Multibagger stock rallies 20% in 5 days. ICICI Securities sees more upside
Premium- The brokerage has retained Buy rating on the multibagger stock amid healthy growth prospects, going forward
Shares of Minda Corporation have vastly outperformed Nifty Auto Index. The stock has rallied over 20% in the last five trading sessions as compared to 0.2% fall in Benchmark Sensex. Now, brokerage and research firm ICICI Securities sees further upside in the Minda Corporation shares.
The brokerage has retained Buy rating amid healthy growth prospects, going forward on the multibagger stock, which has surged more than 181% in a year's period, with a 12-month target price of ₹315 per share.
The company's robust order wins of around ₹4,232 crore lifetime orders for 9MFY22, replacement & new business combined; EV order win at ₹843 crore, imparts healthy revenue visibility, as per the brokerage.
“Strong electric vehicle (EV) order book with two new EV OEMs (Hero Electric & BMW) added to list marking all prominent names in the EV space as its clients. Acquisition of JV’s stake in Stoneridge to be margin and return ratios accretive," the note stated.
Consequent consolidated RoE, RoCE seen at 17-19% by FY24E and EBITDA margins are seen improving to 12.2% by FY24E, which could act as key triggers for future price performance, stated ICICI Securities.
Increase in kit value envisaged through content increase in existing products as well as new product offerings. On-boarded marquee EV OEMs like Ola Electric (sole supplier of smart key), Hero Electric, Ampere among others, the brokerage highlighted.
Minda Corporation (MCL) primarily serves auto OEMs across two main verticals – Mechatronics & Aftermarket (i.e. MCH – safety & security, die-casting, starter motors, etc) and Information & Connected Systems (i.e. ICS – mainly wiring harnesses and instrument clusters).
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The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.