Moneycontrol
Feb 08, 2018 05:44 PM IST | Source: Moneycontrol.com

Buy Bajaj Auto; target of Rs 3641: LKP Research

LKP Research is bullish on Bajaj Auto has recommended buy rating on the stock with a target price of Rs 3641 in its research report dated February 05, 2017.

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LKP Research's research report on Bajaj Auto


Bajaj Auto posted better than expected numbers at the topline as 17.6% yoy growth in volumes and 1% rise in realisations led to an 18.7% growth at the top line. This was on the back of low base of last year and recovery in the exports markets. Although domestic volumes declined 6.5% YTD, exports volumes grew by 11.3% YTD on strong surge in markets like Nigeria, ASEAN countries and other African markets.  Margins came in at 19.7% as RM prices grew yoy as metal prices and other expenses grew on higher CSR expenses at ₹400 mn. Lower other income and higher tax rate at 31.1% with lower benefits from PN plant led to net profits slightly lower than street expectations at ₹9.52 bn which was 14% lower yoy.

Outlook
We maintain BUY rating on the stock with a rolled over target price of ₹3, 641 on FY20E, more or less maintaining our FY18E and FY19E estimates.

For all recommendations report, click here


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