Angel Broking Views on Exide Industries, Patel Engineering, Bajaj Auto

Angel Broking on Patel Engg - Target Rs 545

Angel Broking has recommended a buy rating on Patel Engineering, with price target of Rs 545, in its report.

"We have valued Patel Engineering on SOTP methodology. We have assigned its Core Construction business a PE of 12x FY2011E EPS of Rs 36.8. Its Real Estate arm has been valued at a huge discount, using the NAV method, at Rs 103/share. In the recent past, the stock had witnessed a sharp appreciation, in line with its construction peers. We believe that, at the current levels, PE is available at reasonable valuations. At CMP, the stock is trading at 11.6x its FY2011E EPS of Rs 36.8, on a consolidated basis without considering its real estate venture. We recommend a Buy on the stock, with a Target Price of Rs 545," says Angel Broking's report.

Angel Broking on Bajaj Auto - Target of Rs 1230

"For Q1FY2010, Bajaj Auto (BAL) clocked Net Sales of Rs 2,339 cr (Rs 2,311 cr), up 1.2% yoy, which was in line with our expectation. Total volumes for the quarter declined 11.7% yoy while average realisations per vehicle improved substantially by almost 10.7% yoy primarily due to the change in product mix and better performance by the 125cc-plus Segment. During 1QFY2010, BAL witnessed a substantial 793bp yoy jump in EBITDA Margins to 19.5% (11.6%). Before Extraordinary items, Net Profit stood at Rs 317.5 cr (up 81.3% yoy) and exceeded our expectations. On a qoq basis too, Margins improved by almost 834bp. We maintain an Accumulate on the stock with a revised Target Price of Rs 1,230 (Rs 1,016 earlier), " says Angel Broking's report.

Angel Broking on Exide Industries - Target of Rs 81

"Exide Industries, India’s largest Auto Battery manufacturer, for 1QFY2010 clocked 0.3% yoy decline in Net Sales to Rs 903.5 cr (Rs 906.5), which was better than our estimate of Rs 797 cr on the back of better qoq growth in Total Volumes during 1QFY2010. During 1QFY2009, Exide witnessed a 665bp yoy increase in EBITDA Margins owing to a 1,002bp yoy fall in Raw Material costs, which accounted for around 58.2% of Sales (68.2% in 1QFY2009). The company reported 48.9% yoy increase in Net Profit to Rs 122.4 cr during the quarter. Interest cost fell 96.3% yoy to Rs 0.4 cr including Exchange gains of Rs 1.03 cr. We upgrade our EPS estimate for the company to Rs 5.5 (Rs4.2 earlier) and Rs 6.0 (Rs 5.2 earlier) for FY2010E and FY2011E, respectively. We maintain an Accumulate rating on the stock, with a revised Target Price of Rs 81 (Rs74)," says Angel Broking's report.