We are strongly convinced on Gabriel India’s competitive position, key clients, market share. Buy for target price of Rs 409 (27% upside)

Sunroof, EVs & Key OEMs gaining share to drive earnings!

We trust Gabriel has a very promising future on account of 1) benefits due to sustained demand recovery in the coming years across automobile segments, 2) well-diversified product portfolio, 3) key customers gaining share, 4) winning new orders from electric vehicle OEMs, 5) steady revenue growth visibility into the aftermarket sales, 6) entering into high growth, better margin products viz. automotive sunroof, and we anticipate further introduction of new technology agnostic products to drive growth higher than the industry. Gabriel India is net cash positive with reasonably healthy return ratios and is trading at 17.4x Sept 2025 estimated EPS. Initiating coverage with BUY rating for a target price of Rs 409 per share, valued at 22x Sept 2025 EPS of Rs 18.6.

Outlook and valuations

► We are strongly convinced on the company’s competitive position, its key clients gaining market share, new avenues of growth after entering into automotive sunroof, and boosted efforts in the aftermarket, exports & railways.

► Gabriel is well placed for the mid-to-long term growth opportunities as they plans to enter into a few new products, starting sunroofs. The company is debt free with cash & investments of Rs 1.87 bn, and has always generated good positive cash flows in the past eleven years.

► The stock is trading at P/E of 17.4x Sept 2025 estimated EPS of Rs 18.6. Gabriel has strong growth prospects with healthy return profile, we have assigned a multiple of 22x to its Sept 2025 estimated EPS to arrive at a target price of Rs 409 a piece.

► The company has been trading at ~18x 1-year forward PE in the last five years, a ~20% premium (22x) is largely as Gabriel India has finally opened-up and plans to add newer products, warrants a higher premium multiple vis-à-vis past.