Buy Hinduja Group Stock Trading 2.98% Down From 52 Week High, Recommends Dividend: Motilal Oswal

Broking firm Motilal Oswal has a Buy on Ashok Leyland, a flagship company of the Hinduja group. The broking firm with a Buy rating assigns a target price of Rs. 180 on the stock, claiming a potential upside of up to 10% from its current level i.e. Rs. 164.40.

In a Board meeting held on May 23, 2023, the Board recommended a dividend of Rs. 2.60/share of Re.1 each for the financial year ended March 31, 2023. In addition, it also announced the record date for the recommended dividend.

Recommendation of Dividend for the year ended March 31, 2023

According to a regulatory filing by the company, "The Board of Directors of the Company at its meeting held today have recommended a dividend of Rs.2.60 per equity share of Re.1/- each for the financial year ended March 31, 2023 to the shareholders for approval. The said dividend, if approved at the forthcoming Annual General Meeting ('AGM'), shall be paid on or before August 19, 2023."

Valuation and view

According to the brokerage, The demand environment is expected to remain stable, supported by improving pricing power and steady RM prices, which will drive strong earnings. AL is the best investment choice in the CV growth cycle, as it has positioned itself to expand revenue/profit pools. While valuations at 17.3x FY25E P/E and 9.3x EV/EBITDA are reflecting the mid-cycle recovery, they do not fully reflect AL's focus on the diversification of new revenue streams and increasing profit pools. "We reiterate our BUY rating with a TP of INR180 (based on 10x Mar'25E EV/EBITDA + ~INR11/share of NBFC)," the brokerage has said.

Stock Outlook - Market Price, 52 Week High/Low & Returns

On Friday, the stock jumped 4.48%, ended at Rs. 164.40 apiece. It traded its 52 week high on 6 September 2022 at Rs. 169.45 apiece and 52 week low on 17 June 2022 at Rs. 128.20 apiece, respectively.

It gave 7.91% in the last 1 week. While in the last 1 month, it jumped 7.77% and in the past 3 months it jumped 17.64%. It has given 26.56% positive return. It gave 223.3% positive return in the last 3 years. While it gave 15.57% positive return in 5 years.

About - Ashok Leyland Ltd.

Ashok Leyland is the 2nd largest manufacturer of commercial vehicles in India, the 4th largest manufacturer of buses in the world, and the 19th-largest manufacturer of trucks. It is a midcap company with a market capitalisation of Rs. 48,269.93 crore.

Disclaimer - The above stock has been picked from the brokerage report of Motilal Oswal Financial Services. 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.