1,320 757 2,654 1,563 2,011 2,504 2,961 3,357

Common Dividends 100 177 292 219 322 351 444 504

Balance Sheet

ASSETS
Current Assets:
Cash 1,657 1,536 1,879 13,716 27,174 31,921 37,714 43,908
Trade and Other Receivables 1,029 1,177 1,232 1,907 2,276 2,697 3,269 3,644
Inventories 1,367 1,642 1,922 2,692 3,296 4,013 4,734 5,324
Other Current Assets 6,143 8,757 8,773 7,891 8,474 8,379 8,248 8,367
Total Current Assets 10,196 13,112 13,806 26,206 41,219 47,010 53,965 61,243
Non-Current Assets:

© Management Development Associates (NA) Inc. - 21317

Property Plant and Equipment & CWIP 1,041 552 743 387 (313) (1,167) (2,531) (4,073)
Intangible Assets 4,491 5,325 8,580 749 (9,040) (8,915) (8,842) (8,759)
Other non-current asets 6,137 7,930 11,896 11,896 11,896 11,896 11,896 11,896
TOTAL ASSETS 21,865 26,919 35,025 39,239 43,763 48,824 54,487 60,306

LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities:
Trade and Other Payables 4,299 4,663 5,097 7,169 8,961 10,745 12,718 14,343
Other Current Liabilities 997 1,098 1,304 1,133 1,178 1,205 1,172 1,185
Total Current Liabilities: 5,296 5,761 6,401 8,302 10,140 11,950 13,890 15,528
Non-Current Liabilities:
Borrowings 6,280 7,306 9,064 9,970 10,967 12,064 13,271 14,598
Other Non-current Liabilities 3,069 7,992 12,562 12,562 12,562 12,562 12,562 12,562
Shareholder's Equity:
Equity Share Capital 48 48 48 48 48 48 48 48
Other Equity 3,393 1,460 1,493 1,493 1,493 1,493 1,493 1,493
Retained Earnings 3,779 4,352 5,457 6,863 8,553 10,707 13,223 16,077
Total Shareholders' Equity 7,220 5,860 6,998 8,404 10,094 12,248 14,764 17,618
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 21,865 26,919 35,025 39,239 43,763 48,824 54,487 60,306
- - - - -
Check 0.000 0.000 (62.000) 0.000 0.000 0.000 0.000 0.000

Cash Flow Statement

Cash Flows from Operating Activities:

Profit Before Tax 1,533 1,087 3,273 1,979 2,546 3,170 3,748 4,250
Amortization expense 0 0 0 - - - - -
Depreciation expense 565 743 859 1,174 1,468 1,790 2,095 2,367
Other changes in operating activities (793) (328) (1,966) (71) (144) (186) (189) (232)
Finance costs 245 303 523 608 669 736 809 890
Changes in Operating Assets and Liabilities:
Trade and Other Receivables 399 (143) (71) (675) (369) (420) (572) (375)
Inventories (179) (275) (314) (770) (604) (717) (721) (590)
Trade and Other Payables 1,114 366 517 2,072 1,792 1,784 1,973 1,625
Finance and Other Current Assets (1,701) (2,860) (6,531) 882 (583) 94 131 (119)
Other Current Liabilities 210 (217) (329) (171) 45 27 (33) 13
Income Taxes paid (242) (251) (366) (345) (390) (479) (598) (660)
Net Cash Provided by Operating Activities 1,151 (1,575) (4,405) 4,683 4,430 5,799 6,643 7,169

Investing Activities:
Acquisitions of Property and Equipment & CWIP (928) (970) (1,341) (819) (767) (936) (730) (825)
Payments for purchase of intangible assets 264 2,918 6,118 7,831 9,789 (125) (73) (83)
Other Investing Activities 46 (501) 33 - - - - -
Cash Flows from Investing Activities (882) (1,471) (1,308) 7,013 9,021 (1,061) (803) (908)

Financing Activities:
Lease payments 1,271 3,353 6,588 6,588 6,588 6,588 6,588 6,588
Dividends (100) (177) (292) (219) (322) (351) (444) (504)
Finance cost paid (55) (7) - (608) (669) (736) (809) (890)
Movement of Long-Term & Short-term Debt (852) (244) (178) (5,682) (5,591) (5,491) (5,382) (5,261)
Cash Flows from Financing Activities 264 2,925 6,118 79 6 10 (47) (67)

Increase/(Decrease) in Cash and Equivalents 533 (121) 405 11,775 13,457 4,748 5,793 6,194
Cash and Equivalents, Beginning of the Year 1,124 1657 1536 1,941 13,716 27,174 31,921 37,714
Cash and Equivalents, End of the Year 1,657 1,536 1,941 13,716 27,174 31,921 37,714 43,908

Supporting Schedules

Property Plant and Equipment (PP&E)

Net PP&E
Beginning of Period 678 1,041 1,268 743 387 (313) (1,167) (2,531)
Capital Expenditures/Additions (Disposals) 928 970 1,341 819 767 936 730 825

© Management Development Associates (NA) Inc. - 21317

Depreciation Expense 565 743 859 1,174 1,468 1,790 2,095 2,367
Net PP&E End of Period 1,041 1,268 1,750 387 (313) (1,167) (2,531) (4,073)

Intangibles
Beginning of Period 5,762 4,491 1,573 8,580 749 (9,040) (8,915) (8,842)
Capital Expenditures/Additions (Disposals) (1,271) (2,918) (6,118) (7,831) (9,789) 125 73 83
Amortization expense 0 0 0 - - - - -
Net Intangibles End of Period 4,491 1,573 (4,545) 749 (9,040) (8,915) (8,842) (8,759)

Retained Earnings (RE)

Beginning of Period 2,559 3,779 4,359 5,457 6,801 8,491 10,645 13,161
Net Income 1,320 757 2,654 1,563 2,011 2,504 2,961 3,357
Dividends 100 177 292 219 322 351 444 504
RE End of Period 3,779 4,359 6,721 6,801 8,491 10,645 13,161 16,015

Long Term Debt (LTD)

Beginning of Period 7,132 6,280 7,306 9,064 9,970 10,967 12,064 13,271
Lease Payments 1,271 3,353 6,588 6,588 6,588 6,588 6,588 6,588
Additions (Repayments) (852) (2,327) 1,758 (5,682) (5,591) (5,491) (5,382) (5,261)
LTD End of Period 6,280 7,306 9,064 9,970 10,967 12,064 13,271 14,598

Long Term Debt Interest 245 303 523 608 669 736 809 890
Total Interest 245 303 523 608 669 736 809 890

Charts & Graphs

- - 10.0%
2 2 3 3 4 4 5 6

-
1 6 5 9 3 8 4 0
, , , , , , , ,
8 9 0 2 7 8 4 3

2021A 2022A 2023A 2024A 2025A 2026A 2027A 2028A

6 1 2 3 6 2 8 0
5 9 5 9 3 4 7 6

2021A 2022A 2023A 2024A 2025A 2026A 2027A 2028A -

2021A 2022A 2023A 2024A 2025A 2026A 2027A 2028A
- 10.0%

Ratio Analysis

Working Capital 4,900 7,351 7,405 17,904 31,080 35,060 40,074 45,715
Net Working Capital 3,243 5,815 5,526 4,188 3,906 3,138 2,360 1,807

Liquidity ratios:
Current Ratio 1.93 2.28 2.16 3.16 4.07 3.93 3.89 3.94
Quick Ratio 1.67 1.99 1.86 2.83 3.74 3.60 3.54 3.60
Cash Ratio 0.31 0.27 0.29 1.65 2.68 2.67 2.72 2.83
Working Capital Turnover Ratio 3.96 3.98 4.33 3.23 2.09 1.89 1.94 1.92

Profitability ratios: 20.88%

CAGR 25.41% 28.31% 28.21% 27.40% 26.30% 24.70% 22.96%
Gross Profit Margin 30.4% 28.3% 33.8% 31.0% 31.0% 31.0% 31.0% 31.0%
Operating Profit Margin 8.9% 5.6% 11.6% 6.1% 6.1% 6.1% 6.1% 6.1%
EBITDA Margin 12.1% 8.8% 14.6% 9.2% 9.2% 9.1% 9.1% 9.1%
PBT Margin 7.9% 4.5% 10.2% 4.8% 5.0% 5.1% 5.1% 5.2%
Net Profit Margin 6.8% 3.1% 8.3% 3.8% 3.9% 4.0% 4.1% 4.1%
Return on Assets 6.0% 3.1% 8.6% 4.2% 4.8% 5.4% 5.7% 5.8%
Return on Equity 18.3% 11.6% 41.3% 20.3% 21.7% 22.4% 21.9% 20.7%

Solvency ratios:
Debt-to-Equity Ratio 0.87 1.25 1.30 1.19 1.09 0.99 0.90 0.83
Debt Ratio 0.29 0.27 0.26 0.25 0.25 0.25 0.24 0.24
Interest Coverage Ratio 7.26 4.59 7.26 4.25 4.81 5.31 5.63 5.77
Debt Service Coverage Ratio 1.62 2.54 5.42 0.41 0.51 0.63 0.74 0.84
Financial Leverage Ratio 3.03 4.59 5.01 4.67 4.34 3.99 3.69 3.42

Efficiency ratios:
Accounts Receivable Turnover Ratio 18.87 22.08 26.55 26.07 24.46 25.10 24.48 23.87
Days Sales Outstanding (DSO) 19.34 16.53 13.75 14.00 14.92 14.54 14.91 15.29
Accounts Payable Turnover Ratio 3.144 3.899 4.337 4.605 4.377 4.371 4.295 4.208
Days Payable Outstanding (DPO) 116.09 93.61 84.16 79.27 83.39 83.51 84.98 86.74
Inventory Turnover Ratio 9.887 11.613 11.877 12.242 11.791 11.785 11.522 11.322
Days Sales of Inventory (DSI) 36.92 31.43 30.73 29.82 30.96 30.97 31.68 32.24
Asset Turnover Ratio 0.89 0.90 0.91 1.04 1.17 1.28 1.34 1.37

© Management Development Associates (NA) Inc. - 21317

Fixed Asset Turnover Ratio 18.66 44.12 43.03 105.62 -163.62 -53.49 -28.85 -20.26
Cash Conversion Cycle -59.84 -45.65 -39.68 -35.46 -37.51 -38.00 -38.40 -39.21

Cash Flow ratios:

Operating cash Flow Ratio 0.22 -0.27 -0.69 0.56 0.44 0.49 0.48 0.46
Cash Flow to Debt Ratio 0.10 -0.12 -0.28 0.26 0.21 0.24 0.24 0.24
Cash Flow Margin 0.06 -0.06 -0.14 0.11 0.09 0.09 0.09 0.09
Cash Return on Assets 0.05 -0.06 -0.13 0.12 0.10 0.12 0.12 0.12
CFO / (CFI + CFF) 1.86 1.08 0.92 -0.66 -0.49 5.52 7.81 7.36

DCF Model

Assumptions
Tax Rate 22%
Discount Rate (WACC) 14%
Perpetural Growth Rate 4%
EV/EBITDA Mulltiple 32.0x Industry average and TVS Motors EV / EBITDA multiple
Valuation Date 2/9/2024
Fiscal Year End 3/31/2023
Current Price 2,146.25
Shares Outstanding 47.51

Discounted Cash Flow (FCFF) 2024 2025 2026 2027 2028 Terminal Terminal Value
Date 3/31/2024 3/31/2025 3/31/2026 3/31/2027 3/31/2028 3/31/2028 Perpetural Growth Method 61,017
Time Periods 1 2 3 4 5 H model method 66,297
Year Fraction 0.14 1.00 1.00 1.00 1.00 EV/EBITDA multiple 240,385
EBT 1,979 2,546 3,170 3,748 4,250 Average 153,341
Interest 608 669 736 809 890
EBIT 2,587 3,215 3,906 4,557 5,140 N (for H model) 2
Less: Cash Taxes 561 698 848 989 1,116 Capitalization rate 10%
Plus: D&A 1,174 1,468 1,790 2,095 2,367
Less: Capex (7,013) (9,021) 1,061 803 908
Less: Changes in NWC (1,338) (282) (768) (778) (554)
Unlevered FCF (FCFF) 11,550 13,288 4,555 5,638 6,038 153,341
Unlevered FCF (period adjusted) 1,668 13,288 4,555 5,638 6,038 153,341
Discount Period 0.07 0.64 1.64 2.64 3.64 3.64
Present Value Factor (14.29% Discount Rate) 0.9904 0.9175 0.8028 0.7024 0.6146 0.6146
Net FCF 1,652 12,192 3,657 3,960 3,711 94,241

Intrinsic Value Market Value Rate of Return

Enterprise Value 119,413 Market Cap 101,968 Target Price Upside -2%
Plus: Cash 1,879 Plus: Debt 21,626
Less: Debt 21,626 Less: Cash 1,879
Equity Value 99,666 EV 121,715

Equity Value/Share 2,097.78 Equity Value/Share 2,146.25

Charts and Graphs

2024 2025 2026 2027 2028 Market Value vs Intrinsic Value

Free Cash Flow 11,550 13,288 4,555 5,638 6,038 Market Value 2,146.25
Upside (48.47)
Intrinsic Value 2,097.78

This chart isn't available in your version of Excel.

Free Cash Flow
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© Management Development Associates (NA) Inc. - 21317

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Free Cash Flow
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2024 2025 2026 2027 2028

Sensitivity analysis

Discount Rate (WACC)

2,097.78 12% 13% 14% 15% 16%
8%
7%
Perpetural Growth Rate 6%
5%
4%

© Management Development Associates (NA) Inc. - 21317

WACC

Economic Data
Risk-free rate 6.20%
Equity Risk Premium 8.33%
Tax rate 21.71%

Modified CAPM method

Cost of Equity
Risk-free rate 6%
Equity Risk Premium 8.33%
Levered Beta 4.47
Company Specific Risk Premium 0.00%
Cost of Equity 43.45%

Capital Structure of the company (in INR million)

Debt ₹ 21,626.00
Equity ₹ 6,998.00
Total Capital ₹ 28,624.00
D/E 3.09

https://in.investing.com/rates-bonds/india-government-bonds?maturity_from=10&maturity_to=300
http://www.worldgovernmentbonds.com/country/india/
 Levered Beta
Average Industry Beta 1.31
D/E Ratio 3.09
Tax Rate 22%
Levered Beta 4.47

Cost of Debt
Risk Free rate 6.2%
Credit Rating 0%
Default Spread 0%
Tax Rate 22%
After-tax cost of debt 4.85%

Weighted Average Cost of Capital

Cost of Equity 43%
Weight of equity 24%

After Tax cost of debt 5%

Weight of Debt 76%
WACC 14.29%

m=10&maturity_to=300
Date updated: 5-Jan-23
Created by: Aswath Damodaran, adamodar@stern.nyu.edu
What is this data? Beta, Unlevered beta and other risk measures India
Home Page: http://www.damodaran.com
Data website: https://pages.stern.nyu.edu/~adamodar/New_Home_Page/data.html
Companies in each industry: https://pages.stern.nyu.edu/~adamodar/pc/datasets/indname.xls
Variable definitions: https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/variable.htm
Do you want to use marginal or effective tax rates in unlevering betas? Marginal
If marginal tax rate, enter the marginal tax rate to use 30.00%

Effective Tax
Industry Name Number of firms Beta D/E Ratio rate Unlevered beta Cash/Firm value
Advertising 13 1.39 1.16% 21.26% 1.38 2.40%
Aerospace/Defense 13 1.35 0.38% 25.61% 1.34 17.17%
Air Transport 6 1.52 88.22% 12.33% 0.94 7.59%
Apparel 323 0.88 21.13% 17.64% 0.77 1.65%
Auto & Truck 12 1.54 30.13% 14.76% 1.27 4.56%
Auto Parts 107 1.31 14.32% 21.71% 1.19 3.48%
Bank (Money Center) 32 1.78 54.77% 14.18% 1.29 22.99%
Banks (Regional) 5 1.49 33.30% 20.87% 1.21 12.31%
Beverage (Alcoholic) 19 0.78 1.81% 14.53% 0.77 1.49%
Beverage (Soft) 5 0.62 2.94% 8.60% 0.61 0.03%
Broadcasting 17 1.09 10.06% 13.38% 1.02 3.75%
Brokerage & Investment Banking 174 0.65 82.98% 13.79% 0.41 22.13%
Building Materials 48 1.23 8.96% 17.68% 1.16 1.76%
Business & Consumer Services 58 0.67 3.83% 12.00% 0.65 4.46%
Cable TV 8 1.21 27.13% 6.64% 1.02 12.30%
Chemical (Basic) 128 1.12 13.23% 20.03% 1.03 2.32%
Chemical (Diversified) 10 1.03 3.07% 26.39% 1.01 0.91%
Chemical (Specialty) 167 0.95 10.31% 21.17% 0.89 2.02%
Coal & Related Energy 2 1.28 2.78% 31.76% 1.26 26.81%
Computer Services 132 0.83 2.63% 16.06% 0.81 1.85%
Computers/Peripherals 6 0.41 9.20% 18.27% 0.38 3.94%
Construction Supplies 92 1.17 21.98% 16.82% 1.01 1.52%
Diversified 13 1.01 18.57% 16.43% 0.89 4.89%
Drugs (Biotechnology) 8 1.07 18.34% 10.18% 0.95 4.45%
Drugs (Pharmaceutical) 156 1.05 6.19% 21.11% 1.00 3.52%
Education 26 0.79 11.16% 11.70% 0.74 3.56%
Electrical Equipment 102 1.07 6.99% 15.69% 1.02 4.06%
Electronics (Consumer & Office) 8 1.08 3.34% 17.06% 1.06 1.03%
Electronics (General) 27 0.48 3.37% 14.97% 0.47 4.35%
Engineering/Construction 144 1.26 57.16% 15.18% 0.90 6.29%
Entertainment 60 0.75 46.68% 9.02% 0.56 3.37%
Environmental & Waste Services 10 1.17 5.31% 18.50% 1.12 8.64%
Farming/Agriculture 57 0.62 18.50% 16.37% 0.55 1.56%
Financial Svcs. (Non-bank & Insurance) 254 0.79 186.80% 15.80% 0.34 2.79%
Food Processing 185 0.90 7.74% 16.39% 0.85 2.65%
Food Wholesalers 32 0.56 17.18% 13.99% 0.50 4.55%
Furn/Home Furnishings 38 0.71 4.56% 19.91% 0.69 2.91%
Green & Renewable Energy 18 1.43 28.72% 11.70% 1.19 1.09%
Healthcare Products 13 0.75 2.55% 17.59% 0.74 2.15%
Healthcare Support Services 30 0.54 3.75% 16.63% 0.53 2.88%
 Effective Tax
Industry Name Number of firms Beta D/E Ratio rate Unlevered beta Cash/Firm value
Heathcare Information and Technology 14 1.47 3.37% 17.30% 1.43 3.35%
Homebuilding 1 -1.07 2.96% 33.33% -1.04 0.75%
Hospitals/Healthcare Facilities 24 0.82 5.95% 18.23% 0.79 2.09%
Hotel/Gaming 57 0.95 13.28% 14.28% 0.87 3.74%
Household Products 36 0.75 0.50% 13.29% 0.75 0.69%
Information Services 24 1.21 7.77% 22.06% 1.15 9.34%
Insurance (General) 2 2.00 133.96% 0.00% 1.03 8.26%
Insurance (Life) 7 1.30 1.13% 12.45% 1.29 4.52%
Insurance (Prop/Cas.) 2 1.63 0.57% 11.03% 1.62 13.24%
Investments & Asset Management 96 0.64 21.10% 14.32% 0.56 3.15%
Machinery 149 1.06 5.78% 18.70% 1.02 2.92%
Metals & Mining 39 1.21 34.66% 19.87% 0.97 6.28%
Office Equipment & Services 13 0.88 7.83% 22.46% 0.84 4.82%
Oil/Gas (Integrated) 1 1.42 86.30% 26.54% 0.89 9.28%
Oil/Gas (Production and Exploration) 6 1.26 130.02% 11.97% 0.66 8.00%
Oil/Gas Distribution 11 0.88 21.64% 12.96% 0.77 15.93%
Oilfield Svcs/Equip. 22 1.18 36.23% 17.13% 0.94 2.12%
Packaging & Container 79 0.89 47.34% 17.59% 0.67 3.78%
Paper/Forest Products 50 0.69 25.18% 17.03% 0.59 2.28%
Power 30 1.08 44.44% 16.88% 0.83 1.86%
Precious Metals 1 3.21 0.97% 0.00% 3.19 0.49%
Publishing & Newspapers 25 0.74 27.54% 14.70% 0.62 5.36%
R.E.I.T. 4 0.73 33.35% 12.92% 0.59 1.21%
Real Estate (Development) 137 0.88 29.56% 12.70% 0.73 3.20%
Real Estate (General/Diversified) 15 1.58 11.49% 15.48% 1.46 2.55%
Real Estate (Operations & Services) 30 0.77 21.41% 15.16% 0.67 1.99%
Recreation 11 0.40 26.15% 7.31% 0.34 1.81%
Reinsurance 1 1.77 0.00% 34.77% 1.77 74.26%
Restaurant/Dining 13 1.20 10.86% 15.38% 1.12 0.97%
Retail (Automotive) 4 0.39 12.32% 11.54% 0.36 3.31%
Retail (Building Supply) 2 1.41 14.77% 12.05% 1.28 1.92%
Retail (Distributors) 239 0.52 10.80% 12.49% 0.48 1.43%
Retail (General) 5 1.06 152.52% 4.19% 0.51 0.20%
Retail (Grocery and Food) 5 0.76 0.31% 10.31% 0.75 0.44%
Retail (Online) 13 1.48 2.26% 10.78% 1.46 2.13%
Retail (Special Lines) 28 1.04 15.53% 18.87% 0.94 1.11%
Rubber& Tires 16 1.27 20.39% 18.27% 1.11 1.33%
Semiconductor 8 2.08 7.74% 11.79% 1.97 0.48%
Semiconductor Equip 1 1.88 3.27% 22.46% 1.84 0.79%
Shipbuilding & Marine 20 1.25 29.42% 12.56% 1.03 3.15%
Shoe 12 0.40 3.97% 16.65% 0.39 0.70%
Software (Entertainment) 7 1.19 0.74% 16.40% 1.18 3.28%
Software (Internet) 7 0.49 2.28% 4.82% 0.48 2.20%
Software (System & Application) 74 1.17 3.08% 15.61% 1.14 7.92%
Steel 157 1.15 43.95% 17.39% 0.88 5.48%
Telecom (Wireless) 3 1.86 105.89% 10.13% 1.07 1.37%
Telecom. Equipment 20 1.20 22.23% 11.72% 1.04 4.28%
Telecom. Services 13 1.11 68.86% 9.66% 0.75 1.08%
Tobacco 5 0.65 0.15% 20.37% 0.65 1.17%
 Effective Tax
Industry Name Number of firms Beta D/E Ratio rate Unlevered beta Cash/Firm value
Transportation 38 1.13 24.59% 12.70% 0.96 3.82%
Transportation (Railroads) 1 1.48 1.69% 24.30% 1.46 7.50%
Trucking 12 0.84 19.64% 19.84% 0.73 1.29%
Utility (General) 0 0.00 NA 0.00% NA NA
Utility (Water) 1 1.73 19.13% 20.73% 1.52 12.31%
Total Market 4149 0.94 36.51% 16.29% 0.75 6.10%
Total Market (without financials) 3577 0.96 21.39% 16.53% 0.84 3.14%
 Marginal
Effective

Standard deviation in Average

operating income (last Beta: 2019-
Unlevered beta corrected for cash HiLo Risk Standard deviation of equity 10 years) Beta: 2019 Beta: 2020 Beta: 2021 Beta: 2022 23
1.42 0.4243 44.11% 156.14% 0.72 1.96 1.16 1.43 1.34
1.62 0.3889 36.86% 140.54% 1.38 1.30 1.53 1.92 1.55
1.01 0.2912 38.41% 421.56% 0.74 0.33 1.27 1.58 0.99
0.78 0.4345 41.30% 42.22% 0.63 0.50 0.70 0.74 0.67
1.33 0.2828 25.48% 19.13% 1.09 1.02 1.57 1.70 1.34
1.23 0.3272 31.37% 46.74% 0.95 0.73 1.38 1.59 1.18
1.67 0.3557 29.65% NA 1.01 1.15 2.03 2.60 1.69
1.38 0.2996 26.52% NA 1.52 0.99 1.67 2.28 1.57
0.78 0.3105 30.32% 90.50% 0.9 0.26 0.90 1.10 0.79
0.61 0.5017 38.56% 63.65% 0.25 0.20 0.54 0.54 0.43
1.06 0.4219 38.11% 57.50% 0.37 0.02 0.74 0.92 0.62
0.53 0.4225 44.34% 109.25% 0.46 0.35 0.42 0.49 0.45
1.18 0.4092 41.32% 60.97% 0.95 0.68 1.04 1.36 1.04
0.68 0.4141 40.91% 100.58% 0.98 0.54 0.64 0.68 0.70
1.16 0.4239 35.83% 62.77% 0.55 0.61 1.13 1.29 0.95
1.05 0.3722 36.53% 45.54% 0.85 0.59 1.04 1.22 0.95
1.01 0.2470 26.87% 58.53% 0.82 0.44 1.08 1.24 0.92
0.91 0.3630 34.69% 55.77% 0.91 0.69 1.15 1.27 0.99
1.72 0.4043 31.76% 19.75% 0.91 1.08 1.84 2.02 1.51
0.83 0.4417 42.66% 22.27% 0.59 0.58 0.77 0.81 0.72
0.40 0.4209 43.94% NA 0.72 0.25 0.64 0.76 0.55
1.03 0.3482 32.93% 57.17% 1.13 0.80 1.04 1.19 1.04
0.94 0.3000 27.08% 39.25% 1.09 0.70 1.32 1.31 1.07
0.99 0.3399 42.72% 33.85% 0.99 0.63 0.82 1.14 0.91
1.04 0.3526 34.18% 22.59% 0.65 0.64 1.13 1.19 0.93
0.76 0.4718 43.20% 167.97% 1.2 0.73 0.65 0.85 0.84
1.06 0.4219 39.47% 71.87% 1.05 0.87 1.12 1.19 1.06
1.07 0.4421 40.28% 117.97% 1.35 1.83 1.59 1.34 1.44
0.50 0.3763 38.18% 40.60% 0.7 0.51 0.64 0.68 0.61
0.96 0.4129 39.12% 47.98% 1.01 0.69 0.75 0.95 0.87
0.58 0.4438 42.94% 84.48% 0.33 0.26 0.47 0.59 0.45
1.23 0.3727 36.79% 163.89% 0.33 0.58 0.96 1.25 0.87
0.56 0.4173 38.91% 45.88% 0.71 0.60 0.73 0.67 0.65
0.35 0.4274 41.31% 59.90% 0.44 0.26 0.30 0.36 0.34
0.87 0.3994 38.30% 47.08% 0.94 0.75 0.97 1.03 0.91
0.52 0.4773 44.95% 78.45% 0.53 0.46 0.43 0.49 0.49
0.71 0.3534 31.40% 48.36% 0.69 0.66 0.90 0.99 0.79
1.20 0.4513 50.43% 124.81% 0.9 0.60 0.75 0.80 0.85
0.76 0.3796 39.96% 146.00% 0.73 0.75 0.49 0.57 0.66
0.54 0.4304 38.79% 100.33% 0.72 0.63 0.80 1.00 0.74
 Standard deviation in Average
operating income (last Beta: 2019-
Unlevered beta corrected for cash HiLo Risk Standard deviation of equity 10 years) Beta: 2019 Beta: 2020 Beta: 2021 Beta: 2022 23
1.48 0.3625 33.61% 90.08% 0.77 0.67 1.24 1.46 1.12
-1.05 0.4934 NA 41.06% -0.13 0.16 0.91 #VALUE! #VALUE!
0.80 0.2983 29.10% 160.36% 0.39 0.27 0.73 0.86 0.61
0.91 0.3610 36.93% 2443.91% 0.74 0.50 0.81 1.09 0.81
0.75 0.3424 34.82% 65.37% 0.4 0.39 0.74 0.79 0.61
1.27 0.4030 39.84% 42.59% 0.74 0.65 1.32 1.30 1.06
1.12 0.4723 43.25% 140.23% 0.68 0.31 1.33 0.04 0.70
1.35 0.2303 22.14% 31.21% 1.1 0.64 1.17 1.42 1.14
1.87 0.2336 24.52% 80.36% 1.22 0.51 1.19 1.63 1.28
0.57 0.4014 39.05% 107.83% 0.52 0.39 0.55 0.55 0.52
1.05 0.3725 36.82% 36.59% 0.86 0.54 1.01 1.13 0.92
1.04 0.4291 41.89% 52.87% 0.96 0.73 0.82 1.08 0.93
0.88 0.4771 46.08% 79.73% 0.43 0.76 0.71 0.84 0.72
0.98 0.2388 22.56% 50.27% 1.58 1.18 0.99 1.25 1.20
0.72 0.3721 34.87% 114.97% 0.86 0.54 0.64 1.27 0.81
0.91 0.3998 37.18% 62.62% 0.97 0.64 1.03 1.09 0.93
0.96 0.3889 35.22% 79.69% 1.11 1.13 1.22 1.31 1.15
0.69 0.4167 40.05% 29.96% 0.78 0.51 0.72 0.83 0.71
0.60 0.3783 34.81% 43.05% 0.51 0.42 0.64 0.95 0.62
0.84 0.3110 33.34% 76.06% 0.83 0.43 0.65 0.80 0.71
3.21 0.4584 46.42% NA 0.69 0.21 0.32 1.94 1.27
0.66 0.4171 35.35% 40.61% 0.68 0.55 0.73 0.78 0.68
0.60 0.1274 10.27% 87.82% NA 0.56 1.16 0.78 0.77
0.75 0.4299 43.85% 33.49% 0.69 0.57 0.57 0.68 0.65
1.50 0.3674 35.35% 30.44% 1.18 1.14 1.17 1.21 1.24
0.68 0.3201 35.86% 55.32% 0.5 0.25 0.52 0.64 0.52
0.34 0.4640 43.49% 378.06% 0.54 0.61 0.74 0.53 0.55
6.86 0.3135 29.47% 95.33% 0.78 1.21 6.75 10.51 5.22
1.13 0.3777 38.20% 201.57% 0.93 1.44 0.78 0.54 0.96
0.37 0.2924 31.88% 50.52% 0.73 0.35 0.39 0.58 0.48
1.30 0.3725 41.52% 131.47% 0.33 0.56 0.71 0.84 0.75
0.49 0.4593 41.62% 69.06% 0.39 0.44 0.50 0.46 0.46
0.51 0.4581 31.56% 2021.77% 1.22 0.68 1.34 1.43 1.04
0.76 0.4062 38.11% 154.07% 1.64 0.86 0.56 0.63 0.89
1.49 0.4705 44.48% NA 1.26 1.23 1.62 0.88 1.30
0.95 0.4044 38.02% 233.16% 1.33 0.79 0.64 1.12 0.97
1.12 0.3963 32.41% 32.82% 0.85 0.60 1.21 1.49 1.05
1.98 0.5065 55.18% 1482.85% 0.74 0.73 1.16 1.77 1.28
1.85 0.2812 36.49% 123.73% NA NA 2.58 3.20 2.54
1.07 0.4168 43.86% 31.69% 0.92 0.65 1.05 1.02 0.94
0.39 0.3771 33.13% 46.52% 1 1.01 1.05 1.08 0.91
1.22 0.3686 38.61% 89.51% 0.92 0.59 1.16 1.13 1.00
0.49 0.4695 44.14% 3825.34% 0.33 1.04 0.52 0.65 0.61
1.24 0.3966 44.34% 35.06% 0.79 0.83 1.20 1.20 1.05
0.93 0.3974 40.42% 88.72% 0.81 0.54 0.74 1.01 0.81
1.08 0.3312 35.06% 79.09% 0.68 0.58 0.73 0.94 0.80
1.08 0.3818 40.28% 139.11% 0.77 0.75 1.20 1.28 1.02
0.76 0.4232 41.91% 70.90% 0.41 0.21 0.96 1.01 0.67
0.65 0.3050 24.35% 154.64% 0.92 0.69 0.94 1.02 0.84
 Standard deviation in Average
operating income (last Beta: 2019-
Unlevered beta corrected for cash HiLo Risk Standard deviation of equity 10 years) Beta: 2019 Beta: 2020 Beta: 2021 Beta: 2022 23
1.00 0.4061 41.03% 29.84% 0.68 0.41 0.77 0.99 0.77
1.58 0.1988 24.37% 20.96% 1.25 0.68 1.52 1.91 1.39
0.74 0.4435 42.67% 64.35% 1.88 0.78 0.71 0.70 0.96
NA 0.0000 0.00% NA 0.81 NA NA NA 0.81
1.74 0.2689 38.60% 20.74% 0.81 0.81 2.37 2.21 1.59
0.80 0.4013 38.60% 42.88% 0.74 0.58 0.81 0.90 0.77
0.86 0.3993 38.25% 43.21% 0.79 0.62 0.88 0.97 0.82
Company Comparison Model 13:03 on 11/05/2021

Company Ticker Last Period Price Market Cap - Enterprise Sales EBITDA EBIT Sales EBITDA EV/Sales EV/EBITDA EV/Sales EV/EBITDA
End Date Consolidated Value LTM LTM LTM FY1 FY1 LTM LTM FY1 FY1
Mahindra & Mahindra Limited (NSEI:M&M) 30-Sep-23 1,646.40 1,833,509.70 2,714,359.40 1,325,527.20 1,221,851.90 194,963.10 1,418,003.52 268,046.58 2.05 2.22 1.91 10.13
Tata Motors Limited (BSE:500570) 31-Dec-23 914.95 3,348,202.50 4,114,809.90 238,738.10 1,050,145.50 326,040.20 4,605,450.69 653,149.61 17.24 3.92 0.89 6.30
Ashok Leyland Limited (NSEI:ASHOKLEY) 31-Dec-23 173.45 509,271.30 821,577.70 1,454,156.10 171,913.90 63,451.10 235,467.00 453,267.00 0.56 4.78 1.26 8.90
Bajaj Auto Limited (NSEI:BAJAJ-AUTO) 31-Dec-23 7,784.85 2,204,511.90 2,149,782.60 1,432,663.40 102,276.80 89,297.60 491,591.63 107,890.75 1.50 21.02 4.37 19.93
Hero MotoCorp Limited (BSE:500182) 31-Dec-23 4,908.50 981,315.90 952,804.20 869,519.60 153,223.20 47,376.80 654,328.00 156,479.00 1.10 6.22 4.56 3.42
###

Mean 4.5x 7.6x 2.6x 9.7x

Median 1.5x 4.8x 1.9x 8.9x
High 17.2x 21.0x 4.6x 19.9x
Low 0.6x 2.2x 0.9x 3.4x

Valuation
Target Co (TVS Motors) 31,974.00 4,655.00 3,796.00 40,926.72 3,760.81
EV/Sales EV/EBITDA EV/Sales EV/EBITDA
Mean (EV) 124,972.76 143,529.63 35,523.71 106,415.89 36,609.19
Plus: Cash 1,879.00
Less: Debt 21,626.00
Equity Value 105,225.76
Equity Value/Share 2,214.81

John Colley
Market Data and Price 33 Jonathan Swan
 TVS Motors Valuation

Methods
DCF method (FCFF)
GPC method
Final Fair Value of Enterprise Value
Plus: Cash
Less: Debt
Equity Value
Shares Outstanding

Equity Value/Share

Current Price

Target Price Upside

TVS Motors Valuation

Enterprise
value (in cr) Weightage
119,413 50% 59,706
124,973 50% 62,486
100% 122,193
1,879
21,626
102,446
47.51

2156.30

2,146.25

0%
Comps
Metric Comps EV Net Debt Equity Value Shares Share Price Key Assumptions - Valuation Co. Inc.
EV/Revenue (LTM) 4.5x 143,530 19,747 123,783 48 2,605.40 Current Price 2,146.25 Revenue (LTM) 31,974
EV/EBITDA (LTM) 7.6x 35,524 19,747 15,777 48 332.07 Shares Outstanding 48 EBITDA (LTM) 4,655
EV/Revenue (FY1) 2.6x 106,416 19,747 86,669 48 1,824.22 Debt 21,626 Revenue (FY1) 40,927
EV/EBITDA (FY1) 9.7x 36,609 19,747 16,862 48 354.92 Cash 1,879 EBITDA (FY1) 3,761

Lo 354.92
Hi 2,605.40

Football Field Data

lo (bar) lo (label) hi (bar) hi (label)
Comps 354.92 354.92 2,605.40 2,605.40
DCF 2,060.86 2,060.86 2,510.45 2,510.45
52 wk hi/lo 1,005.00 1,005.00 2,313.45 2,313.45

Valuation Summary

Valuation Summary - Equity Value per Share (rs)

2,600.00

2,100.00 2146

1,600.00

1,100.00

600.00

100.00
Comps DCF 52 wk hi/lo

FINDINGS
1.TVS Motor Company's revenue from operations in
the quarter ended March 2023 grew by 19% at Rs.
6,605 Crores against Rs. 5,530 Crores in the quarter
ended March 2022.
2.Tvs Motor Company has reported a 68 per cent rise
in its net profit at ₹593 crore in the December 2023
quarter.
3 It aims to take its exports share to 50 per cent in the
next few years.
Recommendation
MARKET ANALYSIS
1.TVS Motor Company – The third larg
manufacturer in India.
2.TVS Motor Company Ltd. share price
from its previous close of ₹2,067.10. L
₹2,016.35.
3.The initial price target for TVS Moto
projected to be ₹2567.17. With favora
the mid-year price target for TVS Mot
reach ₹2552.96.
mmendations
ALYSIS
ompany – The third largest two-wheeler
in India.
ompany Ltd. share price moved down by -2.46%
ous close of ₹2,067.10. Last traded price is
ice target for TVS Motor Company Ltd in 2025 is
e ₹2567.17. With favorable market conditions,
price target for TVS Motor Company Ltd could
6.
INTERPRETATIONS
1.I would recommend to buy the TVs motors stocks as
maintained its 'Buy' rating on TVS Motor with a revised
price of ₹1,840 from ₹1,510 earlier. Even Nuvama said
has been gaining domestic share. Market share has gro
14% in FY18 to 16% in FY23.
2.There are 34 analysts who have initiated coverage on
Motor Co. There are 9 analysts who have given it a stro
rating & 7 analysts have given it a buy rating. 1 analysts
given the stock a sell rating. The company posted a net
478.75 Crores in its last quarter.
he TVs motors stocks as its has
VS Motor with a revised target
rlier. Even Nuvama said that TVS
re. Market share has grown from
ve initiated coverage on TVS
who have given it a strong buy
t a buy rating. 1 analysts have
e company posted a net profit of
r.