UNO Minda Ltd. share price target

Considering the company's capabilities to capitalize on the recovery in the automobile sector and outperformance over industry growth, we retain a BUY rating on the stock with a target price of Rs 704 (earlier target Rs 567), implying an upside of 11% from CMP.

Strong performance; Beat on all counts

We recommend a BUY on the stock with a target price of Rs 580/share.

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 (MIL) posted record high quarterly performance in Q3FY21.

MIL said: (1) new EV products BMS, on-board chargers to go into production in next few months (kit value at ~| 5-10,000/unit) and EV focus would be on high value, import substitution products, (2) new customer additions in 4W, BS-VI content increase in 2-W, higher share of business helped switch performance (up 40% YoY), (3) it is in global top decile for alloy wheels in terms of operating costs, (4) lighting, acoustics have scope for margin improvement, (5) peak revenue (~| 400 crore) run-rate of 2-W alloy wheel plant could be achieved by next year end & MIL may prepone phase 2 which expands capacity by 2 million units p.a. to 6 million units p.a., (6) will need...

We retain BUY with a target price of Rs 567 (earlier target Rs 406) on back of capacity of the company to capitalize on the recovery in the automobile sector and outperformance of MIL over industry growth.

Domestic auto industry volumes have been on a steady mend in the months post lifting of lockdown restrictions. Manufacturing and distribution activities have been getting ramped up gradually since June 2020, in step with the rest of the economy. However, the impact of the pandemic on the supply chain continues to inhibit a complete return to production normalcy. Nevertheless, most automotive industry segments have reported successive improvement in offtake throughout June-November 2020 (Exhibit 1) on the back of (i) initial bounce provided by pent-up aspect,...

Relentlessly growing Indian auto component industry ...................................................................... 5 Rising credibility of Indian auto components ...................................................................................... 8 Vast domestic playing field ................................................................................................................. 9 Expanding domestic aftermarket ...................................................................................................... 10 Work towards localisation had already begun ................................................................................. 11...

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...