Visit http://indiaer.blogspot.com/ for complete details �� ��
15.9x FY2012E
CMP : Rs760
RECO : BUY
TP : Rs880
Investment Rationale
§ The company has a strong product pipeline. Unlike its peers, most of the new launches by M&M are in the sub
segments where it has a limited presence. Given its strong brand equity and established distribution network, we
expect M&M to surprise positively on the numbers.
§ Normal monsoon to result in positive surprise on the tractor sales (our estimates 10%/5% volume growth
forFY11/FY12), resulting in a strong earnings upgrades as tractor business has better margins as compared to
automotive business
§ Amongst the four wheeler players, M&M will be least affect by competition, raw material cost pressures and
currency movements
Valuations
§ We have valued the stock on SOTP basis. We have valued the core auto business at a target EV/EBIDTA of 9x
(with a target price of Rs 706). We have valued the subsidiaries at Rs 174 per share.
§ The strong brand equity of its UV and tractor portfolio will ensure limited pressure on the pricing. Our estimates
doe not factor in strong exports from US launch due to continuous delay in the launch
§ Key concerns emerge from the recent M&A activity and complex business structure. Ssangyong acquisition
details can bring in surprises and have an hangover effect on the stock
Hi,
ReplyDeleteHappy Diwali . can you please give me your input about HB Portfolio Ltd?
At current price of around Rs. 42 market cap of HB Portfolio Ltd. is around 50 crores. As per annual report 2010 company has Cash & Bank Balances more that 14 crores(Precisely Rs 140643338) on consolidated balance sheet . You can access annual report from company's website http://www.hbportfolio.com/Investor%20Information/Annual%20Reports/Report%20PDF/ar032010.pdf . So, effective market cap after reducing cash is 36 cr. Company does not have any debt .Can you imaging how much stocks and mutual fund unit this company hold ? As on 31st march 2010 value of stock portfolio is 185 cr (Rs 185,13,13,967) and mutual fund units of 10 crores (Rs 9,98,89,044) . Company is also having unquoted investment worth 39.29 crores (Rs 392897303) in associates companies at book value. For more details refer blog http://value2wealth.blogspot.com/ .