Stock views on Bharati Shipyard, Ashok Leyland, Alphageo India

Sharekhan on Alphageo India - Target Rs 297

Sharekhan has recommended a buy rating on Alphageo India, with price target of Rs 297, in its report.

"The order pipeline from fresh tenders is also healthy and Alphageo India hopes to announce more new orders from private operators in the coming months. The efforts to reduce the company’s dependence on public sector oil companies (like ONGC and Oil India) are yielding results now both in terms of better revenue growth outlook and improved utilisation of resources (seismic crews). Given its strong performance in Q2FY2010, healthy order book position and improving client profile, we have significantly upgraded the estimates for FY2010 and FY2011. Consequently, we have upgraded our recommendation to Buy with the price target of Rs 297 (12x FY2011 earnings)," says Sharekhan report.

Sharmila Joshi on Ashok Leyland - Target of Rs 56

Buy Ashok Leyland with a target of Rs 56, says Sharmila Joshi, Investment Advisor.
Joshi told, "Ashok Leyland is bought with an intraday target of Rs 56. Couple of reasons why I like this stock and I do think from current levels these could be an outperformer in the space. I think similar to the kind of catch-up that you saw between Bajaj Auto and Hero Honda; you could see that repeated in this space largely because of the kind of recovery one is seeing in the commercial vehicle space. So this is a high performance kind of potential, the management has given a guidance of about 60,000 to 62,000 units for FY10."

She further added, "The kind of performance this company has shown in the second quarter where they have done about 23.6% kind of growth that’s likely to be maintained in the next two quarters as well and that’s good news. Their AVIA is very close to breakeven and their Uttarakhand plant is getting sanctioned in January ’10 and this will mean an excise duty kind of saving of almost about Rs 6,000 per unit. So, good stock especially if you have maybe FY11 kind of an EPS in mind and as I said I bought it with an intraday target of Rs 56."

KRChoksey on Bharati Shipyard - Target Rs 206

KRChoksey research is bullish on Bharati Shipyard and has recommended buy rating on the stock with a target of Rs 206, in its research report.

"Considering Bharati acquires 20% stake in Great Offshore from the open offer at Rs 590 per share, the average price of its acquisition of 43.1% stake (post open offer) comes out to be Rs 475 per share. At this price Great Offshore is valued at ~12x its FY10E earnings. Though this acquisition may look expensive when we compare it with the valuation of Aban Offshore (P/E of 10x), however, Aban’s discounted valuation is justified by its debt burden. So we believe, that Bharati Shipyard would be acquiring Great Offshore at a fair valuation. This acquisition presents significant synergies to Bharati, whose current order book would last for another 2-3 years. In the next two years, Great Offshore’s 70% of assets will come for replacement or repairs. These orders can be worth Rs 2500-3000 crore. Thus, great offshore’s orders will come at the time when Bharati’s orders are about to get exhausted. We maintain a BUY on Bharati Shipyard with a target price if Rs 206,"says KRChoksey research report.