ICICI Securities has issued a buy rating on ZF Commercial Vehicle Control Systems with a revised target price of ₹2,800, up from the previous target of ₹2,750. According to the research report dated July 28, 2026, the recommendation is based on 45x FY28E EPS valuation. The brokerage maintains its positive outlook on the company despite recent operational challenges.
The company's operational performance was impacted by raw material inflation and higher other expenses, which resulted in EBITDA margin declining by 190 basis points below ICICI Securities' estimates. Despite these headwinds, the domestic market remains on strong footing, supported by healthy demand trends across replacement and OE segments. The company's operational challenges have not deterred the brokerage's bullish stance on the stock's long-term prospects.
Export momentum is expected to improve across US and Europe markets on the back of new product launches and higher demand for air compressors and actuators. As reported by ICICI Securities, this international expansion is expected to contribute significantly to the company's growth trajectory in the medium term. The export-led growth strategy appears to be a key driver behind the brokerage's optimistic outlook.
ICICI Securities projects a revenue CAGR of approximately 17% for FY26-28E, supported by rising content per vehicle and underlying demand trends. The brokerage expects the company to benefit from the evolving regulatory landscape and rising adoption of ABS, EBS, ESC, ADAS and other offerings over the medium to long term. This growth trajectory forms the basis for the revised target price and maintains the buy recommendation despite current operational challenges.
