Prabhudas Lilladher has reiterated 'Accumulate' on Wabco India with target price of Rs 3,285 as against current market price (CMP) of Rs 3,144 in its report.

Commenting on the investment rationale, the stock broker said, ''Wabco India's (WIL's) FY14 Annual Report hints at a recovery in the M&HCV industry, led by new Government initiatives and additional orders to the tune of 10,000 buses under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) scheme.

WIL is targeting growth opportunities in the local markets through increase in content per vehicle in the form of introducing new systems/technologies like Automated Manual Transmission (AMT), Automatic Slack Adjusters, Adjusting valve, higher capacity compressors and increased volumes of Anti-lock Braking System (ABS) post the regulation. In the Aftermarket segment, further potential in retro fitment of AMT is being explored.

WIL is likely to be the key beneficiary of recovery in M&HCV volumes, entry of global players in the Indian Market and implementation of safety norms by the Government for M&HCV. WIL has planned for a capex of Rs 900 million in FY15E, anticipating recovery in the industry. We reiterate 'Accumulate' on the stock, with a TP of Rs 3,285/share based on 26x FY16E EPS, given the robust earnings CAGR of 43% over FY14-FY16E period.''

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