Phillips Carbon Black is well poised to benefit from the rising demand for tyres going ahead. Moreover, we expect Phillips Carbon Black’s power segment to start contributing substantially to its bottom-line in FY2011 and FY2012 and provide stability to its earnings. We have valued Phillips Carbon Black on the sum-of- the parts valuation methodology and arrived at a Target Price of Rs270 wherein we have valued Phillips Carbon Black’s carbon black segment at Rs144//share (1x FY2012E P/BV) and the power segment at Rs126/share (NPV method)
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EVEREST KANTO CYLINDERS – Kotak Securities Research Report
EVEREST KANTO CYLINDERS has underperformed the markets over past four months as it has declined by 12% as against 5% rise in SENSEX during the same period. We feel this is due to concerns regarding its high cost inventory and lower off take form OEM segment. However now the high cost inventory is almost over and also the supplies to OEM have picked up. Thus we expect the stock of EVEREST KANTO CYLINDERS to get rerated going forward
READ MORE »Mphasis – Parag Parikh Research Report
Mphasisreported a good third quarter. Revenue on YoY basis increased by ~15% whereas on QoQ basis increased by ~4%. The YoY PAT growth was around 18%. Margins have declined slightly over the last quarter and by a wider margin over the same period last year. Since the rate card is negotiated every six months, the current impact can be seen due to the recent negotiations during the second quarter of FY10.
READ MORE »Unity Infraprojects – Kotak Securities
Unity Infraprojects is well poised to maintain its growth trajectory and tap the upcoming opportunities in infrastructure segments. Company has highlighted its strategy which will help in sustaining its future growth. We present the key highlights below: Strategies to grow in future n De-risked business model – Unity Infraprojects has been able to grow its order book at a CAGR of 28% in past five years. The company was initially more a civil construction player but over a period of time, it has enhanced its presence across other verticals such as irrigation, water supply, transportation and engineering. Thus it now has a de-risked business model with a strong order book that provides revenue visibility for next 2 years. It would continue to focus on projects across segments to maintain diversified order book.
READ MORE »Greaves Cotton Ltd – Kotak Securities
Greaves Cotton is one of the largest makers of light diesel engines in the world. Over the years, the company’s focus on R&D has resulted in an efficient product which is gaining acceptance with OEMs. GCL has been made the sole supplier of engines to Tata Motors’ 4W LCV “Penguin”, which is in the launch phase. The company’s prime client, Piaggio (PVPL), has been a focused player in light transportation and has seen its 3W volumes grow 29% in 9M FY10. We believe higher demand from rural sector and increasing preference of light vehicles for intra-city transportation should drive growth in the 3-4W (sub 1 ton) auto segment. The company’s infrastructure equipment division is expected to turnaround in FY11. We feel GCL is an ideal stock to play the development of light cargo transportation in the country. Valuations at 12x is not demanding. BUY
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