Gabriel India shares gained 4.2% on BSE, logging an intra-day high of ₹1,017 per share after Motilal Oswal Financial Services initiated coverage on the stock with a 'Buy' rating and target price of ₹1,266. At 9:20 AM, the stock remained up 3.67% at ₹1,016.75 per share, significantly outperforming the BSE Sensex which was up 0.46% at 73,898.29. The target price of ₹1,266 implies approximately 24% upside from current levels, based on 35x FY28 earnings per share. According to the brokerage report, the flagship auto-ancillary company of the Anand Group is undergoing a structural transformation from a single-product suspension player to a diversified mobility platform with significantly larger growth runway.
Over the past two years, management has adopted a more aggressive stance with the group aspiring to scale revenue to ₹50,000 crore by 2030. As reported by Motilal Oswal, the company plans to launch at least one new product annually and expand into adjacencies such as sunroofs, solar dampers, and e-mobility. The brokerage estimates revenue, EBITDA, and PAT CAGRs of 22%, 23%, and 55% respectively over FY26-28. In the core suspension business, Gabriel India has consistently outperformed the industry, growing at approximately 10% CAGR against the industry's approximately 4%. New customer additions include Hero MotoCorp with start of production expected from H2FY27, along with order wins from multiple new platforms at Maruti Suzuki and a new electric vehicle model win at Toyota Motor Parts and Vehicles. The company is now being positioned as the primary growth vehicle for the Anand Group, as evidenced by recent restructuring initiatives including integration of Dana and Henkel, and joint ventures (Enmove, Jinhap) being routed through the listed entity.
According to the report, Gabriel India maintains a strong balance sheet with a net cash position, enabling growth investments without leverage. The company benefits from a lean working capital cycle of approximately 27 days and strong return ratios of 30%+ core RoCE, with core RoCE expected to expand by 800 basis points to 37.7% and return on equity by 780 bps to 28.4% by FY28. At the current market price, the stock trades at 27.1x FY28E EPS. The company has demonstrated robust cash conversion with a 10-year net operating cash flow to EBITDA ratio of approximately 81%. The combination of balance sheet strength and the 55% PAT CAGR estimate makes the risk-reward profile particularly attractive in the auto components space.
The brokerage notes that the group consolidation could unlock significant upside, with unlisted Anand Group ventures having a combined PAT of approximately ₹230 crore - potentially equivalent to the value of Gabriel's standalone suspension business. Recent restructuring initiatives including integration of Dana and Henkel, and joint ventures (Enmove, Jinhap) being routed through the listed entity, are driving long-term shareholder wealth creation. Dana Anand is being positioned as an export hub for Dana's global entities, while Henkel Anand is expected to benefit from rising content per vehicle driven by SUV premiumisation and EV adoption. Beyond these, Gabriel India is diversifying through Inalfa riding rising sunroof penetration in India, Jinhap in fasteners through import substitution, and SK Enmove targeting the large aftermarket lubricants segment. These initiatives are fundamentally changing the value proposition, with much of the Anand Group's diversified value now being captured within the listed entity.
