Buy Munjal Showa, says Aashish Tater

Buy Munjal Showa, says Aashish Tater, Head of Research, Fort Share Broking.

Tater told CNBC-TV18, "Munjal Showa was one stock which was our pick of safe bet list this year and this is continued pick from my side. We recommended this stock even at Rs 50-52 levels and even at the current level the stock downside is capped."

He further added, "It has three plants one at Manesar, Gurgoan and another one in Haridwar, all these three plants are capable enough to meet its current demand. The management pointed out that they would slowly expand the capacity of 6-7% YoY from next year. For this particular fiscal we expect a 25% jump in terms of topline and similar result could be seen in terms of net profit margin also. The margins have actually stabilized and for Q1 itself the company has done Rs 3.95 EPS."

"Hero Honda Group has splitted into Hero Corp and Honda and Hero Corp has pointed out that they would be targeting aggressive sales even going forward with new models coming in. Shock absorbers have to be apart and given the parentage is Munjal