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Last Updated : Jun 13, 2019 04:16 PM IST | Source: Moneycontrol.com

Buy JBM Auto; target of Rs 390: Dolat Capital

Dolat Capital is bullish on JBM Auto has recommended buy rating on the stock with a target price of Rs 390 in its research report dated May 31, 2019.

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Dolat Capital's research report on JBM Auto


JBM Auto (JBMA)’s results were better than estimates in 4QFY19 (revenue +8%, PAT+13% YoY), despite challenging environment in the PV segment, due to a strong revival in the bus business and a robust growth in the tooling business. We are positive on the stock based on 1) new order wins in the sheet metal business, from M&M, Tata Motors, and VECV; 2) encouraging revenue potential in the tooling business (high margin +30%), given rising localization and outsourcing of tooling requirements by large global OEMs (cost-benefit of 25% in India); and 3) increasing economies of scale in the bus business, which should aid profitability in the future. We forecast a 23% EPS CAGR over FY19-21E. The stock is currently available at 10/8x for FY20/21E.


Outlook


We recommend Buy rating on the stock, with a TP ` 390 (15x 21E EPS).


For all recommendations report, click here


Disclaimer: 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 on Jun 13, 2019 04:16 pm
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