Sharekhan has given Buy recommendation for Lumax Auto Technologie with a target price of Rs. 356 in its research report issued on Sep 09, 2022

Sharekhan’s research report on Lumax Auto Technologies

Lumax Auto is expected to benefit from new order wins from its existing clients, acquisition of new clients, increasing wallet share and new product launches. Lumax Auto is well positioned to benefit from improving demand outlook for 2Ws and 3Ws, and continued growth momentum in PV and CV segments. Earnings expected to grow at a robust 41% CAGR over FY2022-FY2024E, driven by a 26% revenue CAGR and a 100-bps improvement in EBITDA margin at 11% in FY2024E.

Outlook

We maintain our Buy rating on Lumax Auto Technologies Ltd. (Lumax Auto) is with a revised PT of Rs.356, factoring in strong business traction, margin improvement, and comfortable valuations. Stock trades below its historical average multiples at 11.5x P/E multiple and 7.1x EV/EBITDA on FY2024E estimates.

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