Buy Surya Roshni; target of Rs 140: Sunidhi Securities

2558 Investors following Surya Roshni. Share this News with them.

0

Like this story, share it with millions of investors on M3

Buy Surya Roshni; target of Rs 140: Sunidhi Securities

Sunidhi Securities is bullish on Surya Roshni and has recommended buy rating on the stock with a target of Rs 140 in its October 5, 2010 research report.

Post your opinion here

 

0

Tweet

Share on Tumblr

ALSO READ See previous views by Sunidhi Securities See what other Experts & Brokerages are saying about Surya Roshni See messages about Surya Roshni Surya Roshni BSE | NSE 31/05/12 Are Mutual Funds betting on Surya Roshni?

Sunidhi Securities is bullish on Surya Roshni and has recommended buy rating on the stock with a target of Rs 140 in its October 5, 2010 research report.

"Surya Roshni (SRL) has emerged as a formidable conglomerate with the largest ERW pipe manufacturing plant in India, a large cold rolling strip mill at Bahadurgarh (Haryana) and two lighting units one each at Kashipur (UP) and Malanpur (MP) producing fluorescent tube lights, GLS lamps, CFL lamps, HPSV lamps, HPMV lamps and metal halide lamps. SRL also markets a wide range of luminaires and accessories, high mast lighting systems, lighting poles, decorative poles and MCBs. At present, the company has eight million tonnes capacity in its steel division. SRL's 65% revenue comes from the steel division and balance 35% from the lighting division. SRL exports 20 per cent of its pipe production to 40 countries and claims to be the largest exporter of GI pipes."

"SRL has a non-listed Indian subsidiary named as Surya Global Steel Tubes (SGSL). As on FY10, SRL had a total investment of Rs 50 crore with 53.7% equity shares in the same. SGSL has started its commercial production of spiral pipe project with capacity of 60, 000 tpa in January, 2010 at Anjar, Bhuj in Gujarat. SGSL has proposed to set up a new project for production of API grade ERW Pipe at Bhuj. Having commenced three decades ago, the steel pipe division of SRL has grown in size and range to become a very large ERW pipe producer in the country producing about 5, 00, 000 tpa with sizes ranging from 15 mm NB to 400 mm NB, available both in galvanized and block condition."

"In view of the Government thrust on water, infrastructure and export sectors, there is tremendous scope for growth in the steel pipe and cold rolled industry. In cold rolling mill, SRL has plans to modernize some units, which will double the output to take care of the market needs. The luminaires business group of SRL has made good progress in the recent times by picking good orders for luminaries/HID lamps & high masts from established PSUs/Public Work Departments & local bodies as well as from a wide spectrum of industrial & commercial luminaires buyers. SRL is likely to post an EPS of Rs 23 in FY11 and Rs 26 in FY12. At the CMP of Rs 101, the share is trading at a P/E of 4.4x on FY11E and 3.9x on FY12E. We recommend BUY with a target of Rs 140 in the medium term," says Sunidhi Securities research report.

Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management.Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

To read the full report click on the attachment