Stock Views on CESC, Emco, ICICI Bank

Angel on ICICI Bank - Target Rs 888

Angel Broking has maintained its buy rating on ICICI Bank with a target price of Rs 888 in its research report.

"The Bank’s Balance Sheet contraction continued, with advances declining by 9% and deposits by 4%, sequentially. Moreover, the Bank’s NIMs declined sequentially by 20bp, which the management explained was partly on account of low-yielding priority sector loans contracted towards the end of 4QFY2009, and partly on account of investments in low-yielding assets during 1QFY2010. We maintain a 'Buy' on the stock, with a target price of Rs 888, implying an upside of 17%," says Angel's research report


India Capital Markets on Emco - Target Rs 108

India Capital Markets has recommended a buy rating on Emco with a target price of Rs 108 in its research report. "Emco Limited registered a growth of 5.1% in revenues during Q1FY10 to Rs 1926 million as against Rs 1833 million in the same quarter last year. Emco Limited’s Q1FY 10 results were below our expectations in terms of revenue and profitability. We introduce our FY 11 numbers. The current order book position of the company provides decent visibility for the entire current financial year, also the government emphasis on the power sector as a whole will help provide decent revenue and earnings opportunity for the company in the near future and therefore we upgrade our rating and recommend 'BUY' rating to the stock with a target price of Rs 108 (9x its FY 11E earnings) i.e. a potential upside of 20% from the current price levels," says India Capital Markets' research report.

Angel on CESC - Target Rs 449

Angel Broking has maintained its buy rating on CESC with a target price of Rs 449 in its research report.

"CESC grew its net revenue by 4.7% yoy to Rs 820 crore (Rs 783 crore) in 1QFY2010, which was in line with our estimates. We expect CESC to record a CAGR of 13.9% in its top-line over FY2009-11, while the bottom-line would post a CAGR of 5% in the mentioned period. We have also assigned a FY2011E P/BV multiple to the company’s existing Power business at 1.25x, which is lower than its peers. Hence, we have arrived at a sum-of-the-part (SOTP) target price of Rs 449. Therefore, considering that the company is inexpensive on FY2011E P/BV basis, we maintain a 'Buy' on the stock," says Angel's research report.

Bonanza Portfolio Views on Midcap Power Stocks - CESC, JP Hydro

CESC

The company has an integrated utility business model with a presence in generation and distribution. It has installed capacity of 975 MW, has four generating units and caters to 2.1mn consumers in Kolkata. It is working on a 250-MW Budge Budge expansion. It is also getting into mining business and coal mines have been allocated to them. Spencer Retail is one of the subsidiaries of the company.

JAIPRAKASH HYDRO POWER

Jaiprakash Hydro-Power Ltd (JHPL), a part of the Jaypee Group, owns and operates the 300 MW Baspa-II Hydroelectric project in HP. It is also setting up joint venture for transmission of power. The current policy of the government is to enhance the share of hydropower in the current power generation basket. The EPS is Rs 3.20. The stock is attractively valued and is currently available below its issue price.

Stock views on Petronet LNG, CESC, Asian Paint

Asit.C.Mehta on Asian Paint - Target price Rs 1419

Asit.C.Mehta research ahs maintained buy rating on Asian Paint wih target price of Rs 1419 in its May 13, 2008 research report. "Asian Paints Ltd. (APL) consolidated revenue for Q4 FY08 increased by 18.2% from Rs. 9,589 million in Q4 FY07 to Rs 11330 million in Q4 FY08. Whereas the consolidated revenue for FY08 increased by 20% from Rs 36,699.7 million in FY07 to Rs. 44,043 million. The growth was due to: The quantity sold increased by 18.7% from 481812 tonnes in FY07 to 571,911 tonnes in FY08. Increase in the value of sales due to good market conditions prevailing in domestic and Middle East. At CMP of Rs. 1230.0 the stock is trading at 25.6 x FY09E & 19.9x FY10E earnings per share. With Industry and company’s outlook remaining status quo and in line with our expectations. We maintain a “BUY” recommendation for Asian Paints Ltd. price-objective of Rs 1419 (implying a forward P/E multiple of 23x) on account of robust domestic demand for decorative paints" says Asit.C. Mehta research report.

Angel Broking on CESC - Target price Rs 643

Angel Broking has maintained buy rating on CESC with target price of Rs 643 in its May 13, 2008 report. "We remain positive on the domestic Power Sector and expect it to grow in line with the country’s GDP growth. Our positive stance stems from the fact that peak power demand in excess of 13% gives immense opportunity to players like CESC, who are in a position to tap this huge opportunity on account of their vast experience. Further, with the company also having huge expansion plans which are on track, we believe rapid growth would continue going ahead"

"We expect CESC to record a CAGR growth of 7.6% in Top-line over FY2008-10, while Bottomline would grow at a CAGR of 10.4% in the mentioned period. At the CMP, the stock is trading at 14.9x FY2010E EPS and 1.7x FY2010E P/BV. We have introduced our FY2010 estimates. We have also assigned a lower FY2010 P/BV multiple to the company’s existing Power business at 1.75x (earlier 2.5x FY2009E) owing to drop in relative valuations. Hence, we revise our SOTP Target Price to Rs 643 (Rs 723). Nonetheless, considering that the company is inexpensive in terms of P/BV on FY2010E basis, we maintain a Buy on the stock" according to Angel broking research report.

Angel Broking on Petronet LNG - Target price of Rs 90

Angel Broking has upgraded its rating on Petronet LNG to buy rating with a target price of Rs 90 in its May 9, 2008 research report. "Dahej expansion to 12.5 mmtpa (current 6.5 mmtpa) is slated to come on stream July onwards in a phased manner. Expanded capacity will help Petronet process more Spot volumes till the 2.5mmtpa contracted supplies from Qatar commence October 2009 onwards. For the next 2-3 years, growth will primarily be driven by Spot LNG and the expanded capacity will benefit from the situation."

"The company is now also diversifying into different segments like power, port development, etc., which is expected to generate value over a period of time. We have valued Petronet on DCF methodology with a Cost of Equity of 15.2% (high as it is a high beta stock), Cost of Debt - 10% and WACC - 9.2%. The stock is currently available at 9.8x FY2010E EPS of Rs7.7. Based on our DCF valuation model, we upgrade the stock to a Buy, with a target price of Rs 90," says Angel's research report