Geojit has given Buy recommendation for Tube Investment of India with a target price of Rs. 1306 in its research report issued on Jul 14, 2021
Geojit’s research report on Tube Investment of India
Tube Investment of India (TII) is a flagship company of Murugappa group. It is one of the leading product manufacturers for major industries such as Automotive, Railway, Construction, Mining, etc. TIIs strategy to de-risk from the auto sector (Revenue mix of 70%) and concentrate more on industrial segments through acquisitions or inorganic growth, to support long term revenue visibility. Acquisition of CG Industrial & Power Co, which provides power and industrial system related service in India, and abroad will enhance TII’s product portfolio and revenue mix. TII’s entry into 3W electric manufacturing will mark the group’s foray into automobile manufacturer from an ancillary player. It is planning to start production & selling electric 3W by Q4FY22.
Given the strong fundamentals and strategic change adopted in the company’s segment mix, we value TII on a consolidated basis and recommend Buy rating with a target price of Rs1,306 at CMP.