Hold UNO Minda; target of Rs 1312: Deven Choksey

Deven Choksey report on UNO Minda

Uno Minda reported operating revenue of INR 48,140 Mn, up 13.4% YoY and 8.9% QoQ, coming in below our estimate by 2.3%. Growth was supported by healthy traction across Switching Systems, Controllers, Sensors & ADAS, and strong aftermarket momentum. Margin and Profitability: EBITDA stood at INR 5,518 Mn, up 14.4% YoY and 16.4% QoQ, which is below our estimates, led by a revenue miss and higher employee and other operating expenses. The EBITDA margin improved to 11.5%, an increase of 10 basis points YoY and 73 basis points QoQ. These margins were achieved despite facing the start-up costs of recently commissioned plants and nascent businesses that have not yet reached optimum profitability levels Adjusted PAT came in at INR 3,040 Mn, up 28.5% YoY and 37.1% QoQ, though 1.6% below our estimate.

Outlook

We have rolled forward our valuation basis to Sept’27 estimates. We value Uno Minda at 47.5x Sept’27 EPS, implying a target price of INR 1,312 . We downgrade our rating from “ACCUMULATE” to “HOLD” on the stock, as the current valuation already captures the near-term growth visibility and limits meaningful upside from current levels.

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