Sharekhan's research report on Greaves Cotton
Greaves is well positioned to benefit from the government’s push towards fast adoption of electric vehicles (EVs) in the automobile industry. We have revised our earnings estimates upwards and expect Greaves’ earnings to report a robust 80.3% CAGR during FY2021E-FY2023E, driven by 24.4% revenue CAGR and a 580 bps improvement in EBITDA margin. The stock is trading below its average historical multiple at P/E multiple of 17.2x and EV/EBITDA multiple of 10.2x its FY2023E estimates.
Outlook
We interacted with the management of Greaves Cotton Limited (Greaves) to take a deep dive into the company’s new transformative business goals. We believe the company is moving on the right track with huge potential for business growth. We maintain our Buy rating on the stock with a revised PT of Rs. 170.
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