Recommendation from Auto Ancillaries Gears and Trading Sector

The scrips in this column have been recommended with a 15-day investment horizon in mind and carry high risk. Therefore, investors are advised to take into account their risk appetite before investing, as fundamentals may or may not back the recommendations.

JTEKT INDIA LTD 

CMP - ₹136.35
BSE CODE 520057
Volume 59,780
Face Value ₹1
Target ₹158 - 167
Stoploss ₹132 (CLS)

JTEKT India Ltd. is primarily engaged in the business of manufacturing steering systems and other auto components for passenger car and utility vehicle manufacturers in the automobile sector. The product portfolio of the company includes high-performance rack, hydraulic power steering system, tilt and telescopic steering column, electric power and other products. In Q2FY23, the consolidated revenue of the company rose 48.26 per cent to ₹571 crore in the quarter ended September 2022 as against the previous quarter ended September 2021. The company’s net profit surged over 177 per cent to ₹30 crore in the quarter ended September 2022 as against the previous quarter ended September 2021. The company’s customer base includes major vehicle manufactures in India such as Maruti Suzuki, Toyota, Tata Motors, Mahindra and Mahindra, Honda and Renault Nissan. The stock has shown good momentum this year with the company giving more than 50 per cent returns to its investors on annual basis. Hence we recommend BUY. 
 

 SUNDRAM FASTENERS LTD

CMP - ₹932.45
BSE CODE 500403
Volume 1331
Face Value ₹1
Target ₹1000 - 1040
Stoploss ₹908 (CLS)

Sundram Fasteners Ltd., a part of the TVS Group of companies, is engaged in manufacturing critical, high-precision components such as fasteners, power train components, etc. for the automotive, infrastructure, windmill and aviation sectors. The product portfolio of the company includes high tensile fasteners, cold extruded parts, hot forged parts, powertrain components, pump and assemblies, radiator caps and powder metallurgy. In Q2FY23, the consolidated revenue of the company rose 12.83 per cent to ₹1,401.65 crore in the quarter ended September 2022 as against the previous quarter ended September 2021. The company’s net profit dropped over 5 per cent to ₹116.78 crore in the quarter ended September 2022 as against the previous quarter ended September 2021. The company supplies to a number of international OEMs including GM, John Deere, New Holland, Daimler Chrysler, Cummins, etc. The Board of Directors has declared an interim dividend of ₹3.57 per share for FY23. It also declared an additional special dividend of ₹2 per share. Hence we recommend BUY. 
 

(Closing price as of Dec., 27, 2022)