ICICI Direct's research report on Mahindra CIE
Mahindra CIE (MCI), part of the Spain-based CIE Automotive Group, is a multi-technology, multi-product automotive component supplier. CY21 consolidated revenue mix – Europe 49%, India 51% • Forging is ~59% of consolidated sales (86% in Europe) • In India, it derives 37%, 31%, 16%, 8% of sales from PV, 2-W, tractors, M&HCV, respectively • In Europe it derives 36%, 39%, 9% of sales from PV, MHCV, off highway, respectively.
Outlook
We retain BUY, tracking healthy demand prospects, strong CFO/FCF yields (~10/5%) & healthy return ratios matrix (ex-goodwill RoIC: ~30%+). Introducing CY24E, we now value MCI at 10x CY23E EV/EBITDA for revised target price of Rs 380 (earlier target price: Rs 325).
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