Stock views on Shree Cements, Zuari Inds, Patel Engg

Angel Broking on Patel Engg - Target Rs 316

Angel Broking has recommended a buy rating on Patel Engineering, with price target of Rs 316, in its report dated October 17, 2008. "Patel Engineering (PE) registered steady growth for 2QFY2009. Consolidated Sales were in line with our expectations increasing by 30% yoy to Rs 442 crore (Rs 339 crore) on the back of a strong order book of Rs 6,301 crore. For 1HFY2009, growth was tad better at 33% to Rs 1,000 crore (Rs 754 crore). Patel Engineering posted a Net Profit growth of 20% for 2QFY2009 to Rs 42.6 crore (Rs 35.5 crore) in line with our estimates."

"We expect the company to grow at a CAGR of 25% over the next two years and it would be one of the few players to stand tall on the Margin front especially amidst the prevailing high commodity price and rising Interest rate regime. At the CMP of Rs 177, the stock is trading at 9.8x FY2009E and 6.9x FY2010E EPS of Rs 18 and Rs 25.5 respectively, on Standalone basis. We maintain a Buy on the stock, with a Target Price of Rs 316 (Rs 418)," says Angel Broking's report.

HDFC Securities on Zuari Inds - Target Rs 482

HDFC Securities has maintained its buy rating on Zuari Industries with a target of Rs 482 in its October 21, 2008 research report. "In H1FY09 Zuari’s profits increased 78% YoY to Rs 776 million. But, as the management was unavailable to comment, we haven’t revised our estimates for FY09E & FY10E. Valuations remain compelling."

"At the CMP, even if 60% of the profits are maintained in H2FY09, the standalone business is available at 4.3x FY09E EPS. Above this, for the full year, we expect Zuari’s JV Paradeep Phosphate (50% holding) to report a PBT of Rs 5 billion, which is equal to Zuari’s current market cap. We maintain BUY but with a modest price target of Rs 482 (adjusted for current market value of investments) from Rs 510 earlier," says HDFC Securities' research report.

HDFC Securities on Shree Cements - Target Rs 803

HDFC Securities has maintained its buy rating on Shree Cements (SCM) with a target of Rs 803 in its October 7, 2008. "We expect the earnings of SCM to grow at a CAGR of 17% over FY08 to FY10E. We have valued the company on 4x FY09E EV/EBITDA, which gives us a target price of Rs 803 per share, an upside of 62% over its CMP. At our target price of Rs 803, the stock will trade at 6.4x FY09E and 7.8x FY10E EPS. We maintain BUY rating on the stock," says HDFC Securities' research report.