Buy Gulf Oil Lubricants; target of Rs 760: HDFC Securities

HDFC Securities' research report on Gulf Oil Lubricants

We reiterate our BUY rating on Gulf Oil as demand outlook has improved across segments, including the DEO segment. While 1Q volumes were weak (- 40% YoY, -30% QoQ), management is witnessing encouraging recovery signs, led by the Agri and MCO segments. The company is expected to benefit from the shift towards personal mobility. The nascent battery business is scaling up and has witnessed growth in Jun-20 (albeit on a low base). Maintain BUY.

Outlook

Our estimates are largely unchanged. We reiterate BUY with a target price of Rs 760 @ 20x Jun-22 EPS.