Networth Capital is bullish on PSL and has recommended buy rating on the stock with a target of Rs 194, in its August 25, 2010 research report.
PSL Limited (PSL), a Rs 3941 crore (FY10) company, is one of the largest manufacturers of large diameter Helical Submerged Arc Welded (HSAW) pipes in India with global pipe manufacturing capacity at 1.775 mtpa. PSL has pipe mills at multiple & strategically coast based locations in Kandla, Chennai, Visakhapatnam, Jaipur, & Ahmedabad, along with Sharjah & North American facilities. Currently the stock is quoting at 4.9x and 3.8x on FY11E and FY12E EPS of Rs 26.5 and Rs 34.3 respectively. The current up move in price is explicably due to comparatively cheaper valuations than its close peers in pipe manufacturing segment. We upgrade our rating on PSL Limited to BUY at current levels with revised FY12 price target of Rs 194 (previous target-137), an upside of 45%," says Networth Capital research report.
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