Ceat's Integration Of Camso To Be A Key Monitorable, Says Motilal Oswal Maintaining 'Buy'

Ceat’s debt/Ebitda is likely to rise to 2x (current 1.3x) once the Camso acquisition is completed, which is comfortable as per management. Given that tariffs would be levied on all regions, management does not expect a material impact of tariffs on Ceat’s operations, including Camso..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Motilal Oswal Report.We met Ceat Ltd. management at the RPG Conference. In India business, management continues to expect good demand in the tractor and two-wheeler replacement segments even as two-wheeler OEM demand is now slowing down. While passenger vehicle replacement is likely to post 0-5% growth, PV OEMs are likely to be flat YoY in FY26. Management expects truck-bus radial replacement to grow in single digits, and TBR OEMs are likely to post 5% growth in FY26. Further, the full benefit of the decline in input costs is likely to be reflected by Q2 FY26. The pricing discipline remains stable, and Ceat has been able to hold on to its pricing so far. It expects to consolidate the Camso acquisition from Q2 FY26 onward. Ceat would pay about 60% of the consideration value of $225 million within a month and the balance over the next one-three years when it is due. Debt is likely to rise to Rs 30 billion by FY26 end from Rs 19 billion currently – after considering the standalone capex of Rs 10 billion. Ceat’s debt/Ebitda is likely to rise to 2x (current 1.3x) once the Camso acquisition is completed, which is comfortable as per management. Given that tariffs would be levied on all regions, management does not expect a material impact of tariffs on Ceat’s operations, including Camso. Overall, we expect Ceat to clock a CAGR of ~10%/16%/35% in revenue/Ebitda/PAT over FY25-27E. We reiterate our Buy rating on the stock with a target price of Rs 4,159 (based on ~18x Jun’27E EPS)..Click on the attachment to read the full report:.Shriram Finance- Motilal Oswal's Top Pick In NBFC Sector — Here's Why.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Ceat's Integration Of Camso To Be A Key Monitorable, Says Motilal Oswal Maintaining 'Buy'

Benefits of lower input costs to be visible in Q2 FY26, says Motilal Oswal, hence retains 'Buy' rating on the stock.

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