Buy NRB Bearings, target price Rs 220: ICICI Direct

ICICI Direct has buy call on NRB Bearings with a target price of Rs 220. The current market price of NRB Bearings Ltd. is Rs 167.5. Time period given by analyst is one year when NRB Bearings Ltd. price can reach defined target.

NRB Bearings Ltd., incorporated in the year 1965, is a Small Cap company (having a market cap of Rs 1616.18 Crore) operating in Auto Ancillaries sector.

NRB Bearings Ltd. key Products/Revenue Segments include Bearings, Scrap, Other Operating Revenue and Export Incentives for the year ending 31-Mar-2021.


Financials
For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 255.46 Crore, up 22.13 % from last quarter Total Income of Rs 209.17 Crore and up 28.78 % from last year same quarter Total Income of Rs 198.37 Crore. Company reported net profit after tax of Rs 24.35 Crore in latest quarter.

Investment Rationale
The company has recently announced a capex of Rs 200 crore, focusing on R&D of new products related to EV and also bagged a deal with Ola to exclusively supply needle bearings. Upcoming e- markets and the company’s strategy to have an overseas business with the organisation having a strong presence in the EV segment is also a big positive. The brokerage remains positive on the stock and maintain BUY rating with a target price of Rs 220 based on 18x FY24E EPS

Promoter/FII Holdings
Promoters held 49.82 per cent stake in the company as of 30-Sep-2021, while FIIs owned 22.58 per cent, DIIs 11.9 per cent.