Buy Sujana Towers, target of Rs 202: Religare

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Religare Research has recommended a buy rating on Sujana Towers with a target price of Rs 202 in its June 16, 2008 research report. "Augmenting capacity at its Chennai plant by 100,000MT, taking total production to 228,000MT. Project funding fully tied up with operations on schedule to commence in September. The company expects to record a turnover of Rs 3 billion from Chennai in FY09 and Rs 4 billion in FY10. We expect the operating margin to be maintained at 15.5-16% owing to backward integration initiatives and entry into power transmission. Revenue and PAT estimated to grow at 31% and 44% CAGR respectively over FY08-FY10."

"Currently trades at a P/E of 6.4x and 4.5x on FY09E and FY10E FDEPS. The stock has corrected significantly post-January and offers an attractive entry point for investment," says Religare's research report.

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