What is Emkay's call on IRB Infra, Mahindra Satyam, BHEL?

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What is Emkay's call on IRB Infra, Mahindra Satyam, BHEL?

Emkay Global Financial Services has come out with its report on different stocks.

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RELATED NEWS Buy IVRCL; target of Rs 78: Aditya Birla Money Sell Crompton Greaves; target of Rs 236: Aditya Birla Money Accumulate Tech Mahindra; target of Rs 770: PLilladher ALSO READ See previous views by Emkay Global Financial Services See what other Experts & Brokerages are saying about IRB Infra See messages about IRB Infra IRB Infra BSE | NSE 01/06/12 Are Mutual Funds betting on IRB Infra? Other Stocks in this news Lakshmi Machine Works | Bharat Heavy Electricals | Mahindra Satyam |

Emkay Global Financial Services has come out with its report on different stocks.

IRB Infra : We maintain our BUY rating with a reduced Target price of Rs 255. In our overall calculation we have replaced the value of new projects (Rs 10.6/share) which were likely to be bagged in FY12E with Ahmedabad Vadodara project (Rs -6/share). At the same time the projects that were likely to be awarded in FY13E we have reduced our Equity IRR expectation from 18% to 16% which has led to correction in value of new project from Rs 9/share to Rs 3/share.

Lakshmi Machine Works : We maintain our rating on the stock at ACCUMULATE with revised price target of Rs 2,535, based on 9x FY13E core EPS of Rs203.4 and net cash of Rs1167 per share. In the wake of healthy order book and revenue visibility for next two years, we highlight that margin improvement would happen gradually. At CMP of 2126, LMW trades at 12.2x and 10.5x FY12/13E EPS of Rs174.1/ 203.4.

Mahindra Satyam : We raise our FY12/13E earnings by ~14.4%/10.3% to Rs 5/6.4 (V/s Rs 4.4/5.8 earlier) driven primarily by higher margin assumptions to 12.7%/13.7% (V/s 11.1%/12.5% earlier). We upgrade our rating to HOLD( V/s REDUCE earlier) with a revised TP of Rs 76(V/s Rs 65 earlier) however believe that a good March'11 quarter remains priced in and believe that further upsides in the stock hinge on consistent performance ahead.

BHEL : With prognosis for operating leverage and expansion in Ebidta margins being negated, we partially roll back earnings upgrades of FY12E. We cut FY12E earnings by 3.1% to Rs133.8/Share. We introduce FY13E earnings of Rs139.5/Share and earnings CAGR of mere 7% in FY11-13E period. With slowing earnings growth (FY11-13E) and depleting room for operating leverage combined with lack of strong catalyst- we scale down our target valuations for the company. We now peg BHEL valuations at 15-year Long-Term Average - and reduce rating from BUY to HOLD with target price of Rs 2150 per share.

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