Reduce Asahi India Glass; target of Rs 503: ICICI Securities

ICICI Securities recommended Reduce rating on Asahi India Glass with a target price of Rs 503 in its research report dated August 01, 2023.

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August 04, 2023 / 11:39 IST

26 Aug, 2025 12:21

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ICICI Securities research report on Asahi India Glass

Asahi India Glass’ (AISG) Q1FY24 EBITDAM at 20.1%, was up ~330bps QoQ and higher than I-Sec estimate of 17%. The beat was driven by auto segment EBIT margin improvement of ~730bps QoQ to 13.5% (9-quarter high) vs architectural segment EBIT margin remaining flat QoQ at 21%. Increase in the auto margin was driven by price hikes taken by AISG to pass on input cost inflation, operating leverage and improved mix. We believe AISG can maintain its current margin levels in the auto segment in FY24E-FY25E, but non-auto margins are likely to be range-bound. We are factoring-in ~21% EBITDAM in FY24E/FY25E with a revenue CAGR of ~12%, resulting in earnings CAGR of ~22% in FY23-FY25E.

Outlook

Downgrade to REDUCE (from Hold) with a revised DCF-based target price of INR 503 (earlier: INR 468), implying 22x FY25E EPS.

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