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Jaguar Land Rover: Risks Unappreciated. Valuation Highly Sensitive. Sell Senior Unsecured Bonds.

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    Company Profile

  • 143 Pages
  • July 2019
  • Everest Research Group
  • ID: 5131095
Why Read?

  • Understand potential external scenarios and impact for Jaguar Land Rover (JLR) - no-deal Brexit, US tariffs
  • Understand valuation of JLR (including inference from recent impairment charge) and its key sensitivities
  • Understand JLR’s cost structure and degree of operating leverage vs competitors
  • Understand JLR’s competitive positioning by nameplate and potential financial impact of new nameplates
  • Understand JLR’s liquidity and where the major liquidity pressure points are likely to arise in time
  • Understand recovery rate potential

What’s New?

  • Valuation-based quantification of high (equity-like) risks facing senior unsecured bondholders
  • Unit sales projections for key marques based on geographic mix and share of premium car market and run in / run out pattern of prior marque updates as well as new nameplates

Questions Answered

  • How has JLR’s share of the premium market developed since coming to the High Yield market?
  • What key drivers will deliver the sales, earnings and free cash flow growth needed to get JLR through a challenging period?
  • How well is JLR positioned competitively?
  • How does JLR’s cost base compare to peers?
  • How can we model the impact of a no-deal Brexit or US tariffs?
  • What do Q3 2019 impairment charge disclosures tell us about valuations?
  • Why is JLR’s enterprise value so sensitive to assumption changes?
  • What is the extent of potential priming and how does it impact recovery rate?

Table of Contents

  • View, Variant Perception & Recommendations
  • Q2 & Q3 20 Results Analysis
  • Updated Financial Projections
  • Updated Valuation & Sensitivity Analysis

Appendices:
  • Projecting Revenue
  • Gross Merchandise Margin Definition

Companies Mentioned

  • Jaguar Land Rover
  • Volvo
  • VW
  • Aston Martin
  • Porsche
  • BMW
  • Tesla