Greaves Cotton Ltd - Long term intact, Retain Buy - Emkay

Reco: BUY
CMP: Rs 65
Target Price: Rs 80

- Q1FY13 results ahead estimates driven by better than expected revenue growth at 2% yoy to Rs4.1 bn. EBITDA margins down 210 bps yoy, APAT down 13% yoy to Rs305 mn.

- Engines surprises with 7% yoy revenue growth (ramp-up in Tata Motors offsets decline in 3-W). Infrastructure improves with lower EBIT loss at Rs16 mn.

- Cut our earnings estimates by 2% for FY13E and by 3% for FY14E to factor subdued demand in the 3-W auto segment.

- Near term earnings risk offset by FCF yield of 8% in FY14. Retain Buy rating with price target of Rs80/Share (@11X FY14E earnings).

Source : Equity Bulls

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