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Buy Dhampur Sugar Mills; target of Rs 162: LKP Shares
LKP Shares is bullish on Dhampur Sugar Mills and has recommended buy rating on the stock with a target of Rs 162 providing an potential upside of 22%, in its November 30, 2009 research report.
LKP Shares is bullish on Dhampur Sugar Mills and has recommended buy rating on the stock with a target of Rs 162 providing an potential upside of 22%, in its November 30, 2009 research report.
"India started the current crushing season with a decade low closing stock. Further, we expect the sugarcane production to remain muted for another year, continuing the upward movement in the sugar cycle. We, thus maintain our BULLISH OUTLOOK on the sector. Dhampur Sugars, an integrated sugar mill, is expected to post a growth of ~73% YoY on the back of ~33% increase in realization & ~14% growth in the sales volume due to better yield & better recovery vis-à-vis previous year. Dhampur's power business is expected to report ~25% growth YoY, on account of new power policy announced by UP government."
"At the CMP of Rs 133 Dhampur is attractively trading at 7.4x its FY10E EPS of Rs 18. We recommend a BUY on the stock, with a PRICE TARGET OF RS 162 providing an potential upside of 22%. At our price target the stock would be trading at 9x its FY10E earnings," says LKP Shares.
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