[ad_1]
With a market capitalization of ₹95,042.27, Eicher Motors Ltd. is a blue-chip company that operates in the consumer discretionary sector. The cornerstone company of the Eicher Group in India and a popular choice in the country’s automotive market is Eicher Motors Limited. The closing price per share for Eicher Motors Ltd. was ₹3,473.00 on Friday, up 1.38% from the previous close of ₹3,425.75. The stock’s 52-week high was ₹3,513.70 reached on August 25, 2022, and its 52-week low was ₹2,159.55 touched on March 8, 2022; at the last traded price it was seen trading 60.82% above the low. The stock’s target price has been set at ₹4,170 by research analysts Shashank Kanodia and Raghvendra Goyal of the brokerage firm ICICI Securities, with a 12-month target period. This suggests that the stock is on track to reach new 52-week highs in that time frame.
They have said in their research note that “Eicher Motors (EML) has recently launched Hunter 350 at an ex-showroom price of ₹1.5 lakh/unit. Domestically, with Hunter 350, EML wants to tap the first time buyers and upgrades from the 100 cc+ segment and sees >125 cc segment as its addressable market with market size pegged at ~32 lakh units (sales in FY22 at 5.2 lakh units). Internationally, the addressable market size is pegged at ~10 lakh units (sales in FY22 at 80,000 units).”
“RE’s recent volume prints were encouraging with total volumes in August 2022 pegged at 70,000 units, up 26% MoM, vastly outperforming its peers. Continued focus on Rebalance strategy wherein it will focus on all aspects of growth including EV development, superior product offering & increasing revenue from non-auto business (mainly accessories & spares),” the research analysts of ICICI Securities cited as key highlights for the stock.
The research analysts Shashank Kanodia and Raghvendra Goyal of the brokerage firm ICICI Securities added that healthy response to Hunter 350 and intent to shift consumer preference to more superior offerings. We expect RE volumes to grow at a CAGR of 25% over FY22-24E. CV volumes are expected to grow at a CAGR of 22% and steady improvement in motorcycle production amid diversified product offering and increasing market share in international market to bring in operating leverage benefits with margins seen reaching 26.1% in FY24E, are the key triggers for future price actions of the stock.
They have further claimed that “EML’s stock price has grown at ~2% CAGR in last five years from ₹3,200 in September 2017, underperforming broader Nifty Auto index. We maintain BUY amid healthy volume growth prospects over FY22-24E. Upgrading our numbers, we now value EML at ₹4,170 on SOTP basis; assigning 34x PE to RE business & 30x PE to VECV business on FY24E.”
Cannibalisation of premium offerings amid new budgeted offering, (ii) Lower than anticipated volume growth limiting operating leverage benefits in FY22-24E, they cited as the key risks for the stock for its future performance.
Eicher Motors‘ stock price soared from ₹1.22 on January 1st, 1999, to the current market price, representing a multibagger return and an all-time high of 284,572.13%. The company reported a 49.21% promoter shareholding for the quarter that ended June 2022.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
Download The Mint News App to get Daily Market Updates.
[ad_2]
(This story has not been checked by Kashmir Bulletin and is auto-generated from other sources)
Source link
