May 06, 2009, 04.45 PM IST | Source: Moneycontrol.com

Buy UB Engineering, target of Rs 90: Nirmal Bang

Nirmal Bang has recommended a buy rating on UB Engineering with a price target of Rs 90. UB Engineering reported a net sales of Rs 454.73 crore in FY 09 as against Rs 265.72 crore in FY 08 an increase of 71.1%.

Nirmal Bang has recommended a buy rating on UB Engineering with a price target of Rs 90 in its research report.

"UB Engineering reported a Net Sales of Rs 454.73 crore in FY 09 as against Rs 265.72 crore in FY 08 an increase of 71.1%. The results were in line with our expectation. We had projected Net Sales of Rs 491.4 crore in FY 09. The growth in revenue was mainly backed by strong order book. The company had an opening order book of Rs 450 crore during FY 09 and booked Rs 608.7 crore of fresh order during the year."

"We expect the company to achieve Net Sales Rs 584.6 crore, EBIDTA of Rs 47.1 crore and Adj. PAT of Rs 26.6 crore for FY 10. The stock trades at Price Earning Multiple 3.35x at the projected EPS of Rs 15.61 for FY 10. With a strong order book of Rs 604 crore the company has visibility for next 12 months. Margin is also expected to increase during FY 10 on account of higher revenue from direct orders with high margin. We recommend a BUY on the stock with a price target of Rs 90," says Nirmal Bang's research report.

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