Buy Ashok Leyland: Target Of Rs 98: Sharekhan
Sharekhan is bullish on Ashok Leyland recommended buy rating on the stock with a target price of Rs 98 in its research report dated November 09, 2020.
Nov 11, 2020 / 11:26 AM IST
Sharekhan's research repor on Ashok Leyland
Ashok Leyland Limited’s (ALL) Q2FY2021 operating results were above estimates driven by better than expected realisations. ALL expects recovery in CV demand to continue with growth anticipated in Q3FY21 and Q4FY21 as Government opens economy under Unlock measures. We expect strong recovery from FY2022, driven by normalisation of economic activity. Moreover, ALL is focusing on enhancing CV exports and increasing revenue from the aftermarket and defence segments to reduce dependence on cyclical domestic CV business.
We have broadly retained our earnings estimates. EV/EBIDTA of 9x FY23 EV/EBIDTA is lower than historical average of 12x. We retain our Buy rating on the stock with unchanged PT of Rs 98.
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