Emkay Global Financial has given Buy recommendation for Eicher Motors with a target price of Rs. 3040 in its research report issued on Aug 13, 2021
Emkay Global Financial’s report on Eicher Motors
Q1FY22 EBITDA margin stood at 18.4%, beating our estimate of 17.9%, owing to inventory gains. Revenue came in at Rs19.7bn, slightly above our estimate of Rs19.3bn, thanks to higher-than-expected realizations. Management expects supply disruptions due to the shortage of semiconductors. Factoring in supply issues and slower ramp-up, we reduce FY22/23/24 EPS estimates by 28%/12%/7% to Rs71.2/Rs114/Rs144.1. Despite the cut in estimates, we expect a robust earnings CAGR of 42% over FY22-24E, supported by a sales upcycle, increasing share of premium motorcycles and margin expansion. New products remain a focus area, with the expectation of one new model or major refresh every quarter.