Motilal Oswal's research report on SONA BLW Precision Forging
SONACOMS’ 2QFY24 results beat our estimates, led by better mix that contributed to an EBITDA margin of 28.2% (vs. est. 27.4%). The company’s focus on expanding in EVs remains steadfast, with BEV accounting for ~27% of the revenue (vs. 26% in FY23). Additionally, the company now aims for a longterm growth in the broader non-auto mobility sector, which currently represents ~10% of the revenue. We maintain our FY24E/25E EPS projections. We believe the current valuation of ~57.6x/44.4x FY24/25E EPS reflects the company’s robust EV order book as well as its impressive earnings and return profile.
Outlook
We maintain our Neutral stance on the stock, with a TP of INR565 (based on ~45x Sep’25E consol EPS).
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