IL&FS Transportation Networks / ITNL: ShareKhan Research Report

In terms of the financials, IL&FS Transportation Networks / ITNL has displayed a stupendous growth in its revenue and bottom line (CAGR of 133% and 89% respectively) over FY2007-10. Going ahead, we believe with the increase in the toll/annuity income and the new project execution the revenue and bottom line is expected to grow at a CAGR of 46% and 30% respectively over FY2010-12. Thus, we initiate coverage on IL&FS Transportation Networks / ITNL stock with a Buy recommendation. Our SOTP price target of Rs 452 provides a 25% upside from the current market level. At the current market price the IL&FS Transportation Networks / ITNL stock trades at a P/E of 12.2x its FY2012E earnings