ICICI Securities has maintained its buy rating on Sesa Goa with a price target of Rs 6300 in its April 29, 2008 research report. "Sesa Goa’s Q4FY08 results beat expectations, with stellar 207% YoY net profit growth on the back of record quarterly iron-ore sales of 5mnte. Revenues were up 108% YoY and 140% QoQ to Rs 17.1 billion. EBITDA increased 208% YoY and 61% QoQ to Rs 12.2 billion with EBITDA margin at 71%."
"We are revising our FY08E, FY09E and FY10E earnings estimates upwards 18.7%, 52.5% and 62.8% respectively, given high earnings trajectory on the back of: i) positive volume surprise in the quarter as well as FY08 (12.44mnte) combined with volume guidance of 25-30% increase per annum, ii) robust pricing scenario via increased spot sales mix and 65% price increase in contract sales. Post achieving our earlier price target of Rs 3,989 per share, we are upgrading our price target to Rs 6300 per share based on FY10E P/E and EV/EBITDA of 8x and 3.9x respectively. Maintain BUY," says I-Sec's research report.
"We are revising our FY08E, FY09E and FY10E earnings estimates upwards 18.7%, 52.5% and 62.8% respectively, given high earnings trajectory on the back of: i) positive volume surprise in the quarter as well as FY08 (12.44mnte) combined with volume guidance of 25-30% increase per annum, ii) robust pricing scenario via increased spot sales mix and 65% price increase in contract sales. Post achieving our earlier price target of Rs 3,989 per share, we are upgrading our price target to Rs 6300 per share based on FY10E P/E and EV/EBITDA of 8x and 3.9x respectively. Maintain BUY," says I-Sec's research report.
Angel Broking has recommended an accumulate rating on Hindustan Unilever with a target price of Rs 276 in its April 29, 2008 research report. "For 1QCY2008, Hindustan Unilever (HUL) posted a solid Topline growth of 19.1% yoy (highest quarterly growth since 2002) to Rs 3,794 crore (Rs 3,184 crore), beating our expectation of 14.7% growth to Rs 3,652 crore. Topline growth was largely led by a strong 19.4% growth (volume growth of 10.2%) in the company’s core FMCG business backed by 19.9% growth in the Soaps/Detergents segment (aided by price hikes and marketshare gains in the Laundry segment) and 23.5% growth in Personal Products segment (aided by low base, extended winter and re-launch of several brands).
"We have revised our Target Price upwards to Rs 276 (Rs 237) as we introduce CY2009E numbers and assign a P/E multiple of 25x to our CY2009E EPS of Rs11.1. We believe HUL’s accelerated sales growth momentum, revival in its Personal Products portfolio and scale up of new businesses would help it sustain premium valuations. While inflationary pressures remain a key cause of concern, we believe HUL is well placed to combat such pressures owing to its cost saving initiatives, wide product portfolio mix and ability to undertake price hikes owing to strong brands. At the CMP of Rs251, the stock is trading at 22.7x CY2009E EPS of Rs11.1 and 21.5x EV/EBITDA. We recommend an Accumulate rating on the stock, with a revised Target Price of Rs 276 (Rs 237), says Angel's research report"
IndiaInfoline has recommended a buy rating on Bharti Airtel with a target price of Rs 1123 in its April 28, 2008 research report. "The company's revenues increased by 13.1% qoq driven by 12.4% qoq subscriber growth; FY08 subscriber added up 67%. Q4 wireless margins fell by 360 bps yoy on transfer of passive infrastructure to Infratel. Q4 PAT was higher by 32.9% qoq on lower interest cost."
"We value Bharti’s core wireless business on a DCF basis with 12. 1% WACC and terminal growth of 3% for a price of Rs 943. With Infratel and Indus combine likely to add about 35000 towers in FY09 and assured tenancy on Indus, the tower JV, we put the value of tower arm at USD 8.7 billion, or Rs 180 per share of Bharti. At our target price of Rs 1123, Bharti trades at a P/E of 18.3x and EV/EBIDTA of 8.3x FY10E earnings. As network coverage reaches a majority of population, mobile capex would gradually decline which implies company would have significant free cash flows going forward (estimated USD 3.1 billion by FY10) that could be used for inorganic growth or to bid aggressively in 3G auctions. Recommend BUY," says IndiaInfoline's research report.
