UNO Minda Ltd. share price target

Our Pick: From the auto component stocks under our coverage, we expect Minda Industries and Minda Corp to benefit from this scheme.

We downgrade our rating to HOLD on expensive valuations of the stock with a target price of Rs 730 (earlier target Rs 704), implying an upside of 5% from CMP.

Background Established in 1958, Minda Industries (MIL) is a flagship Company of UNO MINDA GROUP and one of the leading suppliers of proprietary automotive solution to OEMs. Headquarter at Manesar, Gurgaon, the company has 62 plants globally and R&D; centers spread across the globe in 8 locations. The company offers a wide range product across different verticals of auto components like switching systems, lighting systems, acoustic systems and alloy wheels among others. It has more than 230 design registration and more than 30,000 touch points. Company has ~50% market share in switch segment thus leading automotive components...

Background Established in 1958, Minda Industries (MIL) is a flagship Company of UNO MINDA GROUP and one of the leading suppliers of proprietary automotive solution to OEMs. Headquarter at Manesar, Gurgaon, the company has 62 plants globally and R&D; centers spread across the globe in 8 locations. The company offers a wide range product across different verticals of auto components like switching systems, lighting systems, acoustic systems and alloy wheels among others. It has more than 230 design registration and more than 30,000 touch points. Company has ~50% market share in switch segment thus leading automotive components...

New products to drive growth

We retain a BUY and value the company at 32x FY23E to arrive at a target price of Rs 724, implying an upside of 10%.

Minda Industries Ltd (MIL) is a diversified auto ancillary supplier, manufacturing products such as switches, horns & lights. MIL holds a leadership position in switch business with a market share of 67%. Q4FY21 consolidated revenue grew by 49%YoY outperforming the industry growth of 31%. In which, MIL grew by 48%YoY and Merged entity Harita Seating Ltd grew by 59% respectively. This was mainly on account of new customer addition in 2W/4W,...

Background Established in 1958, Minda Industries (MIL) is a flagship Company of UNO MINDA GROUP and one of the leading suppliers of proprietary automotive solution to OEMs. Headquarter at Manesar, Gurgaon, the company has 62 plants globally and R&D; centers spread across the globe in 8 locations. The company offers a wide range product across different verticals of auto components like switching systems, lighting systems, acoustic systems and alloy wheels among others. It has more than 230 design registration and more than 30,000 touch points. Company has ~50% market share in switch segment thus leading automotive components...

Minda Industries Ltd (MIL) Q4FY21 result was below our and above consensus estimates at operating level. EBITDA margin for the quarter stood at 13.5% vs our/consensus estimates of 15.5%/ 13.3% respectively mainly on account of higher RM cost. Revenue growth for the quarter was 49% YoY/10% QoQ to Rs22.4bn vs our estimates of Rs.21.6bn. The Company has completed the merger of Harita Seating limited from 1st April 2021. The merger is effective from 1st April 2019. We build our FY22/FY23 revenue estimates by 30%/20% respectively factoring the strong growth in FY22 on account of low base of FY21 and Harita seating merger. We expect revenue/earnings...