Buy MIC Electronics; target Rs 53: Firstcall Research

"At the current market price of the stock Rs.42.90, the stock trades at a P/E of 5.51 x and 4.74 x for FY10E and FY11E respectively. The EPS of the stock is expected to be at Rs.7.79 and Rs.9.05 for the earnings of FY10E and FY11E respectively. On the basis of EV/EBDITA, the stock trades at 4.93x and 4.91x for FY10E and FY11E respectively.

Price to Book Value of the stock is expected to be at 1.16x for FY09E and 0.93x for FY10E. MIC Electronics Ltd bagged a 3 year long contract to supply video screen with Parramatta Eels National Ruby Club through their alliance with Sequity Pty Ltd. MIC electronics recently introduces three new products that would introduce soon in India. These products have been designed around semiconductor devices form Texas Instruments(TI) including OMAP, MSP 430 and 16 channel LED Driver.

MIC in joint venture with Hyperion Green Energy India Pvt Ltd has secured the Rajahmundry Energy saving project for municipal street lighting. The company is looking opportunities in other segments like sports, billboards and information display. The company which is executing some works for railways currently is expecting the biggest ever LED contacts shortly from Indian Railways.

The company launches solar LEDs for rural areas which are yet to be connected to the power grids. These LEDs are cost effective and high performance oriented. MIC received purchase orders worth Rs.14.15 Crores. We recommend a “BUY” on the stock with a target price of Rs.53.00 for medium to long term, “says Firstcall Research report.

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