Landmark Cars rallies to six-month high on record Q1 revenue

Landmark Cars shares jumped 17.5% to a six-month high after the Indian auto retailer reported record revenue for the June quarter. The sharp rally extends a broader recovery for the stock, which gained 15.4% in June and has added another 10.2% so far in July.

Total operating revenue rose 22.47% year-on-year to ₹1,733 crore, driven by broad-based growth across its business lines. Vehicle sales, which include pre-owned transactions, increased 24.15% to ₹1,465 crore. After-sales services, spare parts, and other revenue streams grew 14.04% to ₹268 crore.

A key structural shift underpinning the latest figures is Landmark Cars' participation in Mercedes-Benz's agency model. Under this arrangement, customers place orders directly with Mercedes-Benz India, while Landmark Cars earns a commission on vehicles facilitated through its network. This model alters the retailer's revenue recognition and changes the capital requirements associated with holding vehicle inventory.

The operational momentum is expected to continue as major manufacturers roll out new products. The company began delivering the Mercedes-Benz CLA, MG Majestor, and the new Renault Duster during the quarter. A pipeline of additional launches from Mercedes-Benz, BYD, MG, Mahindra & Mahindra, Honda, and Kia is scheduled for the coming months.

Supply chain normalization, particularly for electric vehicles, is also providing a tailwind. Landmark Cars noted that BYD vehicle supply improved during the first quarter and is anticipated to strengthen further in the current period. This resolution of previous bottlenecks positions the retailer to capture rising EV demand in the Indian market.

For investors, the quarterly results suggest the company is successfully navigating a transition period that had previously weighed on its valuation. The stock has returned to positive territory for the year, reversing a streak of negative annual returns over the past three calendar years.

Despite the recent optimism, the current share price reflects a market that remains cautious about the sustainability of this recovery. Even after the two-month rally, the stock sits 27% below its recent peak of ₹662 and trades 47.3% below its all-time high of ₹905. Having fallen to an all-time low of ₹329 during a prolonged correction, Landmark Cars must prove that the improved sales trajectory can translate into consistent earnings growth to close that valuation gap.