Buy Bayer CropScience; target Rs 942: Firstcall Research

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Buy Bayer CropScience; target Rs 942: Firstcall Research

Firstcall Research is bullish on Bayer CropScience and has recommended buy rating on the stock with a target of Rs 942 in its September 22, 2011 research report.

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Firstcall Research is bullish on Bayer CropScience and has recommended buy rating on the stock with a target of Rs 942 in its September 22, 2011 research report.

"Bayer CropScience, headquartered in Monheim, Germany, is a subgroup of Bayer AG is one of the world's leading crop science companies in crop protection, non-agricultural pest control, seeds and traits. During the quarter ended, the robust growth of Net Profit is increased by 1.57% Rs. 498.80 million. Bayer CropScience has received approval for its herbicide tolerant soybean technology from the National Ministry of Agriculture in Argentina. The Company has a global workforce of 20,700 and is represented in more than 120 countries. Net Sales and PAT of the company are expected to grow at a CAGR of 21% and 9% over 2010 to 2013E respectively."

"Bayer Cropscience has reported net profit of Rs 498.80 million for the quarter ended on June 30, 2011 as against Rs 491.10 million in the same quarter last year, an increase of 1.57%. It has reported net sales of Rs 7909.40 million for the quarter ended on June 30, 2011 as against Rs 7206.80 million in the same quarter last year, a rise of 9.75%. Total income grew by 10.30% to Rs 8011.80 million from Rs 7263.90 million in the same quarter last year. During the quarter, it reported earnings of Rs 12.63 a share."

"At the current market price of Rs.834.00, the stock is trading at 23.03 x FY12E and 20.22 x FY13E respectively. Earning per share (EPS) of the company for the earnings for FY12E and FY13E is seen at Rs.36.22 and Rs.41.24 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 21% and 9% over 2010 to 2013E respectively. On the basis of EV/EBITDA, the stock trades at 12.64 x for FY12E and 11.12 x for FY13E. Price to Book Value of the stock is expected to be at 4.04 x and 3.37 x respectively for FY12E and FY13E. We expect that the company will keep its growth story in the coming quarters also. We recommend 'BUY' in this particular scrip with a target price of Rs 942 for Medium to Long term investment," says Firstcall research report.

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To read the full report click on the attachment