Networth capital is bullish on PSL and has recommended accumulate rating on the stock with target of Rs 137 in its June 02, 2010 research report.
"Rise in crude oil and increased level of spending on exploration and production activities to keep the demand upbeat going forward. PSL's revenues are 98% domestic and thrust to set infrastructure for inter regional gas supply (gas trade) to boost demand in the long run. Replacement demand of old pipelines in US will also be a key driver."
"Currently, the stock is quoting at 3.6x and 3x on FY11E and FY12E EPS of Rs 33.4 and Rs 40.9 respectively. We recommend accumulate on PSL Limited at current levels with a FY11 price target of Rs 137, an upside of 13%. PAT has improved by 29.3% to Rs 122.7 crore with diluted EPS improving from Rs 21.9 to Rs 24.75. EBITDA has improved by 14.5% at Rs 355.1 crore while total income was steady at Rs 3993.6 an increase of 9.4%. The board has declared 40% total dividend for FY10 i.e. Rs 4 including Rs 2.5 interim dividend paid earlier during the year," says Networth Capital research report.
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