Firstcall Research is bullish on Premier and has recommended buy rating on the stock with a target of Rs 113 in its February 12, 2013 research report.
“Premier is engaged in the manufacture of automobiles and machine tools which is incorporated in the year 1944, Premier was first Indian company to start making automobiles. The company collaborated with Chrysler Corporation, USA to manufacture Dodge cars at its Kurla plant and rolled out India’s first car. Later it was collaborated with Fiat SpA, Italy to commence assembly of Fiat 500 in India. In 1954 Fiat 1100 came in into market becoming one of the most popular models produced. Gradually the company undertook highly specialized jobs. Premier has manufactured widest range of commercial vehicles, which includes Premier Padmini - one of the popular cars in India. The company firsts to its credits manufactured commercial vehicles under the brand Dodge and Fargo for defence department of the Government of India. Premier Ltd is the first company to introduce diesel taxis in Mumbai; Premier introduced the concept of Cool Cabs (A/C taxis) in Mumbai city and first Indian passenger car company to set up a Press plant at its Dombivli plant, in western India. The company has received the ISO 9001 certification for quality management.”
“Premier Ltd is the pioneer of automobile manufacturing in India rapidly gaining stature in both its segments: Engineering and Automotive, reported its financial results for the quarter ended 31st Dec, 2012. The company’s net profit jumps to Rs.86.80 million against Rs.35.60 million in the corresponding quarter ending of previous year, an increase of 143.82percent. Revenue for the quarter sustained same at Rs.600.90 million when compared with the prior year period. Reported earnings per share of the company stood at Rs.2.86 a share during the quarter, registering 143.82percent increase over previous year period. Profit before interest, depreciation and tax is Rs.219.80 millions as against Rs.177.40 millions in the corresponding period of the previous year.”
“At the current market price of Rs 101, the stock P/E ratio is at 10.76 x FY13E and 9.12 x FY14E respectively. Earning per share (EPS) of the company for the earnings for FY13E and FY14E is seen at Rs.9.39 and Rs.11.08 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 8percent and 22percent over 2011 to 2014E respectively. On the basis of EV/EBITDA, the stock trades at 6.66 x for FY13E and 5.90 x for FY14E. Price to Book Value of the stock is expected to be at 0.42 x and 0.40 x respectively for FY13E and FY14E. We recommend ‘BUY’ in this particular scrip with a target price of Rs 113 for medium to long term investment,” says Firstcall Research report.
FIIs holding more than 30% in Indian cos
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