Reliance Industries Ltd.:
The company has achieved outstanding performance during Q2FY17 with strong refining business performance and record petrochemicals segment earnings. Refining business sustained high profitability in a tough environment highlighting, dynamic response to market trends and robust operations. Petrochemicals segment gained significantly from higher volumes, integration and supportive product margins. Its projects in the hydrocarbon chain are at advanced stages of mechanical completion and precommissioning activities. These projects would further strengthen its position as a leading operator in the energy and materials businesses, thus we expect the stock to see a price target of Rs.1255 in 8 to 10 months time frame on a target 3 year average P/E of 13.18x and FY18 (E) earnings of Rs.95.21.
The company is the most preferred power company and rationalization of movement of coal to reduce electricity costs, and rationalization of coal grades based on Gross Calorific Value for correct tariff fixation would give further lead to transformational changes in power sector . Moreover , it had added 4028 MW of renewable capacity , which highlights the accelerating speed of solar and wind capacity addition along with conventional capacity. Thus we expect the stock to see a price target of Rs 185 in 8 to 10 months time frame on an expected P/E of 14x and FY18 (E) earnings of Rs.13.22.
POWER GRID CORPORATION OF INDIA LIMITED:
Strong project execution capabilities, history of meeting targets and visibility on investment plans for next few years gives comfort on earning visibility . Company continues to take various initiatives for development of Smart Grid in India and is constantly enhancing its abilities through inhouse research and demonstration projects in this direction. Thus, it is expected that the stock will see a price target of Rs.226 in 8 to 10 months time frame on a target P/E of 13x and FY18 (E) earnings of Rs.17.41.
Government’s greater emphasis on ‘Make in India’ initiative in Defence sector provides a great opportunity for the Company to enhance its indigenisation efforts and to address the opportunities in Indian Defence sector . Heal thy order book and orders i n pi pel i ne, capaci tyenhancements and creation of new test facilities help the company in achieving the targeted growth and also would continue to drive the growth in the coming 4 to 5 years. Thus, we expect the stock to see a price target of Rs 1696 in 8 to 10 months time frame on a two year average P/E of 24.04 and FY18 (E) earnings of Rs.70.53.
P I Industries Limited:
Continued focus on quality of operations, strong order book position and growth on the domestic front helped the company to hold on to the margins and has significantly improved its working capital situation. With emphasis on cash, the company is now to a near to zero debt status. Improved demand in exports, advancement of orders from global customers and improved product mix would improve the consumption pattern, which would guide the financial strength of the company . Thus, it is expected that the stock will see a price target of Rs.1107 in 8 to 10 months time frame on a expected P/E of 32x and FY18 (E) earnings of Rs.34.60.
The company enjoys a global leadership positions in textiles as well as Carries an unmatched domestic portfolio of apparel brands and retail formats. Company’s capability in manufacturing garments, coupled with its positioning of the most preferred franchisee/distribution partner in India, it is poised to benefit from an increase in demand for apparels, thus it is expected that the stock will see a price target of Rs.412 in 8 to 10 months time frame on three year average P/E of 19.52x and FY18 (E) earnings of Rs.21.13.
JB CHEMICALS & PHARMACEUTICALS LIMITED:
With the company's manufacturing infrastructure of international standard, strong products portfolio with high growth brands, strong marketing capability and strong balance sheet present good outlook for the company's business. Moreover , the company continues to invest in products, people and processes to achieve its growth objective, thus we expect the stock to see a price target of Rs.494 in 8 to 10 month’s time frame on a target P/E of 19x and FY18 (E) earnings of Rs.25.98.
NAVNEET EDUCATION LIMITED:
The company has been a pioneer in catering to educational publications. Stability in earnings and reducing equity risk premiums would support valuation. The company is entering newer states. In addition to its own publications, it is also looking at healthy growth from government orders. Thus, it is expected that the stock will see a price target of Rs.131 in 8 to 10 months time frame on a target P/E of 17x and FY18 (E) earnings of Rs.7.71.
SUPRAJIT ENGINEERING LIMITED:
The company is the most preferred manufacturer of cables and meets the demand of virtually every major OEM in the automotive sector . It would more focus on cables in the export market for better positioning. Steady demand from specific OEMs and the shoring up of control-cable growth in the auto and non-auto markets, exports and replacements would guide the further growth to the company . Thus we expect the stock to see a price target of Rs 224 in 8 to 10 month’s time frame on an expected P/E of 21x and FY18 (E) earnings of Rs.10.65.
GUJARAT INDUSTRIES POWER:
The company is well placed in terms of fuel security , with the entire fuel requirement met by captive lignite mines. Further , power generated by the company has assured offtake through power purchase agreements (PP As) signed under the cost-plus model, ensuring fixed Return on Equity of Plant Availability Factor (P AF) for lignite and gas-based plants. Moreover , expansions and development; favourable government pocilies would give favourable boost to the company . Thus we expect the stock to see a price target of Rs 116 in 8 to 10 months time frame on an target P/E of 9x and FY18 (E) earnings of Rs.12.90.
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