Stock views on Indraprastha Gas, HBL Power Systems, Madras Cements

Sunidhi Securities on HBL Power Systems - Target of Rs 285

"HBL Power Systems, Q3FY09, sales surged by 4% to Rs 298 crore and net profit declined by 33% to Rs 18 crore due to economic slowdown. During the nine months of FY09, sales surged by 40% to Rs 958 crore and net profit by 65% to Rs 73 crore. OP & NP margins stood at 16.6% and 7.6% respectively against 14.7% and 6.5% in FY08. We recommend 'BUY' with a target of Rs 285 in the medium term," says Sunidhi Securities & Finance's research report.

Nirmal Bang on Indraprastha Gas - Target of Rs 190

"We expect the company to earn an ROCE of 38.4% in FY10E & 40.1% in FY011E. At Rs 138.5 per share the stock is trading at a discount of 37.1% from our intrinsic price of Rs 190 per share which is 13.9x FY10E earnings & 11.4x FY11E earnings. We reiterate our 'BUY' rating on the stock with a price target of Rs 190 per share with a long term view," says Nirmal Bang's report.

Emkay Global on Madras Cements - Target of Rs 111

"Madras Cement Q4FY2009 results are sharply below our expectations primarily on account of lower than estimated topline growth, higher raw material costs and losses in the windmill division. Cement revenues increased by 20.4% yoy to Rs 6.38 billion driven by 6.8% volume growth while realizations grew by 12.8% to Rs 4027/ton. The wind power vertical registered 24.7% yoy decline in revenues to Rs 40 million consequently registering a loss of Rs 75 million."

"During the quarter, MCL entered into contract to source its international coal/pet coke requirement at USD 40-50. This is substantially lower than our estimate for FY10. With MCL importing 70% of its coal requirements, we expect significant savings on the coal cost front. We maintain our earnings estimate for MCL at Rs 18.8/ share for FY10E and are introducing FY11E estimate at Rs 18.9/share. We are increasing our valuation multiple for MCL from 5x to 6x mainly on account of lowering of discount as compared to Shree Cement and better earnings outlook on account of significant cost benefits. We are revising our price target upwards to Rs 111 and maintain our 'HOLD' rating on the stock," says Emkay Global Financial Services' research report.