Buy Bajaj Corp – Target 155
CMP: Rs 126
Target: Rs 155
Following a management meet, we have a positive take-away on Bajaj Corp. The company has sustained the strong performance by its current range of hair oils. Margins are expected to further benefit from the fall in raw material prices and possible price hikes. Going forward, the company targets inorganic growth with sharp focus on acquisitions. The company is looking aggressively to acquire a consumer company/ brand in coming quarters. It has indicated cash of Rs 400 crore on its balance sheet and debt would be utilised to fund acquisitions. To drive inorganic growth, it has inducted Mr Jimmy Anklesaria on the board. We retain buy on the stock.
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