Feb 14, 2017 06:12 PM IST | Source: Moneycontrol.com
Accumulate Igarashi Motors; target of Rs 875: Systematix
Systematix has recommended accumulate rating on Igarashi Motors India with a target price of Rs 875 in its research report dated February 09, 2017.
Systematix's research report on Igarashi Motors India
Igarashi Motors (IGM) reported strong 3QFY17 results, with revenue slightly below our estimate, but EBITDA was 150bps higher than our estimate. PAT was lower than our estimate due to a higher depreciation related to a new manufacturing line and accounting change. Revenue increased 18% yoy to Rs1.2bn, driven by 17% volume growth and partly impacted by a shutdown due to cyclone and chief minister’s death.
We expect CY17 to be a moderate growth year, with 15% volume growth and growth acceleration to start from CY18 on new capacity and orders. We estimate motor volume and profitability to grow >=2x in the next four years, with upcoming programs and application diversification. We maintain a positive stance, with an Accumulate rating and a target price of Rs 875.
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