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News: Standalone operating income for Q3FY24 came in at ₹ 9,273 crore, up 2.7% YoY amid 1% de-growth in volumes to 47,241 units and share of M&HCV in total volume mix at 62.4% vs. 64.4% in Q2FY24. EBITDA came in at ₹ 1114 crore with margins at 12%, up 80 bps QoQ. Consequent PAT in Q3FY24 came in at ₹ 580 crore (up 61% YoY, 3% QoQ).
Views: Net realisation for the quarter came in higher than anticipated at ₹19.6 lakh/unit (up 1.5% QoQ). Gross margins expanded 130 bps on QoQ basis, the gains however limited by higher other overhead expenses. The company in the recent past has won impressive orders on the Bus segment for both ICE & EV buses and now trades at reasonable valuation of ~9x EV/EBITDA on FY26E with 25% return ratios profile. The industry outlook has however turned marginal negative with other industry participants suggesting YoY volume decline H1CY24. We await management commentary on volume growth with YTD FY24 volumes at 1.54 lakh units, up 3.1% YoY. Given the robust results we expect the stock to open positive in opening trade today.
Impact: Positive