PINC Research has maintained its buy rating on Pratibha Industries with a 12-month price target of Rs 480 in its May 8, 2008 research report. "Pratibha Industries Ltd’s (PIL’s) sales doubled to Rs 2.2 billion in Q4FY08. This was on back of a strong order book and increasing contribution from its HSAW pipes division. However, surge in raw material cost/sales by 478 bps led to a slide in OPM to 10.3%. This along with higher depreciation contained net profit growth to 61% at Rs 103 million. PIL’s current order book (core construction business) stands at Rs 20 billoion, with major chunk (60%) being accounted for by Water Management Projects (WMPs). While urban infrastructure projects constitute 32% of the order book, road projects account for the balance."

"At the CMP of Rs 327, PIL trades at a P/E of 8.2x and EV/EBIDTA of 5.9x FY10E earnings. A healthy order book, strong presence in WMPs and revenues from the pipe manufacturing should enable PIL to capitalise on opportunities in the infrastructure sector. We maintain a ‘BUY’ recommendation with a 12-month price target of Rs 480," says PINC research report.

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