IGARASHI MO­TORS INDIA

Dalal Street Investment Journal - - RECOMMENDATIONS EQUITY -

Igarashi Mo­tors India, an auto com­po­nent man­u­fac­turer, is ba­si­cally into the busi­ness of de­sign­ing small per­ma­nent mag­net DC mo­tors and gear mo­tors used in elec­tronic throt­tle con­trol, ex­haust gas re­cir­cu­la­tion and tur­bocharg­ers. Nine ma­jor na­tions ac­count­ing for 80% of to­tal pas­sen­ger car mar­kets have pro­posed re­duc­tion in emis­sions by 20-50% over FY17-21. The com­pany holds lower pen­e­tra­tion, de­spite dou­ble digit mar­ket share world­wide. The com­pany’s Q4FY17 re­mained flat but posted growth in FY17 an­nual earn­ings. Its rev­enue and PAT growth came in at 14% and 16% to ₹508 crore and ₹74 crore, re­spec­tively. It has re­duced its debt and is now vir­tu­ally debt-free. Thus, with the gov­ern­ment’s emis­sion reg­u­la­tions and con­sumer pref­er­ence, we rec­om­mend a Buy in the scrip for a tar­get of ₹1125, with a stop loss of ₹950

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