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Buy Amara Raja Batteries; target of Rs 1146: Sharekhan

Sharekhan is bullish on Amara Raja Batteries has recommended buy rating on the stock with a target price of Rs 1146 in its research report dated February 12, 2021.

February 16, 2021 / 07:48 PM IST
 
 
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Sharekhan's research report on Amara Raja Batteries


Q3FY21 revenues broadly in-line with our estimates but misses on EBITDA margin. Amara well-positioned to gain market share in lead acid battery business by adding clients and widening replacement distribution network. EBITDA margins to remain firm, driven by favourable product mix, led by a higher share of revenues from replacement segment, operating leverage benefits and cost-cutting measures. The stock trading below its historical average multiples at P/E multiple of 19.6x and EV/EBITDA multiple of 10.0x its FY2023 estimates.


Outlook


We maintain our Buy rating on Amara Raja Batteries (Amara) with a revised PT of Rs. 1,146, owing to a improving batteries demand outlook for automotive and industrial segments (telecom and UPS).


For all recommendations report, click here


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first published: Feb 16, 2021 07:48 pm

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