Motilal Oswal's research report on Tube Investments of India
Tube Investments of India (TIINDIA)’s 4QFY24 result was operationally weak, as margin came in at 11.1% (v/s est. 12.7%), mainly due to higher other expenses and rising competition in its metal-formed business on the railway side. TIINDIA has further outlined a capex of INR4.7b for TICMPL, expecting these businesses to be the future growth drivers despite a delay in ramp-up. We cut our FY25E/FY26E consolidated EPS by ~8/7%% to factor in margin pressure in the metal-formed business. We value its EV vertical (ex- SCV) at INR350 per share in the SoTP after assigning a value to its e-HCV business. The stock trades at 60x/49x FY25E/FY26E consol. EPS.
Outlook
We reiterate our BUY rating with a TP of ~INR4,400 (premised on Mar’26 SoTP).
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