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Jun 14, 2012, 06.43 PM IST | Source: Moneycontrol.com

Buy PI Industries; target of Rs 593: Firstcall Research

Firstcall Research is bullish on PI Industries and has recommended buy rating on the stock with a target of Rs 593 in its June 13, 2012 research report.

Firstcall Research is bullish on PI Industries and has recommended buy rating on the stock with a target of Rs 593 in its June 13, 2012 research report.

“PI Industries Ltd (PI) was incorporated in 1947 (as Mewar Oil & General Mills Ltd.) with its registered office in the lake city of Udaipur, Rajasthan. In January 2011 PI set up a joint research laboratory with one of the largest electronics companies in the world M/s. Sony Corporation of Japan for developing processes for electronic chemicals at Udaipur. The Corporate office is located in Gurgaon (Haryana), with the R&D set up at Udaipur, and the manufacturing sites at Panoli near Ankleshwar (Gujarat State), and Jammu (J&K state). A new manufacturing site is coming up at Jambusar (Gujarat).”

“P.I. Industries Ltd has reported net profit of Rs 217.84 million for the quarter ended on March 31, 2012 as against Rs. 203.83 million in the same quarter last year, an increase of 6.87%. It has reported net sales of Rs 2352.72 million for the quarter ended on March 31, 2012 as against Rs 2125.86 million in the same quarter last year, a rise of 10.67%. Total income grew by 11.51% to Rs 2370.52 million from Rs.2125.86 million in the same quarter last year. During the quarter, it reported earnings of Rs 8.70 a share.”

“At the current market price of Rs 525, the stock is trading at 10.75 x FY13E and 9.14 x FY14E respectively. Earning per share (EPS) of the company for the earnings for FY13E and FY14E is seen at Rs.48.86 and Rs.57.42 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 18% and 31% over 2011 to 2014E respectively. On the basis of EV/EBITDA, the stock trades at 6.05 x for FY13E and 5.26 x for FY14E. Price to Book Value of the stock is expected to be at 2.99 x and 2.25 x respectively for FY13E and FY14E. 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 593 for medium to long term investment,” says Firstcall Research report.

FIIs holding more than 30% in Indian cos

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