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Despite falling volumes, the recently launched XCD platform has managed to successfully touch the projected 30,000-units-a-month mark. And Bajaj still maintains impressive margins. Says Anikhet Mhatre, Research Analyst, Prabhudas Lilladher: “The strategy of exiting from 100CC segment should alleviate margin pressures, and tax exemptions for bikes produced at its Uttaranchal plant will improve profitability.” We reiterate our ‘hold’ recommendation with a price target of Rs 2,550 over a period of one year.”
The stock closed on February 14 at Rs 2,077.3.
Hero Honda has managed to hold on to sales and, as the recent third quarter results have shown, the company has actually improved margins. Says Mhatre: “While we remain cautious on the two-wheeler industry, we believe Hero Honda is the best bet in the segment. A slackening of lending norms could provide a much-needed trigger for the sector. In such a scenario, we believe Hero Honda will outperform the industry.” The stock has a price target of Rs 840 in the next 12 months’ time.
The stock closed on February 14 at Rs 730.15.
Maruti has a fairly aggressive and focussed strategy, with the B-segment remaining its favourite playground. Analysts at PINC Research expect the company to continue to outperform the industry in 2008-09, and place a “buy” rating on its stock with a price target of Rs 1,120 over the next 12-15 months.
The share closed on February 14 at Rs 829.2.
Brokers advise caution if you are looking at Tata Motors as a slew of expansion and new projects mean there are too many variables to deal with. In commercial vehicles, its prospects look promising. Says Ajay Parmar, Institutional Research Head, Emkay Shares & Stock Brokers: “We expect the entire commercial vehicle sector to turn around in 2008-09.” However, investors are advised to remain cautious about the automaker’s passenger car division that seems to be doing too many things at once. The stock is a market performer and analysts at Prabhudas Lilladher expect it to touch a price of Rs 830 in the next one year.
The scrip closed on February 14 at Rs 733.15.
Amtek is poised to gain significantly from the huge expansion in the capacity of the Indian passenger car industry over the next few years. “Despite the robust growth rate over the last 18 months, the company has underperformed the stock market, primarily due to heavy dilution of equity. We maintain a ‘buy’ rating on the stock with a target price of Rs 240 over the next 8-12 months,” Mhatre says.
The stock closed on February 14 at Rs 140.65.
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