Buy Endurance Technologies; target of Rs 1085: HDFC Securities

HDFC Securities' research report on Endurance Technologies

While Endurance reported a weak 1Q, the auto parts maker RFQs have risen to Rs 15.4bn in 1QFY21 (up from Rs 12.8bn QoQ). With the recent acquisition of its Italian technology partners Grimeca and Adler, the company is further expanding its presence with customers. It is winning new orders from new customers (TVS Motors), and the management expects to increase its wallet share by cross-selling products to OEMs. Endurance has raised FY21E Capex guidance to Rs 2bn (from 1.5bn earlier).

Outlook

The stock is amongst our preferred pick in the autos/auto parts sector as the company is well-positioned to benefit from a demand recovery over FY22/23E. Maintain BUY.

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