Sharekhan's research report on Sundram Fasteners
SFL is well positioned to benefit from technology shift from BS-VI to electric vehicles (EVs), especially in emission-control products. Moreover, the company has capabilities to benefit from technological trends shifting towards lightweight and high strength products. We expect SFL’s earnings CAGR to improve by 38% during FY2022-FY2024E, driven by a 21.5% revenue CAGR and a 160 bps improvement in EBITDA margin to 17.9% in FY2024E from 16.3% in FY2022, with ROCE progressing to 24% in FY2024E. The stock is trading below its historical valuations at P/E multiple of 17.2x and EV/EBITDA multiple of 10.8x its FY2024E estimates.
We retain a Buy rating on Sundram Fasteners Limited (SFL) with a unchanged PT of Rs. 1,030, led by the company’s strong performance outpacing the automobile industry’s growth through diversifying client and product portfolios, benefiting from its established client relationships and prudent capital allocation.
At 13:41 hrs Sundram Fasteners was quoting at Rs 730.00, up Rs 7.05, or 0.98 percent.
It has touched an intraday high of Rs 739.10 and an intraday low of Rs 713.55.
It was trading with volumes of 2,421 shares, compared to its thirty day average of shares, a decrease of percent.
In the previous trading session, the share closed up 1.57 percent or Rs 11.20 at Rs 722.95.
The share touched its 52-week high Rs 993.00 and 52-week low Rs 674.80 on 07 October, 2021 and 20 June, 2022, respectively.
Currently, it is trading 26.49 percent below its 52-week high and 8.18 percent above its 52-week low.Market capitalisation stands at Rs 15,339.37 crore.
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