Sona BLW: Is order book strong enough to justify high valuations?

It is one of the rare gems in the listed space to play on the megatrend of electrification of vehicles

Nitin Agrawal
June 17, 2022 / 10:49 AM IST
Sona BLW: Is order book strong enough to justify high valuations?

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PRO Only Highlights
-  Quarterly performance largely backed by improved realisations
-  Medium-term triggers China plus and protectionist measures for tyre industry
-  Valuations not inexpensive; but improved medium-term outlook

Sona BLW Precision Forgings Ltd’s (SBPFL) (CMP: Rs581.6; M Cap: Rs 33,890 crore) Q4 FY22 results were in line with Street estimates. A scarcity of semiconductor chips coupled with rising raw material prices continue to hurt. However, it is one of the rare gems in the listed space to play on the megatrend of electrification of vehicles. Though valuations currently seem elevated, the growth outlook and fundamentals of the company are promising and hence we advise investors to accumulate this...