Stock views on Manappuram General Leasing and Finance, IOL Chemicals, Titan Industries

LKP Securities on Titan Industries - Target Rs 2162

 

LKP Securities has come out with a research report on Titan Industries. The firm has initiated coverage on the stock with a buy rating and with a one-year target price of Rs 2,162, in its report.
 
The report says, "Titan Industries, operating in the retail segments of watches, jewellery, and eyewear, has performed well because of the market leadership position in both organized watch (>60% market share in organised watch retail) and jewellery segments and being the first mover in organized eyewear retail market. The prescription eyewear segment of the company is picking up well and is expected to breakeven by FY12E."

"We expect the revenues of Titan to grow at a CAGR of 19.4% over FY09 - FY11E to Rs 54.2 billion, with profitability growing at a CAGR of 37.2% to Rs 3.2 billion over the same period. The company has a strong balance sheet with D/E of 0.1x FY11E and cash in books of over Rs 500 million at the end of FY09," according to LKP Securities report.

The report also says, "The growth in volumes for both watches and jewellery are indicative of an improvement in consumer spending and acceptability of higher gold prices. Currently, the stock trades at 23.9x FY11E EPS of Rs 72.1. With strong revenue visibility and robust earnings growth, we remain optimistic on the future growth of the company. Considering the niche retailing segments, the company is present in and its market leadership position in them, we value the stock at 30x FY11E earnings to arrive at a one-year target price of Rs 2,162. We initiate coverage on the stock with a buy rating, recommending investors to accumulate the stock at declines."

Sunidhi Securities on IOL Chemicals - Target Rs 75

 

Sunidhi Securities is bullish on IOL Chemicals and Pharmaceuticals and has recommended buy rating on the stock with a target of Rs 75, in its research report.

"Established in 1986, IOL Chemicals and Pharmaceuticals (formerly known as Industrial Organics) is a manufacturer & supplier of industrial chemicals & bulk  drugs for use in various pharmaceutical & chemical applications. Its products  portfolio includes industrial chemicals, industrial organic chemicals such as acetic  acid, ethyl acetate, acetic anhydride, isobutyl benzene, mono chloro acetic acid,  acetyl chloride and bulk drugs like ibuprofen. It has a strong business relationship  with a number of prestigious clients such as Ranbaxy Labs, Cipla, Flex Industries,  ICI Paints, Asian Paints, Pidilite, Rallis India, Hindustan Polymide, Gujarat Super  Phosphate, & Avon Organics etc." 

"According to a McKinsey report, India will emerge as the 10th largest  pharmaceutical market by 2015 overtaking Brazil, Mexico, South Korea and Turkey.  From a market size of around US$ 7 billion, the Indian pharmaceutical market is  projected to grow to about US$ 20 billion by 2015. In fact the incremental growth of  US$ 13 billon is likely to be the 3rd largest among all markets after US and China.  All these augur well for the prospects for IOLCPL.  IOLCPL is likely to post an EPS of Rs 9.4 in FY10 and Rs 16 in FY11. At the CMP  of Rs 54, the share is trading at a P/E of 5.7x on FY10E and 3.4x on FY11E. We  recommend BUY with a target of Rs 75 in the medium term."

Emkay Global Financial Services on Manappuram - Target Rs 900

Emkay Global Financial Services is bullish on Manappuram General Leasing and Finance and has recommended buy rating on the stock with a target of Rs 900, in research report.

"Manappuram General Leasing and Finance (MAGFIL) is India's one of the few listed micro finance company with enviable presence in the loan against gold segment. Large population without access to banks, high gold prices and doubling of branch network (to 1500 over FY09-12E) will help MAGFIL's AUM grow by 8x over FY09-12E. We expect MAGFIL's net profit to grow by 12x (to Rs3.5bn) over FY09-12E, driven by strong AUMs growth and strong pricing power with NIMs of 16%+."

"With robust risk management systems in place (3-stage appraisals, strong vaults and limiting the loan sizes to 15-20k), we expect MAGFIL to achieve this growth without compromising on the asset quality. We expect MAGFIL's net NPAs to move down from 1.4% to 0.2% of advances over FY09-12E. We expect MAGFIL to report RoAs of 5%+ and RoEs of 35%+ over FY09-12E. The stock valuations at 2.3x FY12E ABV are quite attractive. As has happened with many other NBFCs, we expect MAGFIL's valuations to track its balance sheet growth. We recommend BUY with a TP of Rs 900, valuing it at 3x FY12E ABV."