Brocking House views on Midcap IT - Sonata Software, Mastek

Parag Parikh views on Sonata Software - Target of Rs 44

Parag Parikh Financial Advisory Services has maintained its buy rating on Sonata Software with a target of Rs 44 in its October 15, 2008 research report. "Sonata Software has reported extremely good results for the 2nd quarter of FY09. Overall, the results have increased our confidence on the company. Factoring the robust Q2 results and the changed currency scenario, we are increasing our earnings estimate for FY09 from Rs 6.25 to Rs 7.25 per share. We maintain our BUY call on the scrip, with a target of Rs 44 based on 6x FY09E (117% Upside)," says Parag Parikh Financial Advisory Services' research report.

PINC Research Views on Mastek - Target of Rs 287

PINC Research has recommended a buy rating on Mastek with a revised 12 month price target of Rs 287 in its October 14, 2008 research report. "Mastek Ltd. (Mastek) reported a soft quarter as net sales in USD terms slid 4.5% QoQ to USD 57.9 million due to a 7% depreciation of the GBP against the USD. The quarter enabled a net profit increase of 6.8% to Rs 412 million."

"At the CMP of Rs 225, Mastek is trading at a P/E of 3.9x and EV/EBIDT of 2.3x its FY09E. While a weak INR should help it post robust growth in FY09, the growth rates would be under pressure and thus FY10 earnings growth could be capped, though it is too early so say that conclusively. While we have downgraded our growth outlook, we still expect Mastek to post a double digit earnings CAGR (FY08-10), which in the back drop of the recent correction in stock price leaves room for a marked upside, despite a sectoral de-rating and earning uncertainty. Hence, we maintain our ‘BUY’ recommendation with a revised 12 month price target of Rs 287. (prev. Rs 514)," says PINC's research report.

Karvy Views on Largecap IT - Wipro, Satyam

Wipro - Target of Rs 358
Karvy Stock Broking has downgraded its rating on Wipro from an outpeformer to buy with a target of Rs 358 in it October 16, 2008 research report. We for Q2FY09, expect its global IT revenues to breach to USD 1.09 billion, which in INR terms works out to sequential growth of 10% and the overall revenues to grow by 9.9%, as we expect its other revenue streams to perform better than the previous quarter."

"As we expect the treasury loss to be to the tune of Rs 745 million, its other income would be negative, as it has a forex cover to the tune of USD 2.2 billion. Even after factoring for higher effective tax rate,the net profit would increase by 6.3% As the stock as come off significantly, we are upgrading the stock from an outpeformer to BUY,target of Rs 358" says Karvy Stock Broking's research report.

Satyam - Target of Rs 350

Karvy Stock Broking has upgraded its rating on Satyam Computer Services from outperformer to buy with a target of Rs 350 in its October 8, 2008 research report. "We expect Satyam to report a sequential revenue growth of 10.3%. It should report a net profit growth of 9.5% sequentially. In terms of people addition there would be a significant improvement and we expect the company to add around 14000–15500 engineers by the year end. As the stock has corrected significantly from our previous recommendation, with no deterioration to its INR earnings, we are upgrading the stock to a BUY from outperformer with an upside of 25% from the current levels," says Karvy Stock Broking's research report.

Karvy Stock Broking Views on HDFC Bank, Petronet LNG

Petronet LNG - Target of Rs 63

Karvy Stock Broking has changed its rating on Petronet LNG from market performer to buy with a target of Rs 63 in its October 15, 2008 research report. "For FY09, we expect the revenue growth of 9.8% to Rs 71,948 million and adjusted profit to rise by 11.9% to Rs 5,309 million. We maintain our target price of Rs 63, but change our rating from Market performer to BUY due to the fall in market price," says Karvy Stock Broking's research report.

HDFC Bank - Target of Rs 1435

Karvy Stock Broking has recommended a buy rating on HDFC Bank with a target of Rs 1435 in its October 15, 2008 research report. "In FY2008-10, we expect that the bank's total business, NII and net profit would grow by 32%, 34% and 31.3% CAGR respectively. Though in FY09, there would slight strain on margin but it would still remain strong at 4.57% (around 38 bps lesser) and thereafter it would improve to 4.7% in FY10. The bank is expected to report RoAA of 1.3% and RoAE of 17%."

Brocking house views on Infosys

Angel Broking on Infosys - Target of Rs 1713

Angel Broking has maintained its buy rating on Infosys Technologies with a revised 12-month target price of Rs 1,713 in its October 10, 2008 research report. "Infosys recorded a strong 11.6% qoq and 32.0% yoy growth in Top-line for 2QFY2009. We maintain a Buy on the stock, with a revised 12-month Target Price of Rs 1,713 (Rs 2,124). However, given the cautious business environment, near-term stock performance is likely to be muted. Nonetheless, the stock remains our Top Pick in the sector," says Angel Broking's research report.

Karvy Stock Broking on Infosys - Target of Rs 2000

Karvy Stock Broking has maintained its buy rating on Infosys Technologies with a target of Rs 2000 in its October 14, 2008 research report. "Infosys reported better than expected, Q2 results with revenues and profits growing sequentially by 11.6% and 10% respectively. We for FY09 and FY10 expect the company to grow its INR earnings by 26% (to Rs 102.7) and 22% (to Rs 125.1) respectively, with valuations looking very attractive. At the current price it is trading at 11xF10E, with ROCE at 40% plus levels, despite 53% of the balance sheet in cash. We continue with our BUY rating with a price target of Rs 2000," says Karvy Stock Broking's research report.

Karvy Stock Views on Defensive Healthcare / Pharma - Part II - Aventis Pharma, Unichem Labs, Jubilant Organosys

Aventis Pharma - Target of Rs 1000

Karvy Stock Broking has maintained its buy rating on Aventis Pharma with a target of Rs 1000 in its October 13, 2008 research report. "Net revenues for the quarter are expected to be higher by 8 % to Rs 2.44 billion. Domestic revenues are expected to show 8 % growth for the quarter. Exports are expected to grow by 8 % to Rs 520 million for the quarter and continue the positive trend set in the preceeding quarter. Currently the stock is quoting at 12.2x CY2008E and 11.1x CY 2009E. We believe the company will undergo a rerating process as it delivers better results going forward. We continue to rate the stock as a BUY with a price target of Rs 1,000 based on 14x CY 2009E," says Karvy Stock Broking's research report.

Unichem Labs - Target of Rs 240

Karvy Stock Broking has maintained its buy rating on Unichem Laboratories with a target of Rs 240 in its October 14, 2008 research report. Net revenues for the quarter is expected to grow by 18% to Rs 1,771 million on the back of 15 % growth in domestic formulations business to Rs 1357 million while there has been greater traction in exports with growth of 23 % to Rs 374 million on account of depreciation of the rupee and buoyed by API exports."

"Profits for the quarter are expected to be higher by 43.7% to Rs 305 million. We downgrade our price target by 11 % to Rs 240 based on 8x FY 2010E. We maintain BUY on the stock," says Karvy Stock Broking's research report.

Jubilant Organosys - Target of Rs 300

Karvy Stock Broking has recommended a buy rating on Jubilant Organosys with a target of Rs 300 in its October 13, 2008 research report. "We expect 37% CAGR growth in net revenues from Rs 24.9 billion in FY08 to Rs 46.8 billion in FY10E driven by strong growth from the CRAMS segment coupled steady revenues anticipated from the IPP (Industrial Performance and Products) business. The higher molasses and alcohol prices will remain a concern for the company. The stock is currently quoting at 9.6 x FY 2009E (EPS Rs 21.5) and 8.2 x FY10E (EPS Rs 25.3). On account of compression in valuations we reduce our price target by 21 % to Rs 300 based on 12 x FY 10E, Buy," says Karvy Stock Broking's research report.

Karvy Stock Views on Defensive Healthcare / Pharma - Part I - Dishman Pharma, Divis Labs, Wockhardt

Dishman Pharma - Target of Rs 310

Karvy Stock Broking has upgraded its rating on Dishman Pharmaceuticals & Chemicals to buy with a target of Rs 310 in its October 16, 2008 research report. "We expect revenues and earnings to grow at a CAGR of 31.4% and 27% from FY08 to FY10E driven primarily from the high margin CRAMS segment. We maintain our long term positive outlook on the company. Currently the stock is quoting at 12.5x FY 09E and 9.7x FY 10E. On account of contraction in valuations we revise our price target downwards by 18 % to Rs 310 based on P/E of 13.1.x FY10E. On account of price correction we upgrade our rating to BUY with a price target of Rs 310," says Karvy Stock Broking's research report.

Divis Labs - Target of Rs 1415

Karvy Stock Broking has upgraded its rating on Divis Laboratories to buy with a price target of Rs 1415 in its October 16, 2008 research report. "The net revenues of the company set to exhibit 25.7% CAGR growth from FY08 to FY10E on account of continued revenue traction. The earnings are expected to grow at a CAGR of 28.1% from FY08 to FY10E which is estimated at Rs 68.3 in FY09E and Rs 88.4 in FY10E. On account of recent price correction due to fall in markets the company is available at attractive valuations. We upgrade our rating to BUY with a price target of Rs 1415 based on a PE of 16x FY10E basis," says Karvy Stock Broking's research report.

Wockhardt - Target of Rs 200

Karvy Stock Broking has recommended a buy rating on Wockhardt with a target of Rs 200 in its October 15, 2008 research report. "Net revenues are expected to grow by 27% to Rs 9.4 billion. Profits for the quarter are expected to be down by 20 % at Rs 870 million. At fully diluted equity at current price the stock is quoting at 7.7x CY08E and 5.4x CY09E. On a multiple of 7x CY09 the stock would be valued at Rs 200. We rate the stock as a BUY," says Karvy Stock Broking's research report.

Angel Broking Views on Smallcap Autos - Automotive Axles, Subros

AUTOMOTIVE AXLES

The company enjoys superior valuation compared to its peers as it has been consistently achieving high levels of profitability. Given the good long-term growth opportunities, impressive clientele, high-end product portfolio and sustained high OPM of over 14%, Automotive Axles, which caters to the commercial vehicle (CV) segment is a good long term investment pick. Though overall CV industry is under cyclical pressure, in long run the MAV (Multi Axle Vehicle), sub-segment is particularly on high growth trajectory and is fast substituting the MCV (Medium Commercial Vehicle) segment. MAV growth is being driven by better cost economics. MAVs are more profitable than the ICVs and MCVs due to which the truck operators are shifting over to MAVs. Automotive Axles, by far the largest supplier (vis-a-vis competition) of tandom drive axles for the 6X4 MAVs, is expected to be one of the biggest beneficiaries of this structural shift to MAVs.

Subros

Subros prospects are derived largely from demand arising in the Passenger Vehicle (PV) segment, which is currently under pressure due to sluggish demand. This is reflected in Subros valuation too. However, newer growth opportunities are emerging for Subros, owing to increasing customer base on the back of investments by new OEMs entering Indian market. Subros is the market leader in the supply of AC systems to the Automobile OEMs with more than 40% market share. Further with the advent of Tata Nano the market is moving towards producing low-cost high-quality automobiles. As the company enjoys an edge over its peers on back of its strong Order book and technological backing from its two foreign collaborators viz. Denso and Suzuki, the company is all set to grab this opportunity. We estimate Subros to register an EPS of Rs 5.2 in FY2009E and Rs 6.4 in FY2010E.

Geojit Financial Services Views on Midcap Autos - Bosch Ltd, Punjab Tractors

Bosch Ltd

Bosch Ltd is a big player in the auto ancillary industry and is one of the four companies operating under the Bosch Group. With the launch of the Tata Nano and a number of other investments by domestic and foreign auto manufacturers such as General Motors and BMW, the auto parts industry is slated for healthy growth over the next two-three years. Bosch with its variety of business divisions such as Diesel Systems, Gasoline Systems, Chassis Brakes, Automotive Accessories and others stands to gain tremendously from the growth in the passenger car sector. 70% of the company's stock is held by its promoter Robert Bosch GmbH, 20% by FIIs while around 10% is held by the public. The stock, currently trading at Rs.3898.35 (as of Oct.03 2008), has traded at a 52-week high of Rs 5890. Sales growth for the quarter ended June 2008 has been 14.57% year-on-year. Net Profit has grown impressively for the quarter ended June 2008 by 33.77% year-on-year.

Punjab Tractors

Punjab Tractors, which is a subsidiary of Mahindra & Mahindra is engaged in the field of manufacturing, marketing and servicing of tractors and is showing continuous growth for the last quarters on growth in its top line and bottom line figures. Even in the rising inflationary scenario of high raw material prices, company is satisfying its investor expectations, due to its focus on increased retail sales and enhanced retail financing support from Mahindra & Mahindra Financial Services. Sales for the quarter ended June'08 has shown a growth of 81% versus June'07 and a fantastic bottom line growth of 580% respectively. EPS of the company has risen by 583% for the same period. In addition agricultural industry which has been recovered on the farm debt waiver scheme from the union government will boost rapid expansion of company's sales in the coming months. It will be a good bet on Punjab Tractors at current levels.

Religare Securities Views on Larggecap Autos - Hero Honda, Maruti Suzuki

Hero Honda

With two launches already made in first half FY09 and three more variant launches scheduled to occur in the second half, Hero Honda is likely to maintain its market dominance in the two wheeler industry. The company has registered a 27% growth to 305,516 vehicles till date this fiscal and has gained market share in all segments, despite higher interest rate and consequent higher equated monthly installment (EMI) for a retail customer taking a bank loan to purchase a bike. Hero Honda has also announced price hikes across all segments in motorcycles, which consequently has led to a boost in its margin. We expect the company to report a revenue growth of 19% during FY09, aided by volume growth and improvement in realisation per vehicle. The company's move to step up its capacity utilization at its Hardwara, where excise and tax benefits will help improve operating margins going forward as compared to its competitors who would be under margin pressure.

MARUTI SUZUKI

Maruti Suzuki is set to grow on the back of strong performance of its new launches viz. Dzire, SX4 and Swift Diesel. The launch of the A-Star and Splash should further help the volume and will improve price realization. The company's product mix is increasingly getting richer with growth seen in models with higher realizations. The scaling up of the Manesar plant should complete in the third quarter of FY09 and address the concerns on capacity constraints of the more successful models. Exports should be the key driver, with manufacturing agreements with Nissan and Suzuki helping to maintain high capacity utilisation for the recent expansion. We expect exports to grow at a compounded annual growth rate of 90% over FY08-FY10E. The sixth pay panel would be a key driver, as more government employees are likely to buy cars with salary arrears that they would get, we consider this as a near term trigger to sales growth.

SBICAP Securities Views on Smallcap IT Stocks - TAKE Solutions, Megasoft

TAKE Solutions

TAKE leverages management bandwidth and domain expertise to deliver products for niche supply chain management and life sciences. Supply chain management and life sciences are less impacted by US meltdown (compared to banking, financial services and insurance). The company conducts business in 12 countries with more than 300 customers. TAKE has high exposure (64 %) to North America and has to withstand competition from international players. TAKE’s management is optimistic on its growth prospects for the coming years and also looking at inorganic growth initiatives to strengthen its growth prospects. Its non linear model will help deliver 35% revenue compounded annual growth rate for three years. It looks attractive at FY09 P/E of 6x, FY10 P/E of 4x for a company with return on capital employed and return on equity of over 25%.

Megasoft

Megasoft is a domain centric, intellectual property driven, technology solutions company in the telecom and IT sector. The company’s telecom product focus and geographic profile (USA 50%, Europe 25%) reduces the impact of US meltdown and banking, financial services and insurance (BFSI) turmoil. The company has reported revenues of Rs 850 mn and PAT of Rs 121 mn for the quarter ended June 30, 2008 as compared to revenues of Rs 601 mn and PAT of Rs 94 mn in the corresponding quarter last year. The company has high revenue visibility with an order book — 65% CY10 revenues. Trigger comes from value unlocking of its Rs 3 billion real estate (greater than market capitalisation of Rs 2 billion). It has a non-linear model with high offshore revenues (80%). The stock is extremely attractive at CY10 P/E of 2x with good dividend yield.

Invest Shoppe Views on Rolta, Allied Digital Services

Rolta India

The company has strong order book of Rs 1500 crore as on June 2008 with 75% executable over FY09. Of the order book, 55% is domestic and 45% is international. For FY09 the company has guided 23%-24% growth in its earnings post MTM losses. At the current market price, stock trades at 8.9x of FY09E earnings. This makes the stock very attractive, keeping in mind its strong visible growth estimated in all the segments. Since more than 50% of the revenue is from domestic operations and the company does not focus on BFSI Sector, it has limited risk from exchange fluctuations and negligible fear of delay in execution of orders due to the turmoil in international markets. Further, we believe that various JVs in particular their partnership with Stone and Webster for exploiting opportunities in the nuclear power space seems very promising for the long run.

Allied Digital Services

Allied Digital Services (ADSL) is riding on high-growth domestic markets of system integration (SI), IT infrastructure management services (IMS) and remote infrastructure management (RIM). RIM is expected to be $13-15bn opportunity for the Indian IT industry by 2013 from the current US$3.6bn, as per the latest Nasscom and McKinsey report. Recent acquisition of EnPointe Global Services (EGS), the US-based IMS provider, marks ADSL’s foray into international markets. Strong revenue visibility, changing business mix, improving margins and higher return ratio make it a good investment bet. We expect 60%-70% compounded annual growth rate in earning per share over the next three years. At the current market price, stock trades at 11x and 6.8x of FY09E and FY10E earnings, which makes it quite an attractive investment bet

SMC Global Views on Large Cap IT Stocks - Infosys, TCS

Infosys

Infosys is the leading software company in India and is held in high esteem by clients and competitors alike. The company has a global footprint with over 40 offices and development centres in India, China, Australia, the Czech Republic, Poland, the UK, Canada and Japan. The company's stock quotes below 15 times trailing FY08 EPS hence offer margin of safety for long-term investor. The company is virtually debt-free hence insensitive to rising interest rates. Funding won't be problem for Infosys due to under leveraged balance sheets and positive free cash flow generation capacities, which is evident from Infosys' cash offer for buying AXON Group Plc, for a consideration of $753 mn. The appreciation of Dollar against Indian Rupee is a very healthy sign for the IT sector in the current environment. The company is on track to meet the volume growth guidance for the fiscal.

TCS

At current levels, the company generate positive free cash flow for an investor. We believe in these testing times, Tata Consultancy Services can widen their product portfolio through inorganic route. For instance, TCS acquired Citigroup captive catering to banking, financial services and insurance (BFSI) clients for Rs 2,272 crore. TCS had guided for gross employee additions of 30,000-35,000 employees for FY2009 at the end of FY2008. It has maintained this target, signifying confidence in its ability to win more deals and drive growth. The unchanged hiring target is an encouraging sign. Further, TCS is expected to incur minimum losses on account of forex due to conservative hedging practices. It is an attractive bet as the current valuations factor in the worst and downside from the current stock price is limited.

Stock Views on Hindustan Zinc, Nestle, Jaiprakash Associates

CITIGROUP on Hindustan Zinc

CITIGROUP has downgraded Hindustan Zinc’s (HZL) rating to ‘sell’ by reducing the target price to Rs 430 on the back of an earnings cut of 22% for FY09 and 27% for FY10. Citigroup’s new estimates incorporate changed zinc and lead forecasts, updated trends in rupee-dollar exchange rates and small changes in volumes based on management feedback. Zinc prices are expected to fall 41% year-on-year (y-o-y) in FY09, further fall 10% y-o-y to reach a bottom in FY10, and recover thereafter in FY11. HZL enhanced its zinc capacity by 88,000 tonnes per annum (tpa) to 669,000 tpa in April ’08 (total zinc-lead capacity to 755,000 tpa). In addition, HZL has announced further capital expenditure (capex) to enhance zinc capacity by 210,000 tpa and lead capacity by 100,000 tpa — taking the total to 1.07 million tpa by ’10, together with additional mining and captive power capacities. Citigroup sees a fall in earnings and EBITDA margins despite positive factors for HZL, such as its status as one of the lowest-cost producers globally, strong zinc volume growth (20% in FY09E and 40% in FY10E), high realisations for by-products like sulphuric acid, and savings from commissioning of captive power.

EDELWEISS on Nestle

EDELWEISS initiates coverage on Nestle with an ‘accumulate’ recommendation. Nestle is expanding into tier-II and III cities by introducing stock-keeping units (SKUs) below Rs 10. Also, its turnover from innovations/renovations, positioned on the health and wellness platform (priced at a substantial premium to existing products) has increased fivefold over the past few years. The turnover is expected to remain at high levels, going forward, on the back of the company’s strong product pipeline. At the current market price, the stock is trading at P/Es of 28.9x and 23.5x to CY08E and CY09E earnings, respectively. Nestlé is trading near the upper end of its recent band of 23-27x forward earnings. Edelweiss believes these levels are sustainable, given Nestlé’s strong growth and defensive nature of its business. Amidst volatile capital market conditions, the stock looks attractive over the long term. Edelweiss has valued Nestle at 26x CY09E earnings, which results in a target price of Rs 1,830. It expects Nestlé’s earnings to witness a compounded annual growth rate (CAGR) of 25.5% over CY07-09E.

MERRILL Lynch on Jaiprakash Associates

MERRILL Lynch has maintained a ‘buy’ rating on Jaiprakash Associates (JPA), but has reduced the target price to Rs 335 from 395. This is because it has reduced the value of Yamuna Expressway due to indefinite delay in the proposed Greater Noida International Airport, higher expressway cost and lower real estate realisations till FY11E. This can impact development of realty at three (3,750 acres) of the five land parcels (6,250 acres) of JPA’s Yamuna Expressway located in and around Noida airport. Hence, Merrill Lynch has removed these parcels from the valuations till visibility emerges. It has also factored in a higher cost of the expressway at Rs 7,400 crore on higher land/construction costs and lower realisation assumptions on the Noida land bank till FY11E on continued weakness in the realty market in National Capital Region (NCR). Key triggers are: a) Improved macro situation — lower inflation/rates; b) Execution of power/infrastructure projects on time; and c) Monetisation of realty land bank.

Stock Views on State Bank of India, Lanco Infra, Titan Industries

MOTILAL Oswal on SBI

MOTILAL Oswal maintains ‘buy’ rating on State Bank of India (SBI). The bank’s rural and agri-business unit comprises: (1) all the business done at its rural and semi-urban branches; and (2) agriculture business done at any branch. SBI has 7,100 branches in rural and semi-urban areas which account for ~70% of its total branch network strength. About 50% of its employees work in the agri-rural business (ARB) division. The bank’s ARB loan book is currently more than Rs 1 trillion; this accounts for ~23% of SBI’s total loan book and ~28% of its domestic loan book. About 45% of these are farm loans. ARB deposits stand at ~Rs 1.7 trillion and account for ~30% of SBI’s deposits. SBI’s ARB loan and deposits account for 21-22% of the industry, while its ARB branch network accounts for 13% of the industry. SBI is consistently gaining market share in this segment. Motilal expects the bank to report consolidated earnings per share (EPS) of Rs 155 in FY09E and Rs 187 in FY10E. Consolidated book value (BV) will be Rs 1,110 in FY09E and Rs 1,282 in FY10E. Return on assets (RoA) and return on equity (RoE) are expected to be ~1% and 15-16%, respectively, over the next two years. Adjusted for value of SBI Life at Rs 205/share, the stock trades at 1x FY10E consolidated BV.

UBS Investment on Lanco Infratech

UBS Investment has upgraded its rating on Lanco Infratech to ‘buy’, but has reduced the target price by 28% to Rs 250. It has also cut its EPS estimates by 10%/20%/19% to Rs 19/22.4/33.3 for FY09/10/11E to reflect a slowdown in project execution. It has factored in a 10% discount to power, EPC (engineering, procurement & construction) and infrastructure valuations. The contributions to value are from power (44%), EPC (40%) and real estate (15%). The stock is trading at 9.5x FY09E EPS, which is a good buying opportunity. The key risks are fuel availability, execution and a further slowdown in the real estate sector.

JP Morgan on Titan Industries

JP MORGAN maintains ‘overweight’ rating on Titan Industries with a March ’09 target price of Rs 1,475 based on a forward price-to-earnings (P/E) multiple of 23x. The company has seen a revival in demand for its watches and jewellery, post-June ’08. It continues to maintain its previous guidance of 33% growth in revenue to Rs 4,000 crore and similar profit growth for FY09. Specialty and lifestyle retailing will remain the company’s core focus as there are many organic growth opportunities in a nascent market like India. Titan aims to add 750 stores over the next five years, but it has no immediate plans to expand its international business. Several initiatives in the jewellery and watch businesses should help to sustain good growth over the next 1-2 years. Goldplus, Golden Harvest Scheme and innovative collections such as ‘Jodhaa Akbar’ should support double-digit volume growth in the jewellery business. The company has planned exciting new launches in the watch segment, such as a new children’s brand and automatic watches, over the next 6-9 months. Prospects of the eyewear business look encouraging and the company plans to add 60 stores in the next one year and 200 stores over the next three years. It is targeting sales growth of 50% through its own brands to improve margins. JP Morgan feels Titan is the best proxy for attractive growth opportunities in the specialty retail space.

Related Feature

Stock Views on Shiv-Vani Oil& Gas,

BNP PARIBAS on Shiv-Vani Oil& Gas

BNP Paribas maintains ‘buy’ rating on Shiv-Vani Oil & Gas, while reducing the target price from Rs 800 to Rs 522 on higher borrowing costs and multiple contractions. The company’s global peers trade at a forward P/E of 10.5x, compared to Shiv-Vani’s 8.4x (based on FY10 EPS estimates). Global peers are likely to expand at 23% from FY08-FY10, while Shiv-Vani is set to grow 58%. BNP Paribas believes oil service companies will continue to see strength in their core businesses, despite weak sentiment surrounding crude. Shiv-Vani’s receivables rose by 158% to Rs 276 crore, which comprised 48% of its FY08 revenue. Since over 85% of Shiv-Vani’s revenue comes from ONGC, this raises concerns on the company’s working capital management. BNP Paribas believes Shiv-Vani will need to raise cash to fund its working capital needs in the near term and hence, will see an increase in its cost of borrowing.

EDELWEISS on Opto Circuits

EDELWEISS maintains ‘buy’ recommendation on Opto Circuits. The company cancelled the proposed $100-million acquisition of an European company as the demanded price was not justifiable from an economic value perspective. Over the past few years, Opto has created strategic and shareholder-value by focusing on inorganic opportunity for growth, be it in the Advanced Micronic Devices acquisition in ’01, Palco Labs and the thermometer division of HUL in ’02, Mediaid in ’03, EuroCor in ’05, or the recent Criticare Systems acquisition in ’08. This shows the management’s focus on value creation. After the recent correction in stock price, the valuations offer a good buying opportunity. Opto has traded at a premium to the market due to high growth, healthy margins and upside from potential acquisitions. But with the recent market fall and overhang of large ownership by FIIs, the stock price has corrected more-than-warranted, making it attractive.

Stock Views on NTPC, Cairn India, Lanco Infra

GOLDMAN Sachs on NTPC - TARGET PRICE: RS 208

GOLDMAN Sachs Research has initiated coverage on the stock with a ‘buy’rating, saying NTPC’s business model entails a high degree of earnings visibility with core business consistently yielding 20% plus return on equity(RoE). “NTPC scores well as a defensive growth op-tion. It has the lowest risk to funding amongst its peers, competitive cost of generation, RBI guarantee for payment realisation from its customers (financially-constrained SEBs) up to FY2016 and inexpen-sive valuations,” said Goldman Sachs Research in a note to its clients. The firm expects the company’s net profit to grow at a compounded annual rate of 7.3% between FY2008 and FY2011E (estimated).

Macquarie on Cairn India - TARGET PRICE: RS 276

Macquarie Research has reaffirmed its ‘outperform’ rating on the stock, but has cut the target price by 1.4% to Rs 276 due to the change in 2008 West Texas Intermediate (WTI) forecast. “We have revised down the WTI crude oil price forecast by 6.3% for 2008. Our new forecast has the 2008 figure adjusted down to reflect the recent weakness in prices and the risk that slowing demand growth keeps prices in a range of $100-110/bbl (blue barrel),” said Macquarie in a note to its clients.

UBS Securities on TARGET PRICE: RS 250

UBS Securities has upgraded its rating on the stock to ‘buy’from ‘sell’, but has trimmed the price target to Rs 250. The firm has cut its earnings per share(EPS) estimates for the stock by 10%/20%/19% to Rs 19/22.4/33.3 for FY09/10/11E to reflect a slowdown in project execution. It has also made of 10% discount to the power, engineering procurement and construction (EPC) business and infrastructure valuation for the company. “

Stock Views on Infosys, Gail, ICICI Bank

JP Morgan on Infosys - TARGET PRICE: RS 1,825

JP Morgan Research has assigned an ‘overweight’ rating to the stock saying Infosys has reported good 2QFY09 results ahead of consensus. “We have a positive view on the sector, given our belief in secular offshoring trend but do accept that weak guidance would put pressure on Infosys and the sector near-term,” said the research firm in a note to its clients. According to the research firm, the weak guidance will raise fears about FY10E (estimated) rather than the next couple of quarters as the Indian IT sector might face a lot more pressure in 2009/FY10 from customers. “While consensus numbers might not change for FY09 (due to continued rupee/US$ depreciation), FY10 estimates might be cut. We believe that any panic sell-off on back of this guidance remains a good entry point,” the note said.

Morgan Stanley on Gail - TARGET PRICE: RS 347

Morgan Stanley has given an ‘overweight’ rating to the stock saying it is trading at 9.8 times F2009E (estimated) EPS (earnings per share) and 8.8 times F2010E EPS, which is a 30-35% discount to global peers. “We rate Gail a mustown stock in today’s environment — it has high quality assets, which are not easily replicable giving it a virtual mo-nopoly. It is net cash positive equal to 35% of its asset base; and its earnings are reasonably defensive, especially from its transmission business,” said Morgan Stanley in a note to its clients. According to Morgan Stanley, the company is best positioned to take advantage of higher supply of natural gas, which is expected to increase by 150% over the next four years.

Edelweiss Securities on ICICI Bank - TARGET PRICE: 779

Broking house Edelweiss Securities has reiterated a ‘strong buy’ on the stock saying it has corrected 26% vs 18% for Bankex and the general market correction of 16%. “Current prices seem to be completely ignoring value of subsidiary and moreover implying wild assumptions about asset quality (which appears highly improbable),” said Edelweiss in a note to its clients. “Even if we make a worse case assumption on all the various possible parameters (none of which is probable), the stock offers substantial value at these levels,” the note said. The broking house asserts that book value (BV) of Rs 417 does not take into account any valuations for the subsidiaries. “If we add subsidiary valuations (of Rs 220 per share in FY09E) to the adjusted BV, the fair value will be 50-75% higher than the current price. This represents a strong return to investors in the short-term itself,” the Edelweiss note said.

Srock Views on ABG Shipyard, Bombay Rayon

Asit C. Mehta on ABG Shipyard - Target Rs 365

Asit C. Mehta has recommended a buy rating on ABG Shipyard, with a price target of Rs 365, in its report dated 30 September, 2008.

"Considering the opportunities in the offshore E&P, ABG’s current order book and expansion plans, we expect its sales (excluding subsidy) to grow at a CAGR of 50% and PAT to grow at a CAGR of 38 % from FY08 to FY10E. At the CMP of Rs 299, ABG is trading at 12.6x its FY09E EPS (excluding subsidy) and 7.4x its FY10E EPS (excluding subsidy). We initiate coverage on ABG Shipyard Limited with BUY recommendation and a target price of Rs 365, which is equivalent to a forward P/E of 9x to its FY10E EPS of Rs 40.6 (excluding subsidy)," says Asit C. Mehta's report.

Motilal Oswal on Bombay Rayon - Target Rs 566

Motilal Oswal has maintained its buy rating on Bombay Rayon Fashions with a target of Rs 566 in its September 22, 2008 research report. "We continue to value Bombay Rayon’s manufacturing operations at 12x FY10E EPS of Rs 37 to arrive at a value of Rs 444. We value the GURU retailing business based on DCF at Rs 122 per share. The SOTP target price for Bombay Rayon works out to Rs 566, and offers 68% upside from current levels. We maintain Buy," says Motilal Oswal's research report.

Stock views on Tulip Telecom, HCC, Sintex Inds

Prabhudas Lilladher on Tulip Telecom - Target of Rs 1336

Prabhudas Lilladher has maintained its buy rating on Tulip Telecom with a target of Rs 1336 in its September 25, 2008 research report. "At the ruling market price of Rs 937, the stock trades at 11.3x FY09E EPS of Rs 82 and at 9.1x FY10E EPS of Rs 102. We remain positive on the future growth prospects of Tulip and maintain BUY rating on the stock, target of Rs 1336," says Prabhudas Lilladher's research report.

Angel Broking on HCC - Target Rs 117

Angel Broking has maintained its buy rating on Hindustan Construction Company (HCC), with revised price target of Rs 117, in its report dated September 27, 2008.

"The HCC stock is trading at attractive levels with an extremely positive risk-reward ratio despite negatives like a high interest rate regime, dip in Margins and reduced valuations for Real Estate. We remain positive on HCC and believe that HCC’s stock will fetch attractive returns if the Lavasa project turns out to be a success over a period of time. We have valued HCC on SOTP basis. We have assigned a revised PE of 10x FY2010E Earnings (12x assigned earlier) for its core Construction business on account of the current market turmoil and expected slowdown in growth and have valued it at Rs 59/share. The Real Estate business, on NAV basis, fetches Rs 53/share. The Road BOT segment has been valued on DCFE basis at Rs 5/share. At Rs 81, the stock is attractively trading at 9x FY2009E and 4x FY2010E Earnings post adjusting for BOT and Real Estate. We maintain a Buy on the stock, with a revised Target Price of Rs 117 (Rs 140)", says Angel Broking report.

Reliance Money on Sintex Indstries - Target Rs 364

Reliance Money has recommended a buy rating on Sintex Industries, with price target of Rs 364, in its report dated October 1, 2008.

"We recommend a BUY on Sintex Industries Ltd (Sintex), a well diversified company having strong domain expertise in range of plastics and concentrates on the niche segment of textiles business. Sintex is a market leader in the plastics processing industry, which has been growing at scorching pace through both organic and inorganic route, with net profit CAGR of around 36% for FY06-08A. Sintex, over the years, leveraged its established market dominance in water tanks (70% share) to tap other higher-margin segments. Going forward, we expect Sintex's revenue and profit would grow at a CAGR of 46% and 43% respectively during FY08-FY10E, boosting EPS to Rs 25.2 in FY09 and Rs 32.6 in FY10 from Rs 15.7 in FY08," says Reliance Money report.

Stock views on IVRCL, Suzlon Energy

Citigroup on Suzlon Energy

Citigroup Global Markets has maintained its ‘sell’ rating on the stock saying the company’s international expansion drive has taken its toll in the form of supply delays; tower shortages in the international markets; key component shortages; and negative effects of foreign currency movements and nacelle custom duty changes in the US. According to Citi, mediumterm like commodity price increases; delays in Suzlon’s WTG capacity ramp-up; the possibility of PTC not being extended; and further provisions for blade damage problems may weigh heavily on the stock’s performance. “The target price is based on 17 times December ’09E EPS (earnings per share), the low end of Suzlon’s 05-08 P/E (price to earnings) range of 17-47 times, given concerns about Suzlon’s S88 WTG,” said Citi in a note to its clients. “The recent EME (Edison Mission Energy) order cancellations and availability issues have taken the stock to its trough valuation of 17 times oneyear forward earnings,” the note said.

Prabhudas Lilladher on IVRCL

Broking house Prabhudas Lilladher has maintained its ‘buy’ rating on the stock saying stock is attractively valued at 14.5 times FY09 (estimated) earnings and 11.2 times FY10E earnings at the current market price. “We expect the company to register a CAGR (compound annual growth rate) of 32% and 25% in revenues and PAT (profit af-ter tax), respectively, for FY08-10(estimated),” said the broking house in a note to its clients. According to the broking outfit, a substantial order book growth would be the primary driver of revenues for the company. “The order book as on May 2008 stood at Rs 12,200 crore (year on year growth of 71%) as against Rs 7100 crore. On account of focus on cash contracts, IVRCL enjoys a healthy order book position amongst the peers,” the note said. IVRCL has improved upon its Sales/WC (working capital) ratio at 1.9 times as against 1.7 times in FY07 and is expected to maintain the same, says the broking house.

Stock Views on Power Grid, Nitin Fire, Dabur India

Indiabulls Securities on Power Grid - Target of Rs 110

Indiabulls Securities Research has initiated a buy rating on Power Grid Corporation of India with a target of Rs 110 in its September 23, 2008 research report. "At the current market price of Rs 91.10, the Company is trading at a price to book multiple of 2.73x. Our valuation model gives us a target price to book multiple of 3.29x and a estimated fair value of Rs 110. We have assumed a discount rate of 9.25%. Our target price shows an upside of 21% from the current price. We therefore initiate coverage with a BUY rating," says Indiabulls Securities' research report.

HDFC Securities on Nitin Fire - Target of Rs 525

HDFC Securities has maintained its buy rating on Nitin Fire Protection Industries with a target of Rs 525 in its September 24, 2008 research report. "Revenues and profits of the company are expected to grow at a CAGR of 58% and 66% over FY08 to FY10E. At the CMP of Rs 271, it is trading at 8.2(x) and 6.4(x) its FY09E and FY10E FDEPS. We have calculated a DCF based target price of Rs 525, an upside of 94% from current levels. We maintain our BUY rating on the stock," says HDFC Securities research report.

Hem Securities on Dabur India - Target of Rs 110

Hem Securities has initiated a buy rating on Dabur India with a target of Rs 110 in its September 23, 2008 research report. "Presently, the stock is trading at times to its earnings and times to its book value. We initiate a 'BUY' signal on the stock with a target price of Rs 110 in the medium term investment horizon expecting an appreciation of 25% from CMP of Rs 87," says Hem Securities' research report

Stock views on Nava Bharat Ventures, Redington, NIIT

Hem Securities on Nava Bharat Ventures - Target of Rs 280

Hem Securities has maintained its buy rating on Nava Bharat Ventures with a target of Rs 280 in its September 22, 2008 research report. "The company posted excellent financial figures for the quarter ended June 2008. The net sales for the company gone up by 64.77% to Rs 2904.77 million for the Q1FY09 as against the net sales of Rs 1762.91 million for the Q1FY08.Since the stock seems to offer extremely good investment opportunities, we initiate a ‘BUY’ signal on the stock with a target price of Rs 280 in medium term investment horizon expecting an appreciation of about 28% from the current level,” says Hem Securities’ research report.

India Capital Markets on Redington - Target Rs 325

India Capital Markets has recommended a buy rating on Redington (India) (RDIL) with a target of Rs 325 in its September 23, 2008 research report. "RDIL is currently trading at a P/E of 13 on FY09E earnings with a PEG of 0.9. An important aspect to note is that the projected growth is only for the established business of RDIL & doesn’t include contribution from NBFC & proposed ADC. We initiate coverage on the company with a BUY recommendation, with a Target Price of Rs 325," says India Capital markets' research report.

Emkay Global on NIIT - Target of Rs 132

Emkay Global Financial Services has maintained its buy rating on NIIT with a target of Rs 132 in its September 22, 2008 research report. "We highlight that the company remains sound on achieving the earlier envisaged financial targets for FY09 (our growth and margin assumptions for the business segments are lower than company’s internal targets). We would look to review our ratings and target price post Q2FY09 results; however believe that there is little risk to our FY09 earnings estimates of Rs 5.4. Maintain BUY with a price target of Rs 132," says Emkay Global Financial Services' research report.

KRChoksey Views on Tata Consultancy Services, GSK Consumer, Infosys

Tata Consultancy Services - Target of Rs 989

KRChoksey Research has recommended a buy rating on Tata Consultancy Services with a target price of Rs 989 in its September 12, 2008 research report. "Currently IT companies are trading at 13-15x FY09E earnings, which is much below their trading multiples of 30x in Dec’06. We believe that investors’ short term focus on cross currency movement is unwarranted. We also expect investors to shift focus on absolute growth rates and USD/INR currency movements in medium term. We therefore continue to maintain our view on IT sector," says KRChoksey's research report.

GSK Consumer - Target of Rs 781

KRChoksey Research has recommended a buy rating on GlaxoSmithKline Consumer Healthcare with a 12-month target price of Rs 781 in its September 19, 2008 research report. "At the CMP of Rs 619, the stock is trading at 14.4x TTM EPS of Rs 43.0. Going forward, we believe the company is expected to see strong performance driven by leveraging its flagship brand Horlicks and aggressive plans of new launches. We initiate coverage on the stock with a Buy rating and a 12-month target price of Rs 781, implying an upside potential of 26% which is arrived by discounting CY09E EPS of Rs 52 by 15x," says KRChoksey's research report.

Infosys - Target of Rs 2079

KRChoksey Research has recommended a buy rating on Infosys Technologies with a target price of Rs 2079 in its September 12, 2008 research report. "Currently IT companies are trading at 13-15x FY09E earnings, which is much below their trading multiples of 30x in Dec’06. We believe that investors’ short term focus on cross currency movement is unwarranted. We also expect investors to shift focus on absolute growth rates and USD/INR currency movements in medium term. We therefore continue to maintain our view on IT sector," says KRChoksey's research report.

Angel Broking Views on Subros, TV Today, Lanco Infratech

Subros - Target of Rs 42

Angel Broking has recommended a buy rating on Subros with 12-month price target of Rs 42, in its report dated September 12, 2008.

"Subros is the market leader in the supply of AC systems to the Automobile OEMs. The company enjoys an edge over its peers owing to its strong Order book and technological backing from its two foreign collaborators. We estimate Subros to register an EPS of Rs 5.2 in FY2009E and Rs 6.4 in FY2010E. At the CMP, the stock is trading at 5.8x FY2009E and 4.7x FY2010E EPS. We maintain a Buy on the stock, with a Target Price of Rs 42", says Angel broking report.

TV Today - Target of Rs 117

Angel Broking has recommended a buy rating on TV Today Network with a target of Rs 117 in its September 12, 2008 research report. "TV Today Network (TVTN), a focused News broadcaster with a strong bouquet of four news channels, has maintained its leadership in the News Genre over seven consecutive years. Revamped Headlines Today, merger of Radio Today, flow of subscription Revenues and new channel launches would be the key drivers affecting the TVTN stock performance in the ensuing quarters. At the CMP of Rs 91, TVTN is trading at attractive valuations of 8.5x FY2010E Earnings making it the cheapest stock in the Broadcasting space. Moreover, we believe the company's recent buyback announcement would lend downside support to the stock. We Initiate Coverage on the stock, with a buy recommendation and target price of Rs 117," says Angel Broking's report.

Lanco Infratech - Target of Rs 413

Angel Broking has initiated a buy rating on Lanco Infratech with a target of Rs 413 in its September 12, 2008 research report. "We estimate Lanco's Top-line to grow at a CAGR of 95% over FY2008-10E, while Margins are expected to stablise at 16.0% levels by FY2010E. Bottom-line is estimated to post a CAGR of 47% in the mentioned period. At Rs 291, the stock is trading at attractive valuations. We have arrived at a SOTP Target Price of Rs 413 valuing Lanco's core C&EPC business at Rs 175 (9 x FY2010E EPS), Power business at Rs 175 (on DCFE and/or P/BV basis), BOT business at Rs 14 (on DCFE basis) and Real Estate arm at Rs 49 (on NAV basis). We Initiate Coverage on the stock, with a Buy recommendation," says Angel Broking’s research report.

Emkay Global Views on Aban Offshore, Infosys, Nagarjuna Construction

Aban Offshore - Target of Rs 3868

Emkay Global Financial Services has recommended a buy rating on Aban Offshore, with a price target of Rs 3868, in its report dated September 16, 2008.

"At current levels, Aban is discounting its FY2010E earnings by 5.1X, which is a significant 24% discount to the valuations commanded by global drilling majors. However, we believe that Aban’s valuation does not adequately capture Aban’s steeper earnings growth of 123% CAGR (even after the earnings downgrade) as compared to 17% CAGR for its global peers and its superlative RoE of 48% as compared to 24% for global peers. At 5.1X FY2010E earnings, Aban’s valuations are extremely compelling and it more than adequately factors possible softening in Jack up day rates. We continue to believe that the global offshore drilling industry fundamentals are still robust and believe that Aban is the best pick among domestic players. We maintain our BUY recommendation on the stock with a revised price target of Rs 3868 (earlier target of Rs 5400)," says Emkay Global Financial Services' research report.

Infosys - Target of Rs 1836

Emkay Global Financial Services has recommended a hold rating on Infosys Technologies with a target of Rs 1836 in its September 12, 2008 research report."Although the rapid appreciation of the USD V/s the GBP and Euro would impact Infosys’s USD term revenue growth (we estimate that Infosys’s FY09 revenue growth guidance of 19-21% YoY growth could be negatively impacted by 250 bps and Infosys could report USD revenue growth of 18.3% V/s our estimates of 20.8% currently). However Infosys’s earnings estimates could still be upgraded by 4.9% and 4.5% for FY09 and FY10 respectively to Rs 107.2 and Rs 122.6 (if we were to base the estimates at Rs 45/USD for FY09 and Rs 44/USD for FY10 respectively)," says Emkay Global's research report.

Nagarjuna Construction - Target of Rs 154

Angel Broking has maintained its buy rating on Nagarjuna Construction Company with a target of Rs 154 in its September 16, 2008 research report. "Nagarjuna Construction Company (NCC) is on track to emerge as a diversified infra heavyweight with SPVs and Real Estate accounting for 20% of our sum-of-the-parts (SOTP) target price. It is also diversifying into the Metals, Oil and Gas and Power sectors. At Rs113, the stock is trading at valuations of 7.7x FY2010E EPS of Rs 9.5 post adjusting for the BOT projects and Real Estate, which is attractive in view of the good order book position (Rs 14,500 cr) and positive outlook on the Infrastructure sector. We have arrived at a SOTP target price of Rs 154 valuing NCC's core construction business at Rs 114 (12 x FY2010E EPS), BOT business at Rs 18.7 and Real Estate arm at Rs 20.6. We maintain a buy on the stock, with a revised 12-month target price of Rs 154," says to Angel Broking report.

Stock Views on Idea Cellular, Marico, Bharti Airtel

IIFL on Idea Cellular - Target of Rs 112

IIFL has recommended a buy rating on Idea Cellular with a 12 month target of Rs 112 in its September 18, 2008 research report. "Idea Cellular is yet to receive the USD 640 million investment from the private-equity deal done in May this year, and the rupee’s depreciation against the USD will result in a gain exceeding Rs 2 billion for Idea. In FY08, Idea managed its FX exposure better than peers. Idea also sported the best asset turnover, highest depreciation rates and the highest ROE among the big carriers. It raised its market share in FY08 from 8.4% to 9.2% in terms of share of wireless subscribers."

"While minutes of usage increased by 5%, the rate per minute fell by 15%, resulting in a 12% drop in ARPU to Rs 299. At 54%, Idea’s YoY revenue growth rate was equal to that of Bharti. We build in higher cost of imports over the next 2 years and raise WACC to 14% and reduce our DCF target price from Rs 141 to Rs 112. BUY," says IIFL's research report.

Parag Parikh on Marico - Target of Rs 82

Parag Parikh Financial Advisory Services has recommended a buy rating on Marico Industries with a target of Rs 82 in its September 11, 2008 research report. "At the current market price of Rs 58.25 , the stock trades as 16x of FY09 earnings and 14x of FY10 earnings. This seems grossly under priced and a value pick. PPFAS research expects the stock to reach a level of Rs 82 within 18 months to trade at 20x on projected earnings of FY10E. Thereby we rate the stock as a BUY giving an upside of 40%, target of Rs 82," says Parag Parikh Financial Advisory Services' research report.

India Infoline on Bharti Airtel - target Rs 908

India Infoline has recommended buy rating on Bharti Airtel, with a price target of Rs 908, in its report dated September 15, 2008.

"Over the past 12 months DoT has granted spectrum to several new players, which are likely to start operations, aided, partly, by faster network roll out due to infrastructure sharing. However, we believe Bharti is well placed to maintain its leadership position with a strong pan India presence and a 75 million subscriber base and forecast a 36.1% CAGR in earnings over FY08-10E. Valuations appear attractive at EV/EBIDTA of 8.4x and P/E of 12.8x on our FY10E earnings; recommend BUY with a target price of Rs 908", says India Infoline report.

SBICAP Securities Views on IDFC, Patel Engineering, Piramal Healthcare

Piramal Healthcare - Target 360
SBICAP Securities has maintained its buy rating on Piramal Healthcare with a target of Rs 360 in its September 16, 2008 research report. "We value PIHC using a range of approaches including DCF and relative approaches. We use relatives to set our target valuation of Rs 360 based on a sum-of-parts PE approach on weighted average EPS of Rs 22.10 (FY09-10); implying an exit PE multiple of 17.4x and 14.9x over the FY09 and FY10 EPS of Rs 20.64 and Rs 24.13 respectively, Buy," says SBICAP Securities' research report.

Patel Engineering - Target 490

SBICAP Securities has recommended a buy rating on Patel Engineering Company with a target of Rs 490 in its September 17, 2008 research report. "At the current price of Rs 370, assuming full tax rate of 33%, the stock trades at a P/E multiple of 17.4x its FY09E consolidated EPS of Rs 21.2 and at 14.3x its FY10E consolidated EPS of Rs 25.9. On an EV/EBIDTA basis, it trades at 8.8x FY09E and 7.7x FY10E. We value the real estate subsidiary at Rs 185 per share, BOT subsidiaries at Rs 13 per share and assign a conservative 12x P/E multiple to its core construction business's standalone FY10EEPS of Rs 24.4. Thus,arriving at an SOTP value of Rs 490 per share (an upside of 32% from the current level),we recommend a BUY on the stock," says SBICAP Securities' research report.

IDFC - Target 360

SBICAP Securities has maintained its buy rating on Infrastructure Development Finance Company (IDFC) with a target of Rs 104 in its September 16, 2008 research report. "IDFC has evolved as a diversified financial institution in the infrastructure finance segment with two major acquisitions of SSKI Securities (79.8%) and the Standard Chartered Mutual Fund (100%). IDFC's private equity business continues to scale up rapidly with assets under management expected to triple to USD 2.3 bn. by the end of this fiscal."

" Despite the diversification, much of IDFC's revenues continue to flow from the project finance business. We believe that except for the mutual fund business, the other businesses are more or less likely to grow at similar rates. We value IDFC using the SOTP methodology and arrive at a target price of 104. We initiate coverage with a BUY rating.," says SBICAP Securities' research report.

Emkay Global Views on CRISIL, ICRA, Sterlite Industries

Emkay Global Financial Services on CRISIL - Target of Rs 4150

Emkay Global Financial Services has recommended a buy rating on Credit Rating Information Services of India (CRISIL) with a target of Rs 4150 in its September 26, 2008 research report. "At CMP, the stock trades at 14.4x CY09E EPs. With strong earnings growth of 41% over CY07-09E and core RoE of 42%, we believe that CRISIL is an excellent investment opportunity. We have valued CRISIL at 18x CY09E EPS, giving a target price of Rs 4150, Buy," Emkay Global Financial Services' research report.

Emkay Global Financial Services on ICRA - Target of Rs 750

Emkay Global Financial Services has recommended a buy rating on ICRA with a target of Rs 750 in its September 26, 2008 research report. "At CMP, stock trades at 14.1x FY09E and 10.4x FY10 EPS. We expect its core RoE to improve to 27% in FY10 from 24% in Fy08. We therefore assign a target P/E multiple of 14.2x, over the company's FY10 EPS. Based on this multiple, we value ICRA stock at Rs 750, Buy," says Emkay Global Financial Services' research report.

Emkay Global Financial Services on Sterlite Industries - Target of Rs 637

Emkay Global Financial Services has maintained its buy rating on Sterlite Industries (India) with a target of Rs 637 in its September 26, 2008 research report. "Currently Sterlite is trading at EV/EBITDA of 2.4x our FY10 estimates, which includes assumptions of buyout of HZL and BALCO stake. At our target price, Sterlite will trade at EV/EBITDA of 3.2x FY10 estimates, a discount of almost 15% to the global base metal companies. We maintain BUY on the stock with revised target price of Rs 637 with an upside of 34% from the current level," says Emkay Global Financial Services' research report.

Stock Views on Pidilite Industries, Welspun Gujarat, Jindal Saw

SKP Securities on Pidilite Industries - Target of Rs 195

SKP Securities has recommended a buy rating on Pidilite Industries with 18 months price target of Rs 195 in its September 27, 2008 research report. "At the current level of Rs 135, Pidilite is trading at the P/E of 15.48x, 12.02x and 10.14x of FY09E, FY10E and FY11E earnings of Rs 9, Rs 11 and Rs 13 respectively. Considering the strong brand value and steady growth we initiate coverage on Pidilite with 18 months price target of Rs 195 (44% upside) which discounts FY11E earnings by 15x, Buy," says SKP Securities' research report.

HDFC Securities on Welspun Gujarat - Target of Rs 592

HDFC Securities has maintained its buy rating on Welspun Gujarat Stahl Roh with a revised target of Rs 592 in its September 30, 2008 research report. "On a relative value basis, the stock is currently trading at 7.2x and 4.6x its expected FY09E and FY10x earnings. We expect it to re-rate positively and when coupled with the underlying earnings growth, should deliver significant out performance to investors in the long term."

"We therefore maintain our Strong BUY recommendation on the stock with a revised target price of Rs 592 (upside of 159%) from the earlier target of Rs 774 (Downward revision of 24%). This downward price target is partially due to our revised earnings estimates and also due to the derating in P/E multiple of the company and the market," says HDFC Securities' research report.

HDFC Securities on Jindal Saw - Target of Rs 987

HDFC Securities has given target of Rs 987 for Jindal Saw in its September 18, 2008 research report. "Going forward, the company has embarked upon an aggressive capex plan in the pipe space. It also plans to invest in new unrelated businesses (shipyard, Infrastructure etc), which remains a concern to us. The stock currently trades at a P/E multiple of 10.3x CY08E and 7.3x CY09E, with marginal downward revision of our estimates for CY08E and CY09E. We are revising our price target to Rs. 987 (Upside of 67%) from earlier price target of Rs.1050 (Downward revision of 6%). We expect the stock to re-rate positively once its expanded capacities come on stream and start contributing to profits," says HDFC Securities' reports.

Stock Views on Ranbaxy Laboratories, Rain Commodities, Lupin

Angel Broking on Ranbaxy Laboratories - Target of Rs 500


Angel Broking has maintained its buy rating on Ranbaxy Laboratories with a target of Rs 500 in its September 18, 2008 research report. "we remain positive on Ranbaxy in the long term and maintain a Buy on the stock with a SOTP Target Price of Rs 500, wherein the core business fetches Rs 365 and Rs 135 would account for the FTF opportunities and cash lying on the Balance Sheet," says Angel Brokings' research report.



PINC Research on Rain Commodities - Target of Rs 300


PINC Research has recommended a buy rating on Rain Commodities with 12-month target of Rs 300 in its September 29, 2008 research report. "At the CMP of Rs 186, the stock trades at an EV/EBIDT and P/E of 4.3x and 2.8x its CY09E earnings. We expect the strong predictability of demand & margins, coupled with visibility of revenues and the operating leverage of the company’s business model to enable it to capitalise on the trend of pricing advantage moving in favour of CPC manufacturers. Hence, we initiate coverage with a ‘BUY’ recommendation, with a price target of Rs 300 on an investment horizon of 12 months," says PINC's research report.



Motilal Oswal on Lupin - Target of Rs 933


Motilal Oswal has maintained its buy rating on Lupin with a target of Rs 933 in its September 23, 2008. "Lupin is currently valued at 15.1x FY09E and 11.3x FY10E core earnings. We believe that the stock has the potential of getting rerated given the differentiated business model of the company. If the current INR v/s the USD rate sustains (@ Rs 46/USD), we expect an upside to our estimates. We reiterate Buy with a price target of Rs 933 (28% upside). Earlier-than-expected competition for Suprax (in US) and significant currency appreciation, are the key risks to our positive stance," says Motilal Oswal's research report.

Godawari Power, Country Club, Idea Cellular

Karvy Stock Broking on Godawari Power - Target of Rs 260

Karvy Stock Broking has maintained its buy rating on Godawari Power & Ispat with a target of Rs 260 in its September 26, 2008 research report. "Godawari Power & Ispat (GPIL) has recently announced its plan for setting up 1000 MW thermal power plant in Chhattisgarh. Godawari Power Ltd, a subsidiary of GPIL signed a Memorandum of Understanding (MoU) with the Government of Chhattisgarh. We continue to be positive on the stock backed by likely to net profit growth of 31% (CAGR) on net sales CAGR of 37% during FY08-10E."

"At the current price, the stock is trading at 3.3x FY09E and 2.5x FY10E earnings. GPIL is available at an EV/EBIDTA of 3.4x FY09E and 2.7xFY10E. It is trading at 0.8x FY09E BV and 0.6x FY10E BV. As it is available below its current year (FY09) BV, we reiterate our BUY rating on GPIL with a price target of Rs 260 per share," says Karvy Stock Broking's research report.

Prabhudas Lilladher on Country Club - Target of Rs 797

Prabhudas Lilladher has maintained its buy rating on Country Club (India) (CCIL) with a target of Rs 797 in its September 20, 2008 research report. "CCIL’s aggressive expansion plans in terms of acquiring properties and offering comprehensive range of products to its clients has helped the company to grow at CAGR of 210.8% over last three years to Rs 3.18 billion in FY08. At the CMP of Rs 270, the stock trades at 4.5x FY09E and 2.7x FY10E earnings."

"We believe that CCIL should trade at a premium to the current valuations, given its strong revenue and profit growth. We maintain BUY rating on the stock with a target price of Rs 797 (8x FY10E)," says Prabhudas Lilladher's research report.

Prabhudas Lilladher on Idea Cellular - Target of Rs 94

Prabhudas Lilladher has initiated an accumulate rating on Idea Cellular with a target of Rs 94 in its September 19, 2008 research report. " We initiate coverage on Idea cellular with an accumulate rating and a DCF based target price of Rs 94 (WACC=13%, Terminal growth rate=3%). Idea cellular is in the early stage of wireless coverage and at least 3-4 years away from attaining maturity. Further, new rollouts are currently gestation businesses (with around 10-12 quarters away from breaking even). Hence, we have used DCF as our prime tool to capture the true potential of the business," says Prabhudas Lilladher research report.