Cummins India Share Price: Buy Cummins India, Target Price Rs 1260 : HDFC Securities

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HDFC Securities has a call to buy on Cummins India with a target price of Rs 1260. The current market price of Cummins India Ltd. is Rs 1106. The period given by the analyst is 6 months when the price of Cummins India Ltd. can achieve the set goal.

Cummins India Ltd., incorporated in 1962, is a mid-cap company (having a market capitalization of Rs 30752.57 Crore) operating in the engineering sector.

The main product/revenue segments of Cummins India Ltd. include engines, sale of services, other operating income, export incentives, scrap for the year ending March 31, 2021.

finance

For the quarter ended 31-12-2021, the company reported consolidated total revenue of Rs 1804.69 Crore, up 0.81% from last quarter, total revenue of Rs 1790.24 Crore and up up 20.99% compared to the same quarter last year. Total revenue of Rs 1491.57 Crore. The company reported a net profit after tax of Rs 216.84 Crore last quarter.

Investment rationale
Cummins India is well positioned to offer a wide range of products when the main diesel/gas power generation assets are phased out. As a subsidiary of Cummins Inc, USA, the company has access to advanced technologies in the field of energy technology. The Cummins Group has spent years innovating and perfecting these alternative technologies that are expected to become mainstream energy requirements. The company’s diversified business presence in power generation, industrial, exports and distribution translates into reasonably strong long-term growth prospects. It plans to expand its product portfolio through a foray into electrification, renewable energy, alternative fuels and advanced long-term analytics. The firm’s strong parentage gives it an edge, giving it access to next-generation products for marginal royalties (~1% of net sales).


Promoter/Fii Holdings
The promoters held 51% of the company’s capital as of December 31, 2021, while the FIIs held 12.54% and the DIIs 23.75%.

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