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.