Dolat Capital Market has given Buy recommendation for Jamna Auto Industries with a target price of Rs. 99 in its research report issued on Mar 01, 2021
Dolat Capital Market’s research report on Jamna Auto Industries
Jamna Auto Industries (JAI) has maintained its dominance with 68% market share in the domestic OEM segment. JAI has presence amongst most domestic CV players with a relatively high wallet share like Ashok Leyland and Bharat Benz. As JAI’s facilities are located close to OEM plants, the company benefits from lower logistics costs, which makes it difficult for new entrants to garner market share from OEMs. JAI have tremendous potential to gain market share in the aftermarket segment led by launches of various products and expansion in distribution network. We forecast that the Revenue/EBITDA will grow at 48/57% CAGR over FY21-23E, led by revival in high tonnage MHCV segment with uptick in economic activities and margin expansion.
At CMP the stock is trading at 17x for FY23E EPS and 3.8x for FY23E BV. We recommend Buy with upgraded TP of Rs 99 (based on 20x Sept 23E EPS).