Motilal Oswal Securities has maintained 'Buy' on TVS Motor Company with target price of Rs 120 as against current market price (CMP) of Rs 87 in its report.

Commenting on the investment rationale, the stock broker said, ''TVS is well positioned to benefit from the scooterization wave in India. Over the next 12-18 months, it plans to launch multiple products across segments to reinforce and fill gaps in its product portfolio.

We expect EPS to grow at a CAGR of 34% and FCF to grow at a CAGR of 25% over FY14-16, with RoE improving from 19.9% to 25.5%. We expect TVSL to be a net cash company by FY16, driven by strong FCF.

Sustained strength of the Scooter industry and TVSL's market share gains, coupled with initial signs of recovery in the South, increase our confidence in TVSL's ability to deliver strong volume-led earnings growth. We now value TVSL at 12x (v/s 10x earlier) FY16E EPS of Rs 10. Maintain Buy, with a target price of Rs 120.''

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