ICICI Direct has given Buy recommendation for NRB Bearings with a target price of Rs. 150 in its research report issued on Feb 08, 2021
ICICI Direct’s research report on NRB Bearings
NRB Bearings posted robust numbers that were largely above our estimates on all parameters. Margins expanded on the back positive operating leverage. Revenue for the quarter came in at Rs 244.7 crore, up 33.7% YoY (vs. I-direct estimate of Rs 220 crore). We expect the robust growth to be attributable to festive uptick and pent up demand. Gross margins expanded 20 bps but EBIDTA margins improved ~680 bps to 17.6%. NRB registered an absolute EBIDTA of Rs 43.1 crore, up 117.7% YoY. Other expenses increased 18.7% YoY to Rs 70.6 crore whereas employee cost grew 12.7% YoY to Rs 38.5 crore. Ensuing PAT came in at Rs 23.3 crore, up 121.3% YoY. Tax rate for the quarter was at 29.8%.
Outlook
We upgrade the target price to Rs 150/share (earlier Rs 110) and maintain our BUY rating on the stock.
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