Company Update - Minda Corporation - ICICI Direct

Minda Corporation (MCL) reported strong Q3FY21 results. Consolidated net sales rose 36% YoY to Rs. 740 crore (like-to-like basis) - far outpacing the growth observed in the domestic OEM space. Blended operating margins rose 100 bps QoQ to 11.1% (110 bps increase in mechatronics division to 13.8%; 40 bps increase in information connected systems division to 7.1%) amid 80 bps QoQ gross margin expansion and 80 bps savings in other expenses on percentage of sales basis. Consequent consolidated PAT was up 19% YoY to Rs. 49.5 crore.

Valuation & Outlook

FY21E-23E PAT CAGR at MCL is seen at ~62% (albeit on a low base). Broad-based positivity across served segments domestically, new order wins along with structural margin tailwinds help us maintain BUY on MCL. We value it at Rs. 120, 15x P/E FY23E EPS (previous target price Rs. 105) and remain enthused by its long term vision to clock ~12% margins and ~20%+ RoIC.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_MindaCorp_CoUpdate_Mar21.pdf

Shares of Minda Corporation Ltd was last trading in BSE at Rs.98.6 as compared to the previous close of Rs. 95.05. The total number of shares traded during the day was 51061 in over 701 trades.

The stock hit an intraday high of Rs. 99.3 and intraday low of 93.35. The net turnover during the day was Rs. 4995272.

Source : Equity Bulls

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