Gaurang Shah of Geojit Financial Services is of the view that Gwalior Chemical Industries has target of Rs 125. It is the largest producer in India and number two in the world in the production of chlorinated compounds. It has around 80% market share in the domestic market.
Shah told CNBC-TV18, "We have seen encouraging performance from Gwalior Chemical Industries in the first quarter of ’09. It is the largest producer in India and number two in the world in the production of chlorinated compounds. It has around 80% market share in the domestic market. It operates through seven plants in two different locations in Madhya Pradesh and Gujarat. It has successfully completed the capex as phase-I. The expansion plan in phase-II is expected to be completed by June 2009."
He further added, "The kind of market share that it commands especially in perfume and dye chemicals area where there is a lot of potential for exports, we expect this particular counter to grow at least from the current levels of around Rs 90-92 with a price target of Rs 125. There is a lot of interest among FIIs and DIIs. I believe there is 20% holding among FIIs and DIIs, which make it a very attractive buy. This is not a stock that will give you movements every second or third day. But on an 18-month timeframe, I think you could easily see a target of Rs 125."
Disclosure: Analyst doesn't hold the above stock but has recommended it to clients.
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