Buy India Glycols; target of Rs 149: Bonanza

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Buy India Glycols; target of Rs 149: Bonanza

Bonanza is bullish on India Glycols and has recommended buy rating on the stock with a target of Rs 149 in its March 28, 2011 research report.

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RELATED NEWS Buy Punjab National Bank; target of Rs 1180-1200: Aditya Birla Money Buy Exide Industries; target of Rs 160: Hedge Equities Buy ITC; target of Rs 178: IIFL ALSO READ See previous views by Bonanza See what other Experts & Brokerages are saying about India Glycols See messages about India Glycols India Glycols BSE | NSE 31/05/12 Are Mutual Funds betting on India Glycols?

Bonanza is bullish on India Glycols and has recommended buy rating on the stock with a target of Rs 149 in its March 28, 2011 research report.

"India Glycols (IGL) manufactures petrochemicals such as MEG, Ethoxylates, Glycol ethers and other performance chemicals. IGL uses molasses as the feed stock. Its subsidiary, Shakumbari Sugar, is an integrated sugar manufacturing unit."

"IGL has reported improved financial results for Dec'10.Top line and PBDIT margin have increased YoY and QoQ. IGL manufacture's MEG and other chemicals thru the use of molasses. Its competitors use inputs derived from crude oil. With rising global crude prices, the company has an edge over its closest competitors. Molasses availability is likely to improve as the sugar production has been significantly higher in the sugar year 10-11. The price of MEG and Ethanol, have been in uptrend in the international market. Sales realizations are expected to improve in coming months. IGL exports extra neutral alcohol (ENA) to Middle East, Africa and Sri Lanka. The company's facilities have been approved and certified by international agencies like Det Norske Veritas (DNV). In order to reduce the dependence on chemicals, IGL is planning to diversify into other areas. Company has set up its own R&D and Application Development Centre to develop economic and cost effective customized products."

"The stock has given a price breakout with increased volumes on both the weekly and daily charts. Recently it has breached its 20 and 50 days SMA and is moving towards crossing its 200 days SMA level at 138, a confirmatory breakout above this level will make the stock bullish for long term perspective. RSI trading with upward bias also supports the bull run of the stock. We recommend a buy on the stock with stop loss at Rs 116 for the target of Rs 149," says Bonanza research report.

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