Stock Views on Ipca Labs, Infosys Technologies, Glenmark Pharma,

Emkay Global Financial Services on Ipca Labs - Target Rs 1107

Emkay Global Financial Services has recommended a buy rating on Ipca Laboratories, with price target of Rs 1107, in its report dated December 17, 2009. The stock closed at Rs 1019.80
"We are of the view that Ipca Laboratories provides good visibility in terms of consistent CAGR growth of 20% over next few years on the back of its focus on branded formulations segment, geographical expansions in semi-regulated markets, new product launches in fast growing chronic segment and focus on European and US markets. On the back of upward revision in our FY11E earning estimates, we have raises our target price form Rs 971 to Rs 1107 (12x FY11E)," says Emkay Global Financial Services report

Angel Broking on Infosys - Target Rs 3020

Angel Broking has recommended a buy rating on Infosys Technologies, with price target of Rs 3020, in its report. The stock closed at Rs 2526.50

"Infosys has always focused on organic growth, maintaining its profitability and creating shareholders value, which the company achieved even during the global economic turmoil in FY2009. We believe the company is well poised to take advantage of the upcoming opportunities and face the challenges through its novel business plans and quality manpower.

While the Infosys management at the analyst meet did indicate that near-term pressure on IT Budgets is expected to continue, we remain confident of the fact that in-line with the global economic recovery, demand for Indian IT services will be back to the forefront and companies like Infosys stand to benefit in particular on account of the availability of talent and delivery from a low-cost base. Thus, considering the above and the increasing focus of the company on non-linear initiatives along with its strategy to focus on newer geographies and services, we remain positive on the company. In this note, we also introduce our FY2012 estimates for Infosys and roll over our target price on FY2012 basis. At the CMP, Infosys trades at 21.7x its FY2011E EPS and 18.5x its FY2012E EPS, which leaves room for further upside. Thus, we recommend a BUY on the stock with a 15-month Target Price of Rs 3,020 (Rs 2,475), valuing the stock at 22x its FY2012E EPS," says Angel Broking report.

Sharekhan on Glenmark Pharma - Target Rs 319

Sharekhan has recommended a buy rating on Glenmark Pharmaceuticals, with price target of Rs 319, in its report. The stock closed at Rs 261.35

"Glenmark has dropped 12% in the year till date (the stock has seen an upside of 21% since we had upgraded our recommendation to Buy from Hold in our report dated October 29, 2009) as compared to the BSE HC Index, which is up 66.5%, and the Sensex, which is up 71.1%. However, with the revival signs gaining visibility in the emerging markets and the domestic markets, where we have seen a staggering growth of 44.6% and 18.4% respectively in H1FY2010.

We expect the cash flow to improve, as the capital expenditure eases and the management attempts to rein in the working capital. This would allow the management to address its high leverage and return to free cash flow territory in FY2010. We believe that the risk-reward ratio is favourable for the stock at the current levels, given an improving macro outlook, which may see the growth rebound in the emerging markets, improving the working capital cycle. Given the healthy business performance expectations and favourable risk-reward ratio, we maintain our Buy recommendation on the stock with a revised price target of Rs 319 (16x FY2011E core earnings for the base business plus Rs 43 per share for the R&D pipeline). At the current market price of Rs 261, the stock trades at 15.1x FY2011E earnings," says Sharekhan report.

Stock Views on Glenmark Pharma, Sasken Communication, Larsen & Toubro

KRChoksey on Glenmark Pharma - Target Rs 252

KRChoksey has maintained its buy rating on Glenmark Pharma with a price target of Rs 252.2 in its report.

"The topline of the company has shown a decline of 10% y-o-y to Rs 491.1 crore whereas on q-o-q basis the company reported a decline of 11%. The fall in sales was due to absence of licensing income during the quarter as compared to Rs 61.0 crore in the corresponding pervious period. Excluding licensing income, the base business declined by 4%. Dip in the base business is due to factors like fewer ANDA approval, destocking in the regions like Latin America & Russia, currency impact in Latin America & Russia and price erosion of Glyptal. Going forward, we expect the revenues to improve on back of improved performance from Glenmark generics, specialty formulation and Indian formulation business."

"We maintain our optimistic view on the company supported by the consolidation from the acquisitions (like Actavis), revenue contribution from the new launches and increasing number of approvals from USFDA which would strengthen the earnings visibility of the company, Buy, target of Rs 252.2," says KRChoksey's report.

Angel Broking on Sasken Communication - Target Rs 127

Angel Broking has recommended a buy rating on Sasken Communication, with price target of Rs 127, in its report.

"Going ahead, we expect Sasken to record 8.5% and 22.6% CAGRs in its Top-line and Bottom-line, respectively, over FY2009-11E (excluding one-time items). Sasken continues to struggle to cope with the difficult business environment, and its key segment, Network Equipment Manufacturers, remains in consolidation mode. The medium-term outlook remains hazy for Sasken even as a recovery is anticipated in 2HFY2010. While the business prospects in the medium-term are a little subdued, we believe current valuations at just 3.3x FY2011E EPS adequately factor this in. We upgrade the stock to Buy from Neutral with a Target Price of Rs 127, implying a P/E of 4x FY2011E EPS," says Angel Broking's report.

Indiabulls Securities on Larsen & Toubro - Target Rs 1621

Indiabulls Securities has recommended a hold rating on Larsen and Toubro, with price target of Rs 1621, in its report.

"Larsen & Toubro is currently trading at a forward (FY10) P/E of 28.8x. Our fair value estimate of Rs 1,621, based on the Sum-of-the-Parts (SOTP) methodology, factors in all the major positives and thus, provides limited upside potential from the current market price. Thus, we change our rating to Hold," says Indiabulls Securities' report.

Stock views on BPCL, Bharti Airtel, Glenmark Pharma

Indiabulls Securities on BPCL, target of Rs 526

"With crude oil prices hovering at around $ 70 per barrel levels, we expect the under-recoveries for PDS kerosene and domestic LPG to escalate further. However, the recent price hike in petrol and diesel prices should provide some respite to the Company. At its current market price the stock trades at a forward P/E of 8.6x and 8.3x for FY10E and FY11E, respectively. We have revised our estimates to consider the recent developments in the sector. Based on our valuation, we have arrived at a target fair value of Rs 526, which provides an upside potential of 15.9% from the CMP. Thus, we upgrade our rating for the stock to Buy," says Indiabulls Securities' research report.

IIFL on Bharti Airtel, target of Rs 866

"In our view, the Bharti–MTN deal is driven more by strategic considerations than by synergies. In a world where giants such as Apple and Google are invading the telco space, size will be key. Nevertheless, an analysis of savings / synergy opportunities in the proposed Bharti–MTN deal suggests that Bharti can have a gain of almost USD 3 billion. Our key assumptions are based on measures attributable to Bharti’s involvement, over and above MTN’s own cost reduction measures. These include estimates of opex and capex savings in MTN and capex savings in Bharti. We consider opex savings in Bharti attributable to this deal unlikely. The proposed deal (as the terms stand now) is not significantly earnings dilutive for Bharti even without considering synergies. Hence, we are in no hurry to reduce our TP (Rs 866); we retain 'BUY', " says IIFL's research report.

KRChoksey on Glenmark Pharma; target of Rs 252

"The topline of the company has shown a decline of 10% y-o-y to Rs 491.1 crore whereas on q-o-q basis the company reported a decline of 11%. The fall in sales was due to absence of licensing income during the quarter as compared to Rs 61.0 crore in the corresponding pervious period. Excluding licensing income, the base business declined by 4%. Dip in the base business is due to factors like fewer ANDA approval, destocking in the regions like Latin America & Russia, currency impact in Latin America & Russia and price erosion of Glyptal. Going forward, we expect the revenues to improve on back of improved performance from Glenmark generics, specialty formulation and Indian formulation business."

"We maintain our optimistic view on the company supported by the consolidation from the acquisitions (like Actavis), revenue contribution from the new launches and increasing number of approvals from USFDA which would strengthen the earnings visibility of the company, Buy, target of Rs 252.2," says KRChoksey's report.

Stock views on HCL Technologies, Lanco Infratech, Glenmark Pharma

Credit Suisse on Glenmark Pharma

Credit Suisse has retained its ‘outperform’ rating on Glenmark Pharma, saying widespread investors’ unhappiness over a last moment guidance change, weak cash flows and R&D provide an opportunity to buy the stock. “The sharp drop in P/E suggests complete disbelief in estimates: the market may be implying Rs 10 FY10 (estimated) EPS, down 33% year-onyear. This ignores continued healthy growth in India and the US (together 60% of sales and 70% of Ebitda), and potential cuts in selling, general and administrative (SG&A) expenses as inefficiencies in ‘other’ markets are addressed,” the Credit Suisse note to clients said.

ICICI Securities on Lanco Infratech

ICICI Securities has retained its ‘buy’ rating on Lanco Infratech, citing visible growth in the company’s EPC order book, discounted valuations for the power portfolio and robust business model. “We expect both projects(Rajpura, Dhopave) to achieve financial closure in the next 12 months, leading to healthy addition in Lanco’s power portfolio. We estimate Lanco’s operational power capacity at 2,000 mw in the next 15 months and do not anticipate any cashflow concerns for the ongoing power projects,” the note to clients said.

Centrum Broking on HCL Technologies

Centrum Broking has assigned a ‘reduce’ to HCL Technologies, citing pressure on medium-term earnings due to recent acquisitions, and hedging losses. “HCL Tech bagged deals amounting to $1 billion in Q2FY09. However, the deals are unlikely to make a significant impact on revenues as they have a component of free transitioning,” the Centrum note to clients said.

Stock Views on Bank of Maharashtra, Kirloskar Oil Engines, Glenmark Pharma

Bonanza on Bank of Maharashtra - Target of Rs 25
Bonanza has recommended a buy rating on Bank of Maharashtra with a target of Rs 25 in its research report.


"Bank of Maharashtra is a mid-sized PSU bank, with branches concentrated in Western India. Bank has controlled its NPA very well. Its NPA levels are at 0.82%. The bank enjoys high CASA of about 38%. Investors can Buy with a target of Rs 25 i.e. about 3PE based on FY09 EPS of Rs 8.23," says Bonanza's research report.


Reliance Money on Kirloskar Oil Engines - Target of Rs 69


Reliance Money has recommended a buy rating on Kirloskar Oil Engines with a target price of Rs 69 in its research report.

"Kirloskar Oil Engines Ltd (KOEL) has announced the demerger of Engine and Auto Component business of the Company into Kirloskar Engines India Ltd (KEIL). In our earlier report dated 28th January 2009 we mentioned that demerger of investments on the books would be beneficial for the investors as it would reflect fair value of core business. In continuation of the same view and considering the potential upside of its strategic investments made in various group and associate companies, we believe after the de-merger KOEL stock to trade at 1x of book value Rs 25."

"We believe the industry would revive only after the increase in capex by these respective user industries. Considering the outlook on the industry and company we estimate the value of KEIL to be around Rs 44. We estimate ROCE of KEIL to be 28% for FY09E which is considerably higher compared to ROCE of 16% for FY09E. We upgrade our recommendation on the back of announcement of demerger of its core business (engines and auto components) into separate company to BUY with a target price of Rs 69 which offers an upside of 23% from current level," says Reliance Money's research report.


Sharekhan on Glenmark Pharma - Target of Rs 270

Sharekhan has recommended a buy rating on Glenmark Pharma with a price target of Rs 270 in its research report.

"Glenmark has borne the brunt of the ongoing economic and financial crises that have resulted in a slowdown in its business across international geographies. The company has been hit by several negative developments right from the failure of GRC 6211, concerns over its ability to meet guidance, uncertainty over outlicensing income and the policy to refrain from providing guidance. Despite the recent disappointments, we continue to like Glenmark’s business model, which is focused on differentiated niche products."

"We remain confident about Glenmark’s future prospects, both in relation to the scaled-up potential of its core generic and branded formulation businesses and its ability to monetise and extract value out of its R&D assets. We upgrade our recommendation on the stock to a Buy with a price target of Rs 270 (12x FY2010 core earnings for base business plus Rs 60 per share for the R&D pipeline)," says Sharekhan's research report.

Stock views on Glenmark Pharma, Shree Cements, Bharat Electronics

Asit C. Mehta on Bharat Electronics - Target Rs 1037

Asit C. Mehta has initiated a buy rating on Bharat Electronics with a target price of Rs 1037 in its research report. "We have valued the stock using the price to book value multiple. Historically, the stock has traded at a discount of approximately 30% to the price to book value multiple of its foreign peers. This could be mainly due to the large size of its peers. Therefore we have assigned a Price /Book Value multiple of 1.8 (which is consistent with the valuation of its foreign peers) to the FY10 book value of Rs.579.5. We, therefore initiate coverage on Bharat Electronics Ltd with a “BUY” recommendation for a target price of Rs 1037," says Asit C. Mehta's research report.


SKP Securities on Shree Cements - Target Rs 900

SKP Securities has maintained its buy rating on Shree Cements with a target of Rs 900 in its research report. "Net sales were up by 25.6% to Rs 665.4 crores in Q3FY09 over Q3FY08. PAT up by 269% on y-o-y basis at Rs 129.3 crores in Q3FY09. We maintain our BUY recommendation on the stock with a target price of Rs 900 at 8x FY10E earnings in 12 months against the current valuation of 4.5x FY10E earnings," says SKP Securities' research report.


ULJK Securities on Glenmark Pharma - Target Rs 191

ULJK Securities has maintained its buy rating on Glenmark Pharma with a target of Rs 191 in its research report. "Net revenue of Rs 5813.9 million was 39% short of our estimate while EBITDA saw a sharp decline of 47% YoY mainly on account of sharp currency devaluation and delay in US product approvals. We believe that the company’s growth will be hampered because of global slowdown and increasing interest rate scenario. We cut our EPS target for FY10 by 27% and reiterate a Buy with a target price of Rs 191 (from Rs 430)," says ULJK Securities' research report