Kotak Securities Stock Idea: Buy Hero Motocorp with Target Rs 5630
Kotak Securities has issued a buy call for Hero Motocorp, setting a target price of Rs 5630. This target represents an upside potential of approximately 1.3% from the current market price of Rs 5557.9. The brokerage firm's positive outlook on the stock is likely based on factors such as the company's strong market share in the domestic two-wheeler industry, its ongoing efforts to expand its product portfolio, and its focus on cost optimization.
About Hero Motocorp:
Hero MotoCorp Limited, formerly Hero Honda Motors Limited, is an Indian multinational motorcycle and scooter manufacturer headquartered in New Delhi, India. It is the largest manufacturer of motorcycles and scooters in the world. The company was founded in 1984 as a joint venture between Hero Cycles and Honda Motor Company of Japan. In 2011, Hero MotoCorp bought out Honda's 26% stake in the company, making Hero MotoCorp an independent entity. The company manufactures a wide range of motorcycles and scooters, including the Hero Splendor, Hero Passion, and Hero HF Deluxe. Hero MotoCorp has a strong presence in India and also exports its products to over 35 countries. The company has a market capitalization of over $10 billion and employs over 7,000 people.
52 Week Price Trend:
Hero MotoCorp, the world's largest manufacturer of motorcycles and scooters, is currently trading at Rs 5557.9, close to its 52-week high of Rs 4979.95. The stock has witnessed significant growth over the past year, buoyed by strong demand for two-wheelers in both domestic and international markets. However, it's important to note that the stock is trading at a premium valuation, and any correction in the overall market could lead to a pullback in the share price.
Stratzy's MOST Analysis:
HEROMOTOCO has been rated AA by Stratzy's MOST framework, indicating medium fundamental risks. This rating is based on an evaluation of the company's management, outlook, safety, and trend. HEROMOTOCO's management is considered competent and experienced, with a strong focus on innovation and growth. The company's outlook is positive, with a well-defined strategy and a strong track record of financial performance. HEROMOTOCO's safety is considered moderate, with a focus on compliance and risk management. Finally, the company's trend is considered positive, with a strong market position and a history of consistent growth.
Company's Fundamentals:
Hero MotoCorp, a leading auto manufacturer listed on the National Stock Exchange of India (NSE), has a Stock PE ratio of 24.18, indicating that its current market price is 24.18 times its annual earnings per share. The Price-to-Book (PB) Ratio of 5.08 suggests that the company's market value is 5.08 times its book value, representing a premium valuation. The Dividend Yield of 2.22% indicates the annual dividend paid per share in relation to the current market price, providing investors with a decent income stream. These financial ratios provide insights into the company's valuation, profitability, and income distribution, aiding investors in making informed investment decisions.
Fundamental and Technical information provided in this blog were last updated on 08 Oct, 2024
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