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Buy Automotive Axles: target of Rs 2375: ICICI Direct

ICICI Direct is bullish on Automotive Axles has recommended buy rating on the stock with a target price of Rs 2375 in its research report dated August 09, 2022.

August 10, 2022 / 12:08 PM IST
 
 
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ICICI Direct's research report on Automotive Axles

Established in 1981, Automotive Axles (AAL) is largest independent manufacturer of rear axle drive assemblies in India (primarily for CVs; M&HCV). As of FY20, rear drive axles comprise ~60% of its topline with brakes share at ~20% and other parts comprising the rest • Counts all major OEMs as its clients in the CV domain with prominent names being Ashok Leyland, VECV Commercial Vehicles, M&M among others.

Outlook

Retain BUY given cyclical recovery in CV space (M&HCV domain) with AAL a key beneficiary and the company making tangible efforts on diversification of its client base (targeting construction equipment, defence space). Upgrading our estimates, we now value the company at a revised target price of Rs 2,375 i.e. 20x P/E on FY24E EPS (earlier TP Rs 2,140).

For all recommendations report, click here

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Automotive Axles - 090822 - ic

Broker Research
first published: Aug 10, 2022 12:07 pm

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