Stock views on Lupin, South Indian Bank

AnandRathi on South Indian Bk - Target Rs 192:

 

AnandRathi is bullish on South Indian Bank and has recommended buy rating on the stock with a target of Rs 192, in its research report.

"South Indian Bank's 4QFY10 net profit declined 23.2% yoy, due to increased interest expenses (~Rs468m). This was not reported over 9M10, but in 4Q10. Management attributed this to a 'technical glitch' in their banking technological platform. In the conference call with management, they stated that the bank's technology and processes are being further improved, and another system audit would also be conducted. Due to this 'glitch', we reduce our NIM assumptions, and lower the FY11 NII by 6.6% and FY12 by 2.1%."

"We lower EPS estimates – by 8.3% in FY11 and 7.1% the year after, due to lower net interest margin assumptions. As we value the stock at 1.2x 12-month forward ABV, we raise our target price from Rs174 to Rs192. Its conservative loan growth, strong deposit franchise and healthy asset quality make it an attractive pick among small-cap banks," says AnandRathi research report.

 

P Lilladher on  Lupin - Target Rs 2010

 

Prabhudas Lilladher is bullish on Lupin and has recommended buy rating on the stock with a target of Rs 2010, in its research report.

"Net sales (excluding other operating income) of Lupin grew by 23.1% - from Rs 10.4 billion to Rs 12.9 billion YoY (we expected Rs12.5bn). Advanced market (US & EU) grew by 17.6% - from Rs5bn to Rs5.8bn YoY (this was much lesser than the expected rate of 31%). Sales from Japan grew by 16.6% - from Rs 1.1 billion to Rs 1.26 billionn YoY (this is higher than the expected rate of 15%). We expect sales and net profit to grow at a CAGR of 19.3% and 26%, respectively over FY10-12. At the CMP, the stock trades at 19.4x FY11E and 14.8x FY12E. We maintain our 'BUY' rating on the stock."