Buy Bajaj Corp; target of Rs 270: AnandRathi

Tagged: Anand Rathi, Bajaj Corp

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July 1, 2014 at 9:46 pm #651

Vidhi Khanna
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AnandRathi is bullish on Bajaj Corp and has recommended buy rating on the stock with a target of Rs 270 in its July 1, 2014 research report.

Competition in almond-based hair oils is benign. Dabur’s Almond Hair Oil has failed to gain more than 4 percent market share. Also, Keo Karpin is not investing in pushing its brands. This has led to Bajaj Corp. gaining market share. The market-share ratio of Bajaj Corp. to Keo Karpin has risen from 4.34 to 4.44. We expect 13 percent earnings CAGR for the company in FY14-16. We value the stock at target price of Rs 270, at PE of 18x FY16e earnings. Also, we expect the success of Kailash Parbat and No Marks-acquisition to reduce dependence on Bajaj Almond Drops, erasing the ‘single-product-company’ tag.

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