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Muhurat picks for Samvat 2067: India Capital Markets

Published on Tue, Nov 02, 2010 at 17:20 | Source : Moneycontrol.com

Updated at Wed, Nov 03, 2010 at 12:55

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Muhurat picks for Samvat 2067: India Capital Markets

India Capital Markets has come out with its Muhurat Picks for Samvat 2067 (2010-11).

Allied Digital Services (ADSL): At the CMP of Rs 220, ADSL trades at a P/E of 7 & 6 on FY11E & FY12E EPS of ` 30.4 & ` 34.9 respectively. On a EV/ EBIDTA basis, the stock is available at a multiple of 1 & less than 1 on FY11 & FY12 estimate. We recommend a "BUY" on the stock.

Indosolar : At the CMP of Rs 26, Indosolar trades at a P/E of 6.6x on FY12 EPS estimates of Rs 3.9. On a EV/EBIDTA basis, the stock is available at a multiple of 10.6 & 4.2 on FY11 & FY12 estimates. We recommend a "BUY" rating on the stock with a long term view.

Hexaware Technologies : At the CMP of Rs 88, Hexaware trades at a P/E of 9.6x on CY11 consensus EPS estimates of Rs 9.2 & EV/ EBIDTA of 5.4x respectively .We recommend a "BUY" on the stock with a medium to long term view.

Godrej Properties (GPL): Given the kind of unique asset light business model & visibility of strong cash flow with JDA, GPL commands rich valuations to its peers & trades at a premium to its NAV of Rs 570. At the CMP of Rs 718, we recommend a "BUY" on the stock with medium to long term view.

Gitanjali Gems : At CMP of Rs 303 the stock trades at 7.5x of FY11 and 5.9x FY12 earnings at Rs 40.4 and Rs 51.1 respectively, which we feel is attractively priced. On EV/EBITDA basis, the stock currently trades at 8.5x and 6.9x of FY11 and FY12 EBITDA respectively. Accordingly we recommend a "BUY" in GIL with short to medium term view.

GIC Housing Finance (GICHF): In H1FY11, GICHF has registered strong growth in disbursements & has already achieved 60% of the target disbursements set for FY11 of Rs 8500 million. At the CMP of Rs 150, GICHF is trading with an EPS of Rs 13.6 & Rs 16.6 with a P/Ex of 11.0x and 9.0x on FY11E & FY12E respectively. Further assuming the stake sale proceeds accruing in Q3FY11, its book value would move up further by approximately Rs 14 for FY12 & hence it is available at very attractive levels of (1.6x PBAV of Rs 95 on FY12E). Thus, we recommend a " BUY" with a medium to long term view.

Canara Bank : At the CMP of Rs 742, Canara Bank trades at a P/E of 7.9x & 7.1x its FY11E & FY12E consensus EPS of Rs 93.5 & Rs 105.1 respectively. We recommend a "BUY" on the stock with a medium to long term view.

Bilcare : At the CMP of Rs 726, Bilcare trades at a P/E multiple of 10.9 and 7.4 on FY11E & FY12E consensus EPS estimates of Rs 66.7 and Rs 97.9 respectively. On EV/EBITDA basis the stock is available at a multiple of 7.5 and 5.6 on FY11E and FY12E consensus estimate. We recommend a "BUY" on the stock with short to medium term view.

Indraprastha Gas (IGL): At the CMP of Rs 325. IGL trades at a P/E of 17.3 and 14.8 on FY11E & FY12E consensus EPS estimates of Rs 18.9 and Rs 22.0 respectively. On EV/EBITDA basis the stock is available at a multiple of 9.1 and 7.5 on FY11E and FY12E consensus estimate. We recommend a "BUY" on the stock with medium to long term view.

Mahindra & Mahindra (M&M): At the current price of Rs 766, M&M is trading at 17x on FY11 & 14.7X on FY12 on consolidated earnings. On EV/EBIDTA multiple stock trades at 10.8x & 9.4x on FY11 & FY12 EBIDTA. We expect stock performance driven by growth in volumes across the segments. We recommend an "Accumulate" rating on the stock with a view to hold long term.

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To read the full report click on the attachment

Attachments : DiwaliMuhuratPicks_INDIACAPITAL_021110.pdf