Axis Capital Bets On Small Cap Stock, Buy For Potential Upside, Jumps 38.22% In 3 Months

Axis Capital has in its recent report on Landmark Cars Ltd. initiates a Buy on the stock. The brokerage has assigned a target price of Rs. 810 apiece on the stock, claiming a potential upside of up to 11% from its current level. It is a small cap Auto sector stock. It has a market capitalisation of Rs. 2,893.20 crore.

Axis Capital believes that Landmark Cars is a great proxy play for PVs in India, owing to (1) management's solid execution capability, (2) a strong market position, particularly in the luxury segment, (3) being highly correlated with the premiumization trend, (4) having diversified revenue streams able to absorb shocks in new-vehicle sales, and (5) a solid financial position with a healthy balance sheet and cash flows.

Proxy play on luxury PVs; initiating coverage with BUY

According to Axis Direct, The improving share of MB (higher growth) and its ROTF model, a pick-up in other brands, and the premiumization trend should drive growth for the company. "We build in revenue/EPS CAGR of 14/29% over FY23-26, and initiate coverage of the stock with a BUY rating and a DCF-derived TP of Rs 810 (implying 20x FY25 EPS)," the brokerage has said.

Stock Outlook

On Thursday, the stock of Landmark Cars closed at Rs. 730.15 apiece. Its recorded 52-week high on 15 June 2023 at Rs. 743.85 apiece and 52 week low on 26 December 2022 at Rs. 431.15 apiece, respectively.

Since its listing on 23 December 2022, the stock has given 59.25% positive return. It jumped 8.25% in 1 week. It gave 5.59% positive return in 1 month and 38.22% in 3 months, respectively.

Disclaimer - The stock has been picked from the Axis Capital report. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.