Sharekhan's research report on Sundram Fasteners
Q1FY23 results exceeded expectations on all front, with revenues, EBITDA and PAT beating estimates by 5.2%, 8.5% and 10.8%, respectively. With growing traction in new businesses, Sundram Fasteners Limited (SFL) plans to invest Rs. 350 crore for EVs and select ICE vehicles over the next 5 years and additional Rs. 300 crores for wind energy business over the next two years. The stock trades at P/E multiple of 19.8x and EV/EBITDA multiple of 12.6x its FY2024E estimates.
Outlook
We maintain a Buy on SFL with an unchanged PT of Rs. 1,030, led by the company’s dominant position in the fasteners segment, diverse client base and product portfolios, established client relationships, and prudent capital allocation.
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Sundram Fasteners -010822 - khan
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