Sharekhan recommended Hold rating on Greaves Cotton with a target price of Rs 90 in its research report dated June 08, 2020.
Sharekhan's research report on Greaves Cotton
Greaves Cotton Ltd (Greaves) results were lower than estimates as steep drop in topline and margin contraction impacted earnings. Covid-19 is expected to impact growth across segments. Margins are expected to remain under pressure due to negative operating leverage and pricing pressures from clients. We have cut our estimates to factor impact on earnings.
Valuations at 14.4x FY22 earnings are close to long term historical average of 16-17x. We retain Hold rating on the stock with unchanged PT of Rs 90.
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