Feb 14, 2017 06:13 PM IST | Source: Moneycontrol.com

Buy Crompton Greaves; target of Rs 82: HDFC Securities

HDFC Securities is bullish on Crompton Greaves has recommended buy rating on the stock with a target price of Rs 82 in its research report dated February 11, 2017.

Buy Crompton Greaves; target of Rs 82: HDFC Securities

HDFC Securities' research report on Crompton Greaves

Crompton Greaves (CRG) reported quarterly numbers in line with estimates. SA revenue grew 10% YoY, led by 16.2%/5.6% growth in the industrial / power segment. SA EBITDA margin at 6.6% (+140bps YoY) is also in line with our estimates. CRG has realigned the international power business into 5 entities (geography wise) to now sell it in piecemeal manner.

Outlook

We continue to be buyers in CRG as we believe the SA business is on the uptrend (sustained visibility on T&D and railway capex and current valuations factor in losses in international operations). Reiterate BUY with a SOTP-based TP of Rs 82/share (15x Dec-18E EPS for SA, Rs 11/share for subsidiaries).

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