Buy Videocon; target of Rs 313: Firstcall Research

“Videocon Industries, the 2.5 billion USD flagship company of the Videocon Group. Videocon's business consists of manufacturing, marketing & distribution of consumer electronics products and oil & gas extraction. The company's board has also approved to issue, offer and allot equity shares, on preferential basis. The company's board has revised the minimum floor price for conversion of the 5% (USD 90 million) and 4.5% (USD 105 million) FCCBs. The company has launched its mobile services in Mumbai, Chennai and many more circles. Videocon Industries Ltd has advises that M/s. Anadarko Petroleum Corporation (Anadarko), the Operator of block BM-C-30 offshore Brazil in the Campos Basin.”

“Price to book value of the company is expected to be at 0.96 x for FY10E and 0.88x for CY11E respectively. EPS of the company is expected to be at Rs 27.92 and Rs 27.02 for the earnings of FY10E and CY11E respectively. On the basis of EV/EBDITA, the stock trades at 2.84 x for FY10E and 3.08 x for CY11E. At the market price of Rs 272, the stock is trading at 9.74 x and 10.07 x for FY10E and CY11E respectively. We recommend ‘BUY’ in this particular scrip with a target price of Rs 313 for medium to long term investment,” says Firstcall 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.