LKP Shares on Plastiblends India, BASF India, Jyothy Labs

Plastiblends India -Target Rs 200

LKP Shares has recommended a buy rating on Plastiblends India with an 18-month price target of Rs 200 in its research report. "Despite being a small cap company with a market capitalization of only Rs 650 million, Plastiblends has not tapped the capital markets since its IPO in the early nineties and given its strong balance sheet and robust cash flows we do not expect any equity dilution going forward as it would be able to fund its expansion plans comfortably through internal accruals. Given the scalability of the business and the ROI we believe that PIL is well placed to achieve critical mass in masterbatches during the next three years and the stock trading at 3xFY'10E with a dividend yield of 7% is an exciting small cap pick. We recommend a BUY on the stock with an 18-month price target of Rs 200," says LKP Shares' research report.

BASF India - Target Rs 300

LKP Shares has recommended a buy rating on BASF India with an 18-month price target of Rs 300 in its research report. "Post second quarter results we believe that BASF should be able to report a 37% CAGR growth in net profits over the next two years on the back of a 34% CAGR growth in revenues over the same period. BASF India with an ROCE of 35% having the ability to grow its profits at 35% over the next two years trades at 5xFY'10E earnings with a dividend yield of 3% with the possibility of another open offer going forward remains a defensive investment bet in the present uncertain markets. Any dips below Rs 200 are a good buying opportunity and we recommend a BUY on the stock with an 18-month price target of Rs 300," says LKP Shares' research report.

Jyothy Labs - Target Rs 300

LKP Shares has recommended a buy rating on Jyothy Laboratories with a one-year price target of Rs 300 in its October 29, 2008 research report. "With the Sensex itself trading at 10x we believe that there is a compelling reason to buy JLL which is trading at 6x with a dividend yield of 4% and above all it is a debt free company (cash per share of Rs 65) which came out with its IPO a year back in November 2007 at Rs 690 (Rs 5 paid up) purely to provide an exit to private equity investors and did not collect any funds for itself. JLL has corrected to Rs 215 now from its peak of Rs 965 in early January 2008 and at CMP of Rs 215 we believe that it is an attractive investment bet for investors with a one-year price target of Rs 300, which is a 40% upside from current levels," says LKP Shares' research report.