ICICI Securities, through its ICICI Direct retail research desk, has reaffirmed its BUY rating on Tata Motors Commercial Vehicles after a second quarter that married brisk volume growth with disciplined pricing. Analysts Shashank Kanodia and Bhavish Doshi value the stock at Rs 515 on a sum-of-the-parts basis, a level that sits marginally above the 52-week high of Rs 509 and roughly 29% above the current price of Rs 400.

The Tata group's commercial vehicle arm, the country's largest truck and bus maker by share, commands a market capitalisation of about Rs 1,47,200 crore and an enterprise value of roughly Rs 1,38,967 crore, thanks to a net-cash balance sheet.

The quarter on the weighbridge

Consolidated revenue climbed 36.3% YoY to Rs 25,338 crore, and rose 22.6% sequentially. EBITDA advanced 22.9% to Rs 2,770 crore, but the margin slipped 119 bps YoY to 10.9% as raw material costs grew faster than sales. Reported profit came in at Rs 1,257 crore, against a loss of Rs 867 crore a year earlier that was weighed down by a one-time exceptional charge.

Every segment in the convoy accelerated

Wholesales rose 42% YoY and 24% QoQ to 1,35,100 units, with double-digit growth everywhere. Management credited better fleet utilisation, firmer freight rates, resilient replacement demand and infrastructure spending. The trailer lengths below are drawn to scale against YoY growth.

Market share: three lanes gained, one ceded

On Vahan registration data, TMCV's H1FY27 domestic share rose 110 bps over FY26 to 36.2%. Buses delivered the standout gain of 500 bps, while heavy trucks stayed comfortably above half the market. The one soft lane, intermediate and light trucks, slipped, a detail the brokerage's commentary passes over.

Paying the toll on steel and rubber

Management put the commodity hit at about 540 bps YoY, with a further 200 bps between the first and second quarters. Steel touched a 52-week high and rubber stayed elevated amid tight supply and costlier synthetics. Another 150 to 200 bps of pressure is expected in the third quarter. TMCV has answered with four price increases this year:

By TopNews arithmetic, the hikes add up to roughly 6.5% to 7.5%, and they have absorbed much of the blow. Raw materials consumed 69.9% of revenue in the quarter, up from 67.3% a year earlier, a net erosion of about 260 bps against the gross 540 bps cited by management.

Beyond the domestic cycle: exports and electrics

International volumes surged 177% YoY, helped also by steadier demand in sub-Saharan Africa, Nepal and Sri Lanka. Management describes exports as margin-accretive, though the Indonesia order's tilt toward light and smaller vehicles dilutes average selling prices. Aftermarket, digital fleet services and other non-cyclical lines now contribute about 20% of revenue, a useful shock absorber when the truck cycle cools.

The estimates ICICI Securities is working with

The model assumes industry growth cools to high single digits in the third quarter on a demanding base. Over FY26 to FY29E, ICICI Securities projects revenue compounding at 12.1%, EBITDA at 8.2% and net profit at 46.3%, the last flattered by FY26's exceptional charge. Debt is expected to shrink from Rs 4,817 crore to just Rs 417 crore by FY29E.

How the Rs 515 target is hitched together

The brokerage applies 12x FY28E EV/EBITDA to the India CV business, 2x book to long-term investments including the Tata Capital stake, and adds projected FY28 net cash. Each trailer below is sized to its share of the Rs 1,89,435 crore equity value spread over 368 crore shares.

The split carries a telling message: the core truck franchise alone is worth roughly what the whole stock fetches today, so investors are effectively being handed the cash pile and investments at no cost. At the current price the stock trades on 17.4x FY28E earnings and 10.0x FY28E EV/EBITDA, below the multiple the brokerage applies.

Warning lights on the dashboard

Levels at a glance: TMCV · BUY (ICICI Securities) · CMP Rs 400 · Target Rs 515 · Upside ~29% · 12 months · 52-wk Rs 306–509 · SoTP, 12x FY28E EV/EBITDA