Cummins India rises over 3% after Kotak sees strong growth prospects

Cummins India

20/04/2023 06:46

** Shares of auto parts maker Cummins India  CUMM.NS  rise
as much as 3.04% to 1,546.75 rupees; mark sharpest intraday pct
gain since Feb. 9
    ** Rise after domestic brokerage firm Kotak Institutional
Equities reiterates "buy" with TP of 1,810 rupees, citing
healthy demand
    ** Median PT at 1,565 rupees - Refinitiv data
    ** Kotak identifies CUMM as the top pick in capital goods
sector
    ** Recent announcement by global parent Cummins Global to
invest $1 bln in existing U.S units a positive cue for India
exports 
    ** Retains earnings estimates and builds in ~16.5% revenue
CAGR over FY2023E-25E and ~18%/26% FY2025E margin/RoE 
    ** CUMM's core profit margin is at a premium to peers like
Kirloskar Oil Engines  KIRO.NS , says Kotak; expects margins to
sustain   
    ** Thirteen of 26 analysts covering the stock have a "buy"
or "strong buy" rating, 5 have "hold" while 8 rate it at "sell"
or "strong sell" - Refinitiv data
    ** Stock up 8.7% YTD, as of last close, outperforming Nifty
500  .NIFTY500  which is down 3.83%


 (Reporting by Ashish Chandra in Bengaluru)
 ((ashish.chandra@thomsonreuters.com (+91 7982114624))