Indiabulls Securities views on NTPC, Bharat Forge, Jindal Steel, Tata Power

NTPC, target of Rs 194


Indiabulls Securities Research has upgraded its rating on NTPC to buy with a target of Rs 194 in its November 11, 2008 research report. "NTPC clocked revenues to the tune of Rs 96.6 billion for Q2’09. Net profit for the quarter increased 9.6% yoy to Rs 21.1 billion. After the recent correction, we believe NTPC’s stock should prove to be a good buy. Based on our DCF valuation, we have arrived at a target price of Rs 194, assuming a terminal growth rate of 5% and a WACC of 10.5%. Since our target price implies an upside of 28% from the CMP, we upgrade our rating to Buy," says Indiabulls Securities' research report.


Bharat Forge - Target of Rs 130


Indiabulls Securities Research has maintained its buy rating on Bharat Forge with a target of Rs 130 in its November 21, 2008 research report. "Bharat Forge (BFL)’s stock has plunged 63%. At the current market price (CMP) of Rs 92.40, the stock is trading at a forward P/E of 8.3x and 8.1x for its FY09E and FY10E earnings, respectively. We have valued BFL by using the DCF valuation methodology, assuming a WACC of 13.1% and a terminal growth rate of 5%."

"Our valuation suggests a target price of Rs 130, which provides a potential upside of more than 40% from the CMP. At the current levels, we believe that BFL is a compelling long-term investment. Hence, we maintain our Buy rating on the stock," says Indiabulls Securities' research report.


Jindal Steel - Target of Rs 1000


Indiabulls Securities Research has upgraded its rating on Jindal Steel & Power from hold to buy with price target of Rs 1000, in its report dated December 3, 2008. "We have valued the Company by using the Sum-of-the-Parts (SOTP) valuation technique. We have used the DCF methodology to value the standalone company, assuming a WACC of 13% and a terminal growth rate of 5%. Additionally, we have valued JPL at two times its estimated book value at the end of Q2’09. Our SOTP-based valuation of Rs. 921 suggests a potential upside of 18.6% from the current market price (CMP) of Rs 776.9. Given the growth potential of its power business and based on our valuation, we upgrade our rating on the stock from Hold to Buy," says Indiabulls Securities' research report.


Tata Power - Target of Rs 872


Indiabulls Securities Research has upgraded its rating on Tata Power Company with a target price of Rs 872 in its December 4, 2008 research report. "Tata Power Company Ltd. (TPC), a leading private power sector player, is expected to significantly ramp up its capacity in the coming years on the back of the 4,000 MW Mundra UMPP and the 1,050 MW Maithon power project. Based on our SOTP valuation, we have arrived at a target price of Rs 872. Thus, we have upgraded our rating from Hold to Buy," says Indiabulls Securities' research report.