Motilal Oswal is bullish on Motherson Sumi has recommended buy rating on the stock with a target price of Rs 437 in its research report dated April 2, 2018.
Motilal Oswal's research report on Motherson Sumi
SMRPBV has proposed to acquire a 100% stake in Reydel Automotive for USD201m. This acquisition is structured under a Lockbox arrangement with effect from 1st January 2017.This stake would be bought from Cerberus Capital, a private equity player. Reydel was carved out from Visteon and acquired by Cerberus in 2014. Acquisition price of equity valued at USD201m implies EV/EBITDA of 2x CY17.
Outlook
We await further financial details before incorporating Reydel into our estimates. For MSS, we currently estimate consol. revenue/EBITDA/PAT CAGR (FY17-20) of 25%/33%/31%. The stock trades at 25.9x/18.6x FY19E/20E consol. EPS. Maintain Buy with a TP of INR437, valuing 25x FY20E consol. EPS (in line with historical average).For all recommendations report, click here
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