CLSA has retained an underperform rating on the stock with a target price of Rs 1,280. The research firm sees launch of two SUVs over the next two years. Meanwhile, it also senses that the electric vehicle development business will become a bigger part of the company’s strategy.
The research firm highlighted the company’s aim to increase market share in non-tractors and overseas business. It foresaw the farm equipment division business attaining USD 5 billion revenue mark.
Credit Suisse has maintained a neutral call on the stock with an unchanged target price of Rs 1,390. It believes that the auto sector faces challenges with changes on emissions, powertrains and connectivity. Going forward, the company has planned a dual strategy on electric vehicles with focus on mass models on commercial side.
The research firm sees an early mover advantage for the firm in the electric vehicles segment. In the farm segment, Credit Suisse foresees market share in farm equipments and highlighted that it was looking to provide end to end solutions in agriculture business.
Meanwhile, Bank of America Merrill Lynch has highlighted the company’s target to increase share of implements to 20 percent by FY19. It also stated that the automobile major was targeting 50 percent revenue from outside India against 37 percent in FY17.
Financials
Credit Suisse has highlighted that delinquencies for microfinance institutions (MFIs) will move up further to over 10 percent against 7.5 percent in December and has no signs of recovery. While disbursements by MFIs have picked up, it is yet to reflect in collections, it said. Based on this, it sees a heightened risk for banks with large MFI exposure.
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