Buy ILandFS Investment: PPFAS

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Buy ILandFS Investment: PPFAS

Parag Parikh Financial Advisory Services (PPFAS) is bullish on ILandFS Investment Managers and has recommended buy rating on the stock in its July 28, 2011 research report.

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Parag Parikh Financial Advisory Services (PPFAS) is bullish on ILandFS Investment Managers and has recommended buy rating on the stock in its July 28, 2011 research report.

"ILFSVC has reported a mixed set of numbers for the quarter ended June 2011 as per expectations. For Q112, company has reported consolidated income of Rs 517Mn v/s Rs 430Mn, a 20% Y-Y growth, but a 3% Q-Q de-growth. Growth in AUM and topline is reflected in the enhanced numbers for the current quarter. However, same is not translated into growth in profits due to expenses and amortisation of the consideration paid for the Saffron amalgamation, thus the results are not strictly comparable with the corresponding quarter of last year as it was done in August 2010."

"Staff cost as a % of sales for the current quarter has seen a rise of 23bps Y-Y to 25%, which includes 8% salary increment Ÿ Reported PAT for Q1FY12 was at Rs 172Mn as against Rs 177Mn for Q1FY11 (3% Y-Y de-growth) Ÿ EPS reported for the quarter ended June 2011 was Rs 0.84/- as compared to Rs 0.87/- for the quarter ended June 2010."

"At CMP of Rs 32.4/-, the scrip is trading at 9.7x TTM earnings of Rs 3.4/- per share. We continue to have a positive outlook on the business having assured revenues with fantastic economics despite a poor performance of the stock price on account of real estate concerns. This was adequately proved by the company's successful exits and investment track record in FY11 as well as the current quarter of FY12. We believe ILFSVC can generate excellent returns for the shareholders over the long term, thereby maintaining our 'BUY' recommendation," says Parag Parikh Financial Advisory Services research report.

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To read the full report click on the attachment