Amtek Auto surges over 19 pc; Nomura starts with 'buy' rating

Amtek Auto surges as much as 19.3 percent to a six-year high of 264.90 rupees after Nomura initiates coverage on the stock with a "buy" rating and a target price of 416 rupees, citing it as a leveraged play on a turnaround in the domestic automotive industry.

Amtek has been very aggressive with capex and acquisitions in the past which has not paid as a slowdown in the key markets of India and Europe led to a build-up of significant debt, the investment bank says in a report on Friday.

Nomura adds it believes the company's management is now focused on improving return ratios and generating free cash flows, which should be taken positively by the market.

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