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Axis Securities
Gabriel India (Buy)
CMP: ₹157.70
Target: ₹174
Gabriel India is engaged in the manufacturing and marketing of ride control products. The company’s portfolio includes a range of ride control products, which consists of shock absorbers, struts and front forks for every automotive segment.
Gabriel India posted an excellent third quarter results led by about 22 per cent y-o-y growth in 2/3 wheelers, about 13 per cent growth in PVs and about 49 per cent growth in CVs (which included Railways).
Gabriel has pitched for new launches from the stable of Yamaha, Suzuki, Royal Enfield and other OEs in 2W segment; the company has won LoI for Honda Activa front fork and the supply would start from March 2019 for their Gujarat & Narsapara plant with good volumes. Company has also won some orders from domestic 3W OEs; the order volume is small with huge potential in future.
Gabriel has 80 per cent market share for the shock absorbers in CVs. Railways are shifting towards the LHB coaches which sport higher number of shock absorbers and hence, the opportunity size is quite large.
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