Accumulate United Phos; target of Rs 175: P Lilladher

11751 Investors following United Phos. Share this News with them.

0

Like this story, share it with millions of investors on M3

Accumulate United Phos; target of Rs 175: P Lilladher

Prabhudas Lilladher is bullish on United Phosphorus (UPL) has recommended accumulate rating on the stock with a target price of Rs 175 in its January 30, 2012 research report.

Post your opinion here

 

0

Tweet

Share on Tumblr

RELATED NEWS Motilal Oswal neutral on Bank of Baroda Buy HDFC Bank; target of Rs 503: IIFL Buy IFB Agro Industries; target Rs 216: Sunidhi Securities ALSO READ See previous views by Prabhudas Lilladher See what other Experts & Brokerages are saying about United Phos See messages about United Phos United Phos BSE | NSE 30/05/12 Are Mutual Funds betting on United Phos?

Prabhudas Lilladher is bullish on United Phosphorus (UPL) has recommended accumulate rating on the stock with a target price of Rs 175, in its January 30, 2012 research report.

"United Phosphorus (UPL) came out with its Q3FY12 result. Net sales was ahead of our as well as consensus estimate, while PAT was lower than our expectation. Management is maintaining its FY12 revenue growth guidance of 35-40% YoY, with EBITDA (incl. other income) margin of 19-20%. We still prefer Rallis India (Rallis) over UPL on account of better management, strong balance sheet, better PAT FY11-14 CAGR and return ratios."

"UPL's net sales grew by 57.8% YoY to Rs19.3bn (PLe: Rs16.5bn), mainly on account of strong volume growth of 31% YoY. Further, it has been supported by price (rate) growth and exchange variation of 8% and 19% YoY, respectively. All the geographies have shown strong performance on YoY basis during Q3FY12. Company has acquired Rice CO LLC and DVA Agro business in the past 12 months that has contributed 31% to overall sales growth (i.e. 57.8% YoY). UPL's EBITDA grew by 57.5% to Rs3.5bn (PLe: Rs3.2bn). EBITDA margin stood at 18.1% (PLe:19.5%). Company's staff cost has gone by 50.2% YoY to Rs1.9bn (up 28.9% QoQ) because of recent acquisitions. DVA Agro has contributed for ~1.5months during Q2FY12 v/s three months in Q3FY12 and partially due to exchange variation."

"We are downward revising our FY12/FY13 estimate by ~28%/21%, considering higher depreciation/interest/tax rate on account of UPL's recent acquisitions. Accordingly, we are downward revising our rating from 'BUY' to 'Accumulate', with the revised TP of Rs 175 (earlier Rs199). We still prefer Rallis over UPL on account of better management, strong balance sheet, better PAT FY11-14 CAGR and return ratios despite having premium valuation," says Prabhudas Lilladher research report.

Shares held by Mutual Funds/UTI

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies 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.

To read the full report click on the attachment