Anand Rathi's research report on Craftsman Automation
Craftsman Automation - Well-crafted for growth; initiating, with a Buy, at a target of Rs.2,655 Dominance in machining critical powertrain components, versatility in aluminium die-casting along with growth augurs well for Craftsman Automation in posting strong growth for the next 2-3 years. Also, growth being a function of capital formation in the country, Craftsman’s industrial and engineering division is expected to grow strongly, driven by the expected increase in capex. We initiate coverage on it, with a Buy at a target price of Rs2,655.
Outlook
On the expected 19% revenue CAGR over FY21-23, we expect 21% EBITDA growth and a 70% CAGR in earnings to Rs2.8bn, leading to an EPS of Rs132.7. We initiate coverage on the stock with a Buy rating at a target of Rs2,655 (20x FY23 EPS).
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