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    HomeNewsBusinessStocksBuy Amara Raja; target of Rs 1087: Motilal Oswal

    Buy Amara Raja; target of Rs 1087: Motilal Oswal

    Motilal Oswal is bullish on Amara Raja has recommended buy rating on the stock with a target price of Rs 1087 in its research report dated January 23, 2017.

    January 24, 2017 / 15:20 IST

    Motilal Oswal's report on Amara Raja

    EBITDA margin declined 170bp QoQ (and 360bp YoY) to 15.4% (v/s our estimate of 16.5%) due to higher employee and other expenses, despite in-line gross margin. RM cost increased 80bp QoQ (and 330bp YoY) due to increase in lead prices, despite increase in prices by 3% in November and 4% in December in the replacement market.

    Outlook

    We have cut our EPS estimates by 1.5-2.7% to factor in stronger than estimated revenue growth and higher costs (RM and fixed costs). The stock trades at 23.9x/19.9x FY18/19E EPS. Maintain Buy with a target price of INR 1,087 (25x December 2018E EPS).

    For all recommendations, click hereDisclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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    first published: Jan 24, 2017 03:20 pm

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