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revenue came from operations outside of India. It witnessed strong growth of 24% in revenue from China, compared with 18% in the previous year, on the back of strong JLR sales. The division was responsible for nearly 88% of the company’s operating profit in the fiscal. The latest data shows that even in 2013, China contributed the bulk of JLR sales, which grew 15.4% y-o-y for the first eight months.
While experts remain upbeat on the prospects of the JLR business, some have started questioning further upside for the stock given a sharp rally of about 27% in the last three months.
Recently, Kotak Institutional Equities downgraded the stock to ‘add’ from ‘buy’ citing its fair valuation. The brokerage, which also raised its target price on the stock from R355 to R375, however, acknowledged that JLR’s operating profit is likely to benefit from a rich product mix and positive operating leverage.