Stock views on KPIT Cummins Infosystems, Mundra Port

Firstcall Research on Mundra Port - Target Rs 790

 

Firstcall Research has recommended buy rating on Mundra Port, with price target of Rs 790, in its report

"At the current market price of Rs.709.00 the stock is trading at a P/Ex of 41.55x for FY10E and 34.64x for FY11E. The EPS of the stock is expected to be at Rs.17.06 and Rs.20.47 for FY10E and FY11E respectively.

On the basis of price to book value, the stock trades at 8.35x and 6.73x for FY10E and FY11E respectively. Two Mega Thermal Power Plants with total capacity in excess of 8600 MW (Tata Power 4000 MW, Adani Power 4600 MW) are being constructed in Mundra Region. The plants require very high volumes of imported coal, up to 40 million Tons Per Annum (MTPA). In addition other dry volumes such as Iron ore, etc. are also to be imported for the industries planned in the vicinity of Power Plants.

 

Mundra Port Special Economic Zone Ltd to develop Mormugao Port coal handling terminal on design, build, operate and transfer basis. Mundra Port and SEZ Ltd (MPSEZL) has been awarded LOI by the Hazira Port Pvt Ltd for development of non LNG port facilities at Hazira.

 

Mundra Port and Special Economic Zone Ltd enters into a joint venture between Alstom and Bharat Forge will set up an equipment manufacturing facility at its special economic zone.The 24 billion rupee project (USD 520 million) would have capacity to make 5,000 megawatt high-efficiency power generation equipment.

 

The Company has entered into an agreement with Maruti-Suzuki which will involve export of cars out of India from Mundra Port. Inland Conware Private Limited (ICPL) a subsidiary of MPSEZL is engaged in the establishing and managing Inland Containers Depots (ICD) in National Capital Region for international trade and also proposes to set up ICDs for domestic cargo subsequently.

 

The Net sales and PAT of the company is expected to grow at a CAGR of 24% and 59% respectively over FY08 to FY11E. MPSEZL plans to handle cargo volume of 50 million tonnes by 2010 from the present 19.8 million tonnes.

 

The major ports on the west coast (JNPT, Mumbai Port and Kandla Port) are operating at close to 100% capacity utilization. Mundra port is well placed to attract the traffic on the west coast due to its unutilized capacity and strategic advantages.

 

We recommend a "BUY" on the stock with a target price of Rs.790.00 for medium to long term." says Firstcall Research report.

 

 

Sunidhi Securities on KPIT Cummins - Target Rs 140

Sunidhi Securities & Finance has recommend buy rating on KPIT Cummins Infosystems with a target of Rs 140 in its report.

"KPIT's specialized and niche set of offerings span from Engineering (Advanced Technology Solutions - Automotive and Semiconductor Solutions), through Enterprise IT & Business Intelligence to BPO/ KPO) solutions. KPIT's strategy continues to be to focus on a small set of industry verticals and a small number of named target customers. In its focus verticals of automotive, industrial and high-tech verticals, KPIT is a niche player with relatively high-end offerings for the CIO, CTO and CFO of the customers. In October 2009, KPIT bought US-based Sparta Consulting Inc. for $38 million (Rs 180 crore). KPIT is likely to post an EPS of Rs 11.8 in FY10 and Rs 13.5 in FY11. At the CMP of Rs 112, the share is trading at a P/E of 9.8x on FY10E and 8.3x on FY11E. We recommend BUY with a target of Rs 140 in the medium term, "says Sunidhi Securities & Finance report.