We recommend BUY with a TP of Rs 2,476 (27x FY20E EPS). Swaraj Engines Ltd (SEL) reported strong 4QFY18 revenues at Rs 1.85bn (+15.2% YoY). Engine volumes for the quarter came in at 21,780 units (+9.8% YoY) while realization improved to Rs 85,060 (+5.0% YoY). EBITDA for 4QFY18 grew by 18.4% YoY to Rs 285mn and EBITDA margin stood at 15.4% (+41bps YoY). Margin improvement was driven by ~19bps improvement in each, gross margins and employee expenses.