Buy Bajaj Holdings; target of Rs 999: Sharekhan

12452 Investors following Bajaj Holdings. Share this News with them.

0

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

Buy Bajaj Holdings; target of Rs 999: Sharekhan

Sharekhan is bullish on Bajaj Holdings & Investment and has recommended buy rating on the stock with a target of Rs 999 in its August 4, 2011 research report.

Post your opinion here

 

0

Tweet

Share on Tumblr

RELATED NEWS Accumulate Ipca Labs; target of Rs 358: Angel Broking Accumulate IOB; target of Rs 155: Angel Broking Accumulate Mphasis; target of Rs 482: Angel Broking ALSO READ See previous views by Sharekhan See what other Experts & Brokerages are saying about Bajaj Holdings See messages about Bajaj Holdings Bajaj Holdings BSE | NSE 31/05/12 Are Mutual Funds betting on Bajaj Holdings?

Sharekhan is bullish on Bajaj Holdings & Investment and has recommended buy rating on the stock with a target of Rs 999 in its August 4, 2011 research report.

"Bajaj Holdings & Investments Ltd (BHIL) was created out of the demerger scheme of Bajaj Auto, and primarily functions as an investment company which currently holds stake in various group companies namely Bajaj Auto, Bajaj Finserv and Maharashtra Scooters. For Q1FY2012 the consolidated revenue stood at Rs78.5 crore as compared to Rs146.2 crore in Q1FY2011. The 46% decline in the revenues was primarily on account of lower profits on sale of investments at Rs9.6 crore as against Rs87.7 crore in Q1FY2011. Despite a sharp decline in revenues, the consolidated net profits declined marginally by 2% primarily on account of a 32% increase in the share of profits from associates to Rs272 crore. BHIL holds Rahul Bajaj Group's strategic investments in Bajaj Auto, Bajaj Finserv, Bajaj Auto Holdings and Maharashtra Scooters; other investments in equity markets and investments in government securities, bonds, debentures and mutual funds. The value of investments as on June 30, 2011 is given below."

"For Q1FY2012, Bajaj Auto and Bajaj Finserv reported healthy numbers. However we have reduced our target price for Bajaj Auto to factor for macro headwinds that are likely to hit going forward. We value Bajaj Holdings based on our target price for Bajaj Auto and on the base case scenario for Bajaj Finserv and other group companies on cost; and give a holding company discount of 50% for the same. Furthermore, the company has cash and liquid investments worth Rs5,474 crore on its balance sheet. However, we value these investments giving it a 40% discount on account of its volatile nature. Consequently we arrive at a fair value of Rs999 for the stock (based on company's fully diluted equity), which is significantly above its current market price of Rs765. We therefore maintain our Buy recommendation on the stock with a revised price target of Rs 999," says Sharekhan research report.  

FIIs holding more than 30% in Indian cos

Disclaimer: The views and investment tips expressed by investment experts 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