INDIA CEMENTS
Reco price: Rs 70,
Target price: Rs 83
The management has indicated no immediate plan of capacity expansion from its current capacity of 14.1million tonnes,besides a capacity of 1.8 million tonnes at Trinetra Cement, Rajasthan. The company has gradually shifted focus to Tamil Nadu and Kerala, with 50 per cent of sales coming from these markets as compared to 44 per cent at the end of FY11. The management has indicated the infrastructure division will not be a key contributor in the short/medium-term. We maintain our earnings estimates at Rs 7.6 crore and Rs 9.9 crore for FY12 and FY13, respectively. We have valued the company at an EV/tonne of $78 (35 per cent discount to the replacement cost). The stock trades at a P/E of 9.2x FY12 and 7.1x FY13 estimated earnings. We have revised our target price to Rs 83 per share from Rs 87 earlier. Maintain ADD.
Reco price: Rs 70.25,
Target price: Rs 130
The stock’s recent underperformance (down 28 per cent against Sensex’s decline of 7.3 per cent over the last month) can primarily be attributed to the company’s $225 million FCCB dues in a depreciating rupee environment, exposure to the EU through its foreign custom-moulding subsidiaries and concerns about foray into the power EPC business, with the promoter group’s to set up a 300-Mw power plant. Sintex trades at a P/E of 3.6x and a price to book value of 0.6x on a one-year forward basis, compared to a five-year median P/E of 11 times and P/BV of 2 times. These are attractive valuations, given the normalised EPS growth over FY13E-FY14E and a high return on equity of 17 per cent. We lower our target price to Rs 130 from the earlier Rs 200 due to moderating growth and flattening returns over FY12. Buy
Reco price: Rs 70,
Target price: Rs 83
The management has indicated no immediate plan of capacity expansion from its current capacity of 14.1million tonnes,besides a capacity of 1.8 million tonnes at Trinetra Cement, Rajasthan. The company has gradually shifted focus to Tamil Nadu and Kerala, with 50 per cent of sales coming from these markets as compared to 44 per cent at the end of FY11. The management has indicated the infrastructure division will not be a key contributor in the short/medium-term. We maintain our earnings estimates at Rs 7.6 crore and Rs 9.9 crore for FY12 and FY13, respectively. We have valued the company at an EV/tonne of $78 (35 per cent discount to the replacement cost). The stock trades at a P/E of 9.2x FY12 and 7.1x FY13 estimated earnings. We have revised our target price to Rs 83 per share from Rs 87 earlier. Maintain ADD.
SBICAP Securities
SINTEXReco price: Rs 70.25,
Target price: Rs 130
The stock’s recent underperformance (down 28 per cent against Sensex’s decline of 7.3 per cent over the last month) can primarily be attributed to the company’s $225 million FCCB dues in a depreciating rupee environment, exposure to the EU through its foreign custom-moulding subsidiaries and concerns about foray into the power EPC business, with the promoter group’s to set up a 300-Mw power plant. Sintex trades at a P/E of 3.6x and a price to book value of 0.6x on a one-year forward basis, compared to a five-year median P/E of 11 times and P/BV of 2 times. These are attractive valuations, given the normalised EPS growth over FY13E-FY14E and a high return on equity of 17 per cent. We lower our target price to Rs 130 from the earlier Rs 200 due to moderating growth and flattening returns over FY12. Buy
Goldman Sachs India
No comments:
Post a Comment