Kotak securities has given target price for Tractors India as Rs 310 and their recommendation and analysis on stock is as appended below:
We considerably reduce our earnings estimate for FY12 & FY13 to factor in 1)delay in government infrastructure projects 2) increasing input prices 3) rising interest rate scenario. We turn cautious on the increasing trend in debtor days and swelling up of company's working capital needs. At current price of Rs.276, company's stock is trading at 8.5x P/E and 4.7x EV/EBITDA on FY13E earnings.We believe that company's stock along with the peer group is likely to underperform the broader market in near term. We change our rating to 'REDUCE' from 'BUY' earlier on the company's stock with a one year DCF price target of Rs 310 (Rs 560 earlier).