Asit C. Mehta has recommended hold rating on Sanghvi Movers with a target of Rs 201 in its June 11, 2010 research report.
"For 4QFY10, Sanghvi Movers Ltd's (SML) revenue fell by 9.2% YoY to Rs 857.4 million. Operating profit margin stood at 77.2% and net profits declined by 2.6% YoY to Rs 249.2 million. For FY10, net sales increased by 7.8% YoY to Rs 3575 million. In spite of crane additions, moderate growth in sales was owing to lower utilization levels and drop in yield. Six heavy-duty cranes (600 MT and above) remained idle for almost 5 to 6 months during FY10. Operating profit margin stood at 76.6% in FY10 vs 76.2% in FY09. Net profits increased by 11.8% YoY to Rs 1010.5 million. We expect net sales to increase at a CAGR of 11% to Rs 4086.5 million in FY12E and EPS to increase to Rs 25.1 in FY12E, driven by addition of new cranes. At CMP of Rs 185, SML is trading at 8.3x FY11E earnings and 7.4x FY12E earnings. Looking at one-year forward P/E chart, we assign 8x and recommend a hold with a price target of Rs 201," says Asit C. Mehta Investment Interrmediates 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.
