Mid-cap Forgings stock engaged in manufacturing and selling of automotive components to OEM’s gets a ‘Buy’ tag on it from Edelweiss which is one of the leading and well known financial services company, with an upside potential 58 percent from its previous price
CIE Automotive India
With a market capitalization of Rs.18,285 Crores, on November 6,2023, the shares of CIE Automotive India were trading at Rs. 482 up 0.23 percent from its previous day close price of Rs. 481.30.
Edelweiss, one of the well-known Investment Banks, has given a ‘Buy’ tag to the company’s stock with a target price of Rs 710 indicating a potential upside of 47 percent as compared to the closing stock price levels.
The rationale behind providing such a recommendation pertains to various trigger points Comprising, the management reaffirmed its commitment to outpace the industry growth rate by 5–10 percent.
This strategic pursuit is anchored to its focus on value-added products, capitalising on synergies between various divisions, and leveraging technological support from its parent company.The estimates for 2024 and 2025 remain unchanged, with the expectation of timely execution of new orders in India and Europe.
CIE INDIA continues to enhance its operations with diversified revenue, expansion into niche segments, and technical advancements in collaboration with its parent company.
CIE India’s robust business model offers promising growth prospects. It anticipates a CAGR for sales of 12 percent, EBITDA of 19 percent, and PAT of 22 percent over 2022–24, with an expected improvement in EBITDA margin and RoCE.
According to the company’s financial statements its revenue decreased by 1.76 percent from Rs. 2,320 Crores in Q1FY24 to Rs. 2,279 Crores in Q2FY24, accompanied by increasing profits of Rs. 301 Crores to Rs. 375 Crores.
According to the latest shareholding data available for the June 2023 quarter, the company’s Promoters hold 65.70 percent stake, Domestic Institutional Investors hold 14.79 percent and the Foreign Institutional Investors hold 7.54 percent.
CIE Automotive India is engaged in the business of production and sale of automotive components to original equipment manufacturers and other customers in India and overseas.
Written by: Bharath K.S
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