Buy Craftsman Automation; target of Rs 7900: ICICI Securities

ICICI Securities's research report on Craftsman Automation

Craftsman Automation’s (CFTM) consolidated revenue grew 65% YoY to INR 20bn, 10% higher vs. I-Sec est. EBITDA margin of 15.1% in Q2FY26 (up 20bps QoQ), was largely in line with I-Sec est. of 15.0%. Margin expansion was led by operating leverage and cost optimisation. We expect CFTM’s EBITDAM to expand by 200bps over FY25-28E with a ramp-up in operations at its new plants and a gradual improvement in profitability at Sunbeam. We expect revenue to
increase by ~15%/12% for FY27/28E led by steady growth from existing businesses, supported by an increase in share of business from existing and new customers, and revenue addition from Sunbeam, Fronberg acquisitions.

Outlook

Maintain BUY with a revised TP of INR 7,900 (vs. INR 7,800), based on 30x Sep‘28E EPS.