ICICI Direct report believes that Minda Corporation share price may go up to ₹260 apiece levels from current ₹190 per share mark.
Minda Corporation share price has remained under base building mode for the last two months. However, the auto stock has started giving fresh upside swing in last few session giving an indication that the stock is about the come out of the consolidation phase. As per the ICICI Direct research report, Minda Corporation share price may go up to ₹260 apiece levels in long term from current ₹190 per share mark.
Our experts say, "Minda Corporation (MCL) primarily serves domestic auto OEMs across two main verticals – mechatronics & aftermarket (safety & security, die-casting, starter motors, etc.) and information & connected systems (wiring harnesses, instrument clusters). As on FY22, 2-W forms a large part of its sales at ~49% with CV, PV share of sales pegged at ~19%, ~18%, respectively. It has a largely EV immune product profile. Interestingly, it is already supplying its products to EV OEMs like Ola Electric, Ampere, Revolt among others and has also developed products exclusively for EVs viz. DC to DC converter, motor controller, telematics, battery charger, etc."
On valuations of Minda Corporation shares, the brokerage report says, "With robust order wins ( ₹5,930 crore lifetime orders- FY22; replacement & new business combined; EV order win at ₹952 crore) and penchant to grow ahead of industry (by 10-15%), we build ~24% sales CAGR in FY22-24E with RoCE and EBITDA margins expected to improve to ~20% and ~12%, respectively, by FY24E. It is currently trading at inexpensive valuations of ~14x PE on FY24E numbers and offers an attractive risk-reward play."
OUR ADVICE - "We maintain our BUY rating to the stock valuing it at ₹260."
