Add Endurance Technologies, target price Rs 1,320: Kotak Institutional Equities

Kotak Institutional Equities has add call on Endurance Technologies with a target price of Rs 1320. The current market price of Endurance Technologies is Rs 1285.55.

Endurance Technologies, incorporated in the year 1999, is a Mid Cap company (having a market cap of Rs 18099.09 crore) operating in Auto Ancillaries sector.

Endurance Technologies key Products/Revenue Segments include Shock Absorbers, Aluminium & Die Casting, Brake Discs, Clutch Assembly (Parts), Alloy Wheels, Others, Other Operating Revenue, Components & Spares, Job Work, Scrap, Export Incentives, Power Generation for the year ending 31-Mar-2021.


Financials
For the quarter ended 31-03-2022, the company has reported a Consolidated Total Income of Rs 2091.48 crore, up 10.28 % from last quarter Total Income of Rs 1896.59 crore and down -2.26 % from last year same quarter Total Income of Rs 2139.77 crore. Company has reported net profit after tax of Rs 136.19 crore in latest quarter.

Investment Rationale
Endurance Tech reported consolidated EBITDA of Rs 2.6 bn (-23% yoy) in 4QFY22, which was 41% above brokerage estimate due to a better-than-expected revenue print and cost control measures. The near-term may remain challenging given supply-chain constraints and cost pressures especially in EU operations, however, it expects the company to outperform the domestic two-wheeler industry mainly led by new order wins across product segments. Stock price correction by ~30% over the past six months provides a good opportunity to enter this name.

Promoter/FII Holdings
Promoters held 75.0 per cent stake in the company as of 31-Mar-2022, while FIIs owned 7.22 per cent, DIIs 15.87 per cent.