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Motilal Oswal Report
Motilal Oswal Financial Services reiterates its buy rating with a target price of Rs 2,334, valuing Hyundai Motor stock at 26x FY28E EPS.
Hyundai Motor India Ltd. (HMIL) 1QFY27 PAT at Rs 8.9b beat Motilal Oswal Financial Services' estimate of Rs 8.3b, largely due to higher-than-expected other income and lower depreciation. Ebitda margin came in line at 9.3%, down 400bp YoY which the brokerage says was due to the impact of commodity inflation, lower volumes, plant startup costs, and an adverse product mix.
Considering its launch pipeline and a strong export order book, we expect HMIL to post a ~9% volume CAGR over FY26-28. This growth is likely to be boosted by a 12% volume CAGR in exports. Overall, Hyundai Motors is projected to deliver aan approximate of 16% earnings CAGR over FY26-28.
The brokerage believes the company remains well-positioned to benefit from the premiumisation trend in India, given its mix is in favor of SUVs. The stock at 29.7x / 22.6x FY27E / FY28E and the EPS appears attractively valued.
Valuation and view
Considering its launch pipeline and a strong order book in exports, Motilal Oswal Financial Services expect HMIL to post an approximately 9% volume CAGR over FY26-28E. This growth is likely to be boosted by a 12% volume CAGR in exports.
Overall, Hyundai Motors India Ltd. is expected to deliver an approximately 16% earnings CAGR over FY26-28E. Motilal Oswal believes the company remains well-positioned to benefit from the premiumisation trend in India, given its mix is in favor of SUVs. The stock at 29.7x / 22.6x FY27E / FY28E EPS appears attractively valued.
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