Valuations factor in strong earnings growth, better margins for TVS Motor

TVS Motor met expectations in terms of revenue and posted a strong margin performance in Q1FY25.  The key drivers were material cost savings and a better mix. The domestic demand outlook looks good with a rural rebound but geopolitical uncertainties in key export markets may dent overall growth. Bangladesh, for example, is in turmoil.  

The strong earnings growth and margin improvement are reflected in the current valuation of 44 times price to price-to-earnings ratio on FY25 earnings. But analysts are upgrading earnings expectations to factor in better margins and higher other income.

TVS’s revenue grew 16 per