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Buy Madras Cement, tgt Rs 4000: Sharekhan
Sharekhan research has maintianed buy rating on Madras Cement with target price of Rs 4000. At the current market price of Rs2,712, the share trades at 7.5x and 6.4x its FY2009 and FY2010 earnings respectively .
Sharekhan research has maintianed buy rating on Madras Cement with target price of Rs 4000 in its June 02, 2008 report. "Going forward, the top line growth of the company will be driven primarily by the volume growth on the back of capacity additions being carried out by the company. However, we have revised our profit estimates for FY2009 downwards to factor in the higher input cost, and now expect the company's net profit to grow at 5.3% yoy. We have also introduced FY2010 earning estimates in this note and expect the company's net profit to grow 16.6% yoy in FY2010. At the current market price of Rs2,712, the share trades at 7.5x and 6.4x its FY2009 and FY2010 earnings respectively and an enterprise value (EV)/EBIDTA of 5.7x and 4x for FY2009 and FY2010 respectively. We maintain our Buy recommendation on the stock with a revised price target of Rs 4,000" according to Sharekhan report.
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