Buy South Indian Bank, target Rs 205: Sushil Finance

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Sushil Finance has recommended a buy rating on South Indian Bank , with price target of Rs 205, in its report dated February 8, 2010. The stock closed at Rs 136.80 on February 9, 2010.

"South Indian Bank is a good defensive stock with conservative but dynamic management, which is aptly reflected through its loan book constituents and good NPL management. Going forward, we expect its Net Profit to grow by 30%, Advance by 23% and Deposit by 18% in FY11E. The stock currently trades at 0.9x FY11E ABV and 4.6x FY11E earnings. We believe that the stock could trade at target ABV multiple of 1.4x on back of its strong business model. Reiterate 'BUY' rating on the stock with increased target price of Rs 205," says Sushil Finance report.

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