Buy Bajaj Auto; Target Of Rs 3500: Sharekhan
Sharekhan is bullish on Bajaj Auto has recommended buy rating on the stock with a target price of Rs 3500 in its research report dated October 22, 2020.
Oct 27, 2020 / 04:01 PM IST
Sharekhan's research repor on Bajaj Auto
Q2FY21 operating results were ahead of estimates as margins improved on a y-o-y basis despite a fall in the topline. Cost control measures and better forex realisations boosted margins. Bajaj is expected to continue gaining market share in exports (driven by enhanced distribution network) and domestic market (driven by a premiumization trend and new launches). Price hikes, better mix and cost control measures to offset increase in input costs. Margins to remain at 17-18% level. Valuations at 14.8x FY23 earnings are lower than long term historical average.
We maintain Buy rating on Bajaj Auto (Bajaj) with unchanged PT of Rs 3,500. Demand is improving in both domestic as well as export markets.
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