The Hyundai Motor India stock price surged 2% to an intra-day high of Rs 2,462, but soon came off highs. In fact, the stock has declined 7% in the last 1 month. Brokerages, too, have raised concerns, and some have cut the target price for the next 12 months.
Here is a look at the challenges that analysts foresee-
Motilal Oswal on Hyundai Motor India: Operational cost
Motilal Oswal maintained its ‘Buy’ rating on Hyundai Motor and kept the target price unchanged at Rs 2,801, implying an upside of 16% from the current market price. The brokerage firm believes that the company is well-positioned to benefit from the premiumization trend in India, given its mix in favour of SUVs.
Hyundai India aims to launch 26 products by FY30, out of which eight are likely to be launched over FY26-27. Considering this launch pipeline, the brokerage sees a 6% volume CAGR over FY25-FY28, which is largely back-ended. This is likely to be boosted by a 20% volume CAGR in exports.
However, Motilal Oswal stated that higher-than-expected operating costs for the new Pune plant will impact earnings in the near to medium term. Nonetheless, the company is expected to deliver 15% earnings CAGR over FY25-FY28.
Nuvama on Hyundai Motor India: Steady ride in Q2
Nuvama Institutional Equities cut the target price on Hyundai Motor to Rs 2,900 from Rs 3,200. The new price target implies an upside of 20% from the current market price. The brokerage firm maintained its ‘Buy’ call on the stock.
Over the next 18 months, launches and refreshes—including a compact SUV and micro E-SUV— are expected to drive domestic revenue CAGR of 7% while deeper penetration in Emerging Markets shall compound exports revenue at 14% over FY25–28, said Nuvama.
However, to factor in higher costs related to the new Talegaon plant, Nuvama slashed EPS estimates by up to 10% for FY26–28.
Hyundai Motor India stock performance
The share price of Hyundai Motor has risen 5.3% in the past five trading days. The stock has declined by 6.7% over the last one month. However, the stock has raised investors’ wealth by 41% in the past six months and 32% in the previous one year.
