Buy Minda Corporation, target price Rs 220: ICICI Direct

ICICI Direct has buy call on Minda Corporation with a target price of Rs 220. The current market price of Minda Corporation Ltd. is Rs 171.35.

Time period given by analyst is one year when Minda Corporation Ltd. price can reach defined target.

Minda Corporation Ltd., incorporated in the year 1985, is a Small Cap company (having a market cap of Rs 4030.88 Crore) operating in Auto Ancillaries sector.

Minda Corporation Ltd. key Products/Revenue Segments include Other Auto Components, Other Operating Revenue, Scrap, Duty Drawback, Royalty Income and Job Work for the year ending 31-Mar-2021.


Financials
For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 738.78 Crore, up 30.46 % from last quarter Total Income of Rs 566.30 Crore and up 11.34 % from last year same quarter Total Income of Rs 663.55 Crore. Company reported net profit after tax of Rs 36.71 Crore in latest quarter.

Investment Rationale
With robust order wins, CV cyclical upswing, growth focus in aftermarket space & consolidation of JV partners stake, the brokerage builds 25.4% sales CAGR in FY21-23E. Corresponding RoCE and margins trajectory is expected to improve to 16.8% and 12.2%, respectively, by FY23E. With net cash positive b/s and inexpensive valuations (~17x PE on FY23E) the brokerage has a positive view on MCL and assign BUY rating to the stock

Promoter/FII Holdings
Promoters held 64.73 per cent stake in the company as of 30-Sep-2021, while FIIs owned 4.99 per cent, DIIs 12.53 per cent.