Confirmed in the Q3 call that Guided 2200 cr for all of group sales by FY27. So, Talbros contribution is expected to be 1400 cr. So, Revenue is likely to be doubled in 3 years, approx 25-30% growth. Company do not have pricing power. Assuming 8% PAT, 20 PE, Market cap will be 2200 cr by FY27. About 35% increase. They are looking to increase exports to 35% revenue so lets assume 10% PAT, 25 PE, Mcap will be 3500 cr. So, essentially, 35% to 100% jump from current price in 3 years time.
They sold off the Japanese JV to Nippon for 81 cr (40% share). Their biggest customer is Maruti Suzuki. I would have preferred a Japanese company like Nippon on the board. Management said that the JV is growing very slow so they are focussing on businesses with 20+% growth potential.
With all this info, Risk Reward ratio seems tilted. I bought small tracking position since i did not have big exposure to Auto market and thought that diversified auto component player maybe a good bet. But now, I am wondering!
What do you all think?
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