Seems like Tata Motors (TTM) has emerged as a clear frontrunner in the ongoing bid for Land Rover and Jaguar. 

Great must-read article over at Knowledge @ Wharton: 

Tiger by the Tail: The Tatas Are Closing In on Jaguar and Land Rover

Disclosure:  None

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• March 2007: 11%
• February 2007:  19%
• January 2007: 19%
• December 2006:  37%
• November 2006: 43.1%
• October 2006:  5.6%
• September 2006:  23.8%
• August 2006:  26.2%

Key highlights from the month of March:

• 11% YoY growth to 62,779 units
• Passenger vehicle sales of 25,760 units was highest of any month ever. 
• Sales of Utility vehicles was also the highest of any month ever. 
• Exports declined 33 per cent at 6,299. 
• Commercial vehicle sales grew by 13% YoY.

* I have no position in Tata Motors (TTM)

Source:  Economic Times (Warning: Lot’s of ads and pop-ups)

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Let’s look at the performance of Indian stocks from last week:

The thing is that you can expect the Sensex to go down just as swiftly as it went up last week. 

The stocks and Funds I am targeting for now are:   

• ICICI Bank (NYSE: IBN)
• HDFC Bank (NYSE: HDB)
• Indian Fund (NYSE: IFN)
• MS India Fund (NYSE: IIF)
• IPATH ETNS (NYSE: INP)

I also like:

• Tata Motors (NYSE: TTM)
• Infosys (NYSE: INFY)

I consider all of above mentioned companies to be blue chip stocks and would love to invest in them for the long term. 

I am definitely going to keep an eye on both the Indian banks IBN and HDB and also INP which is an ETF. 

* I don’t own any of the stocks mentioned above. 

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Also, the latest news coming from the Geneva Auto show is that Tata Motors is planning to make hybrid cars.  The company is currently in talks with Ballard Power Systems (Nasdaq: BLDP) which makes Fuel Cells. 

The company also showed of Tata Elegante at the Geneva Auto Show. 

Tata Motors (NYSE: TTM) sales numbers for the month of February: 

• Total Vehicle sales were 53,707 – 19% YoY
• Commercial vehicles:  27,859 – 22% YoY
• Passenger vehicles:  21,322 – 19% YoY
• Exports grew by only 6% YoY to 4,526 vehicles

The February numbers don’t look great as far as the growth is concerned but this stock remains very intriguing at this point.  It’s currently trading at about $17.50 and might have more downside if the weakness in the Indian financial markets continue to push Indian ADR’s down.  It’s a good company in a booming auto market with a 1.6% dividend a low P/E.  I am keeping an eye on this to possibly start a position in the near future. 

* I have no positions in TTM or BLDP

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Tata Motors (NYSE: TTM) seems to have recovered strongly after posting bad monthly growth figures in the months of August, September and October of 2006.  The auto manufacturer has posted nice back to back months of November and December of 2006. 

Key Highlights from December 2006:

• Vehicle sales up 37% YoY
• Passenger sales up 27% YoY
• Commercial sales up 50% YoY
• Exports grew 7%

Total YoY sales growth in the past few months:

• December 2006: 37%
• November 2006: 43.1%
• October 2006 – 5.6%
• September 2006 – 23.8%
• August 2006 – 26.2%

The stock is currently trading very close to its 52-week high. 

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Tata Motors (NYSE: TTM) recovered with strong sales number for the month of November. Vehicle sales in November were up 43.1% YoY. This comes after disappointing growth the last few months:

• November 2006: 43.1%
• October 2006 – 5.6%
• September 2006 – 23.8%
• August 2006 – 26.2%

Key Highlights:

• Total sales of 49,061 vehicles – 43.1 YoY
• Commercial Vehicle sales grew 45.8% YoY
• Passenger vehicle sales grew 48.4% YoY
• Exports, however, grew by only 9.6% YoY

The market reacted positively to the news on Friday as the stock closed the day up 4.65%.

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Financial Express:  October sales figures are out for Tata Motors (NYSE: TTM) and they are not very good. 

• Vehicle sales rose only 5.6% YoY
• Sales of commercial vehicles (Tata Motors primary business) grew by 18.5% YoY.
• Sales of passenger vehicles declined 2.8% YoY.
• Exports fell 22% YoY

As I reported earlier, margin pressures hurt Tata Motors in the previous quarter due to higher raw material prices and higher interest rates. 

Lets look at the sales volume growth for the last few months:

• October 2006 – 5.6%
• September 2006 – 23.8%
• August 2006 – 26.2%
• July 2006 – 44.5%

As you can see by these figures the sales growth has consistently declined the last few months but October numbers seem really low. 

Tata Motors will keep seeing increased competition in the booming Indian auto sector not only from foreign automakers but domestic as well.  I still like this company long term but not at these levels, specially with the Indian markets at an all time high.

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Domain-b and Yahoo: Tata Motors (NYSE: TTM) was under pressure today as company reported results for quarter ending September 30th, 2006.  The stock closed the day down about 4% as the company reported deteriorating operating margins.  Operating margins as a percentage of net sales declined to 11.97% from 12.54% a year ago.  The company blamed the margin pressure on higher raw material costs such as steel and rising interest rates.  However, two of Tata Motors biggest competitors Mahindra and Mahindra (M&M) and Maruti both reported higher margins at 13.22% and 13.9% respectively. 

I reported earlier about slowing growth in September sales numbers and pressure on margins, so this wasn’t totally unexpected. 

Input costs went up by 40.85% while employee costs increased by a 55.56% and other operating expenses were higher by 46.14% YoY. 

The overall numbers, however, didn’t look bad:

• Net profit up 36% YoY to $98 million.
• Net sales were up 37% YoY to $1.46 billion.
• Exports grew by 18% YoY
• Market share in commercial vehicles grew from 58% to 65%
• Passenger vehicle market share barely grew from 15.8% to 16.3% 

Bottomline:  We in the United States only have a handful of Indian ADR’s to choose from and Tata Motors remains one of the best out there.  However, it’s the only one in its sector listed in the US.  There is a choice in Banks, IT, Internet, Telecom but not automobile sector among the listed ADR’s and the auto sector is booming like everything else in India.  I am going to keep an eye on this and might buy if it goes under $15.

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domain-B:  Tata Motors (NYSE: TTM) reported sales volume growth of 23.8% in the month of September.  This growth is almost half compared to July’s growth rate of 44.5% and slightly less then 26.2% for the month of August.  Apparently, passenger car sales were affected by a fire in the paint shop at its Pune plant.  They are expecting this to affect October sales figure as well.  Overall, not a very encouraging month for the company. 

Highlights:

• Total sales for the month of September 2006 were 49,157 units (including exports) compared to 39,707 units in the same month last year. 
• Passenger car sales in the domestic market were at 18,609 units, an increase of 15.7% YoY
• Commercial Vehicles sold in the domestic market stood at 26,627 units, an increase of 39.5% YoY. 
• The Company’s sales from exports were 3,921 units, a decrease of 14% YoY. 

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MoneyControl

• Total vehicle sales at 45.681 (26.2% YoY)
• Commerical vehicle sales up 35% YoY at 23,069. 
• Passenger vehicle sales totalled 17,451 (26.4% YoY)
• Indigo model sales declined 31.5% YoY.
• Sales of Safari highest of any month at 1305.
• Exports declined 3.5% YoY to just 5071 vehicles.

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