Stock views on Balaji Telefilms, Jyoti Structures, Rolta

ULJK Securities on Rolta - Target Rs 190

ULJK Securities has recommended a buy rating on Rolta India with a target price of Rs 190 in its research report. "The company is confident of achieving its target of guidance of Rs 14.80 billion- Rs 15 billion and the PAT levels at Rs. 3.20 billion- Rs 3.30 billion. The order book position of the company is about Rs 15.90 billion. We expect the growth will most likely be driven by capturing the market in the GIS/EDA space for infrastructure space. We are initiating coverage with BUY recommendation, target of Rs 190," says ULJK Securities' research report


Reliance Money on Jyoti Structures - Target Rs 85

Reliance Money has recommended a buy rating on Jyoti Structures with a target of Rs 85 in its research report. "The overall Q3FY09 performance of Jyoti Structures Ltd (JSL) remains below our expectation. JSL witnessed a top line growth of 25% YoY to Rs 4330.7 million in Q3FY09. However higher borrowing cost along with increase in other expenditure negatively impacted the bottom line which saw a drop of 10.4% YoY during the quarter to Rs 180.6 million. The order book inflow has slowed down during the quarter which has raised concerns, but we remain confident on margins for next two years. We keep our BUY recommendation with a revised price target of Rs 85," says Reliance Money's research report.


Angel Broking on Balaji Telefilms - Target Rs 52

Angel Broking has downgraded its rating on Balaji Telefilms with a target of Rs 52 in its research report. "For the quarter, Topline de-grew 36.8% yoy to Rs 50.6 cr (Rs 80 cr) on a Standalone basis. In terms of Earnings, the company registered a decline of 97% yoy in Standalone Bottom-line to Rs 0.6 cr (Rs 18.8 cr) as a result of sharp Margin contraction. We have downgraded our rating on the stock to Accumulate from Buy, with a revised Target Price of Rs 52 (Rs 103), assigning a lower P/E multiple of 7x FY2010E factoring in higher uncertainty on its programming slate and lower Earnings growth," says Angel Broking's research report.

Stock Views on Balaji Telefilms, Ranbaxy, Jyothi Structures, Hindalco Industries

MERILL Lynch on Balaji Telefilms - TARGET PRICE: RS 177

MERILL Lynch has maintained its “underperform” ratings on Balaji Telefilms. Recently, the STAR Group (STAR) had said it would sell 25.99% stake in BTL to the promoters or parties nominated by it at Rs 190 per share in 240 days. This implies that Balaji would be free to do programming for STAR’s rivals in certain time slots. “However, given the dominance of STAR Plus in the Hindi general entertainment (GE) space, we believe that the incremental opportunity could have lower ratings and higher costs. We think it is fraught with lower margins, lower RoE, and therefore, not positive for Balaji,” the Merrill note to clients said. “We believe earnings in Balaji’s core content business is set to slow — 12% CAGR (FY08-10 estimated) against a robust 27% (FY05-07),” the note added, citing limited prime time slots left for programming in the Hindi GE space, weak ratings on STAR Plus, entry into lower margin movies and higher costs on political intervention in labour matters as the reasons.

UBS on Ranbaxy - TARGET PRICE: RS 511

UBS has downgraded its ratings on Ranbaxy from “neutral” to “sell” , citing the ongoing investigation by the US Food and Drug Administration as a major concern. “We believe the ongoing US investigation is unlikely to be resolved in the short term and that negative publicity and heightened scrutiny are likely to result in slower product approvals in the US and other markets. We, therefore, now value Ranbaxy’s core business in line with tier-II Indian generic companies at 18 times adjusted forward earnings,” the UBS note to clients said. UBS has slashed its price target for Ranbaxy to Rs 511 from Rs 593 earlier and lowered its earlier earning per share estimate for 2008 by nearly 33% to Rs 12.78. “Our lower 2008 forecast is primarily due to FX translation loss on FCCBs,” the UBS note to clients added, also mentioning that the business outlook for the company remained “challenging”. “We believe Ranbaxy continues to face challenges in the EU market and that 10-12% year-on-year (Y-o-Y) represents the best case organic revenue growth for the company,” the note said.

MF Global on Jyothi Structures - TARGET PRICE: RS 192

MF Global has recommended a “buy” on Jyoti Structures, citing strong order flows, and an export focused business model which exposes the company to fewer operational risks. The brokerage expects JSL to report a 41% compounded annual growth in revenues between FY08-10 (estimated) and a 39% CAGR in earnings. According to MF Global, the company plans to invest more than Rs 600 million (FY09E) to strengthen its export presence in areas like the Middle-East and Africa. “The capex would mainly be towards buying construction equipment and CNC machines,” the MF Global note to clients says. MF Global expects the company to outperform its peers in a rising input cost scenario. It expects an inflow growth of 25% each during FY09E and FY10E and any positive surprise with respect to inflows would lead to a further increase in profit after tax for JSL.

ENAM Securities on Hindalco Industries - TARGET PRICE: RS 182

ENAM Securities has assigned an “underperformer” ratings to Hindalco as it feels the company’s proposed rights issue is diluting the growth of the company Hindalco is planning a rights issuance of three shares for seven existing shares at Rs 96 per share. “This is in contrast to the earlier envisaged one share for every three shares around Rs 120 per share and is round 30% discount to FY08 book value per share. The issuance hints at a sense of urgency for fund raising, given tight capital market conditions, to retire $3-billion bridge debt that expires in November 2008,” the Enam note to clients said. “We reduce our FY09 and FY10 earnings per share estimate to Rs 17.5 (Rs 19.9 earlier) and Rs 22.7 (Rs 24.4 earlier), respectively, to reflect more-than-anticipated rights dilution at lower price and attendant net interest impact,” the note added.