Buy PSL, target of Rs 500: Religare

Religare Research has maintained its buy rating on PSL with a target price of Rs 500 in its July 16, 2008 research report."Net sales increased by 59% YoY to Rs 6.5 billion on the back of strong volume growth (+32.8%) and Rs 600 million of additional revenue contribution from the sale of pipe manufacturing mill to the US subsidiary. EBITDA increased by 46.2% YoY and 24% QoQ to Rs 594 million. EBITDA margins expanded by 180bps QoQ to 9.1%. Adjusted PAT increased by 52% YoY and 41.1% QoQ to Rs 260 million. Adj. PAT margins expanded by 120 bps QoQ to 4%."

"At the CMP of 310, the stock trades at 9.0x FY09E diluted earnings. We maintain our Buy recommendation on the stock target of Rs 500," says Religare's research report.

Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

For further details click on attachment......