Gabriel India shares gained 4.2 per cent 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 a target price of ₹1,266 — implying approximately 24 per cent upside from current levels — based on 35x FY28 earnings per share (EPS).
From suspension player to diversified mobility platform
Motilal Oswal called Gabriel India a structural transformation story. The company has operated as a single-product suspension player for nearly six decades — a positioning that inherently constrained its scalability. It is now diversifying aggressively, with management targeting group revenues of ₹50,000 crore by 2030 and plans to launch at least one new product annually while expanding into adjacencies such as sunroofs, solar dampers, and e-mobility.
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Key growth drivers
In the core suspension business, Gabriel India has consistently outperformed the industry, growing at approximately 10 per cent compound annual growth rate (CAGR) against the industry’s approximately 4 per cent. 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 (EV) model win at Toyota Motor Parts and Vehicles.
Dana Anand — a premier driveline player with an estimated 30-40 per cent market share across passenger vehicle, commercial vehicle, and off-highway segments — is being positioned as an export hub for Dana’s global entities. Henkel Anand, one of India’s leading automotive adhesive players, 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.
Financials
Motilal Oswal estimates revenue, Earnings before interest, tax, depreciation, and amortisation (Ebitda), and profit after tax (PAT) CAGRs of 22 per cent, 23 per cent, and 55 per cent, respectively, over FY26-28. Core return on capital employed (ROCE) is expected to expand by 800 basis points (bps) to 37.7 per cent and return on equity by 780 bps to 28.4 per cent by FY28.
The company has a net cash balance sheet, lean working capital of approximately 27 days, and robust cash conversion — with a 10-year net operating cash flow to Ebitda ratio of approximately 81 per cent.
Further group consolidation could unlock significant additional upside, with unlisted Anand Group ventures having a combined PAT of approximately ₹230 crore — potentially equivalent to the value of Gabriel India’s standalone suspension business. Key risks include rising competitive intensity, commodity price fluctuations, technology changes, and geopolitical headwinds.
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