Stock views on JYOTI STRUCTURES, WHIRLPOOL INDIA

LKP SECURITIES  on WHIRLPOOL INDIA

LKP Securities initiates coverage on Whirlpool of India with a Buy' rating and has a one-year price target of Rs 356. Whirlpool India, owned 75% by the $19-billion US-based home appliances giant, Whirlpool Corporation, has generated over Rs 200 crore in cash (Rs 145 crore) from operations last fiscal while emerging as a debt-free entity. LKP expects washing machines to remain an urban-centric product and the volume mix to shift towards the fully automatic models and its share to rise significantly. They however, expect the addressable market size of refrigerators to increase going forward and the mix to shift towards the high end frost-free segment, which would aid the growth of Whirlpool in India. Whirlpool is best placed to expand its footprint aided by modern trade given its brand equity, RoE of 44%, RoCE of 49% and vast distribution strengths. LKP expects Whirlpool to grow its net profits at a CAGR of 31% over the next two years on the back of an expected 22.8% CAGR growth in revenues.

RELIGARE CAPITAL  on JYOTI STRUCTURES

Religare reiterates `Buy' rating on Jyoti Structures with a target price of Rs. 185. Even as competition in the power transmission EPC (engineering, procurement and construction) sector has intensified, order flows could positively surprise in FY11E. Religare believes that large ticket size orders (in comparison to the current order backlogs) could be important triggers for stocks in the transmission sector. Religare prefers Jyoti Structures (JYS) due to three reasons: 1) Its market share in orders from Power Grid Corporation of India (PGCIL) has been higher over FY08- FY10 2) The company's margin profile has been less volatile than peers due to higher concentration of price variable contracts 3) It has a higher share of domestic power transmission EPC orders in the backlog. According to conservative estimates, order flows from PGCIL for the power transmission EPC segment could grow about 3x in FY11E. At the current estimates, the stock is trading at a P/E of 11.6x and 10x for FY11E and FY12E respectively.