Buy Repro India; target Rs 220: Sunidhi Securities

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Buy Repro India; target Rs 220: Sunidhi Securities

Sunidhi Securities is bullish on Repro India (RIL) and has recommended buy rating on the stock with a target price of Rs 220 in its February 1, 2012 research report.

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Sunidhi Securities is bullish on Repro India (RIL) and has recommended buy rating on the stock with a target price of Rs 220 in its February 1, 2012 research report.

"Repro India (RIL), sales during Q3FY12 rose 4.5% to Rs 79.8 crore (Rs 76.4 crore). PBIDT at Rs 15.0 crore (Rs 9.7 crore) rose 54.6%. Net profit advanced 56.6% to Rs 8.3 crore from Rs 5.3 crore in Q3FY11. (YoY). OPM stands enhanced to 18.8% from 12.7% and PAT margin moved up to 10.4% from 6.9% in Q3FY11. EPS for Q3FY12 stands at Rs 8.8 Vs Rs 4.8 in Q2FY11. Sales during 9MFY12 rose 21.3% to Rs 227.7 crore (Rs 187.7 crore). PBIDT at Rs 40.9 crore (Rs 25.5 crore) rose 60.4%. Net profit rose 98.5% to Rs 26.4 crore from Rs 13.3 crore in 9MFY11 (YoY). OPM enhanced to 18.0% from 13.6% and PAT margin moved up to 11.6% from 7.1% in 9MFY11. EPS for 9MFY12 stands at Rs 24.7 Vs Rs 12.5 in 9MFY11."

"The company currently serves 100 clients in India and 55 overseas. Recently it has added UK and US based Baker & Taylor, BPP and Random House to its client list. The print and publishing industry is estimated to grow at a conservative CAGR of 10% during 2099-13. In publishing segment, educational and academic books constitute 70%. The global print market is estimated to have grown from $61 billion to $72 billion by 2011. Indian print and publishing sector aggregates to $5.6 billion (Print media $3.4 billion and $2.2 billion publishing). India has a healthy consumption of books. The book demand in India is propelled by the GDP growth, the reading habits of the burgeoning Indian middle class, increase in literacy rates and young and knowledge hungry population. All this spells good prospects for RIL going forward. RIL's top line has grown and efficiencies have improved in both the plants with a lot of automation happening. Underwent expansion gives solid revenue visibility. At CMP of Rs 192, the share is trading at a P/E of 5.8x on FY12E. In view of the robust Q3FY12 and 9MFY12 results, we are upgrading our profit projections for FY12 and accordingly revise our target price upward to Rs 220 at which the share will trade at a P/E of 6.7x. Buy the stock," says Sunidhi Securities research report.

Non-Institutions holding more than 90% in Indian cos

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To read the full report click on the attachment