GE Shipping may have 10-20% upside on demerger

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GE Shipping may have 10-20% upside on demerger

Vibhav Kapoor of IL&FS Investmart feels that GE Shipping may have 10-20% upside from here once the demerger happens.

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Excerpts from Your Stocks on CNBC-TV18 Watch the full show » ALSO READ See what other Experts & Brokerages are saying about GE Shipping See messages about GE Shipping GE Shipping BSE | NSE 28/05/12 Are Mutual Funds betting on GE Shipping?

Vibhav Kapoor of IL&FS Investmart feels that GE Shipping may have upside of 10-20% upside from here once the demerger happens.

Kapoor told CNBC-TV18, "There one really needs to wait for that demerger to happen in GE Shipping. It's been delay for long time. Obviously the shipping business is not doing do well now because freight rates have been coming down and are expected to remain soft going forward for the next 2-3 quarters. But the drilling business of course is a more stable cash flow business and that's going to continue to do well."

He further added, "Once the demerger happens as to how the new management or that segment of the management grows that business going forward. I think if you look at this sort of basic valuations there is probably an upside of 10-20% from here once the demerger happens. But that's all for the time being. Maybe one could look at investing in the drilling business separately when the demerger happens."

Disclosure: Analyst has small positions in Hindustan Lever and Great Eastern Shipping.