Anand Rathi has given Buy recommendation for Kirloskar Oil Engines with a target price of Rs. 279 in its research report issued on Sep 01, 2022

Anand Rathi’s research report on Kirloskar Oil Engines

KOEL made a good start to FY23. Q1 consolidated revenue/PAT grew ~45%/~154% y/y with a 14.5% EBITDA margin. With government focus on infrastructure and Atma Nirbhar, and strong end-user demand pick-up, we expect better growth in the medium to longer term. Further, its efforts regarding exports (aiming at 15-18%growth) and better B2C margins (higher demand and prices) would prove to be the additional kicker.

Outlook

Hence, strong demand across segments, a sharper focus on exports and efforts to enhance its presence augurs well for the company in coming years. The new leadership (MD, CEO-B2B, CEO-B2C) would bring a fresh vision and focus. We have a Buy rating on the stock, with a TP of Rs279 (13xFY24e EPS).

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