Motilal Oswal's research report on Eicher Motors
In 1QFY24, EIM exceeded expectations with a consolidated EBITDA margin of 25.6% (vs. est. 24.8%), driven by price hikes (~1.5% impact) and cost savings (0.8%). We expect EBITDA margin to remain range-bound over the next few quarters as there is limited scope of price hikes due to stable RM and increasing competition, coupled with the impact of weak mix. We upgrade FY24E SA EPS by 5%, primarily due to higher ‘other income’. However, for VECV, there was a margin miss, leading us to moderate the margin assumption for the CV business.
Outlook
We reiterate our Neutral rating on the stock with a TP of INR3,600 (Sep-25E based SOTP).
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