Invest Bharat Bijlee on dips: Aashish Tater

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Invest Bharat Bijlee on dips: Aashish Tater

Invest Bharat Bijlee on dips with a long term view, says Aashish Tater, Head of Research, Fort Share Broking.

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Excerpts from Bazaar on CNBC-TV18 Watch the full show » ALSO READ See previous views by Aashish Tater See what other Experts & Brokerages are saying about Bharat Bijlee See messages about Bharat Bijlee

Invest Bharat Bijlee on dips with a  long term view, says Aashish Tater, Head of Research, Fort Share Broking.

Tater told CNBC-TV18, "Bharat Bijlee is one stock which I would like to give some highlight for quarter one performance. The company has posted an EPS of Rs 48. This is because the company has shown an extraordinary income of close to Rs 26 crore. That means net-net the company has actually underperformed its last Q1 result. And thus we feel that with the Q2 announcement people will be disappointed and the stock should tend to those Rs 620-640 odd marks where we suggest that again you should from a longer term perspective be an investor into a company, which gives you a dividend of Rs 25 year-on-year."

He further added, "For next year we have a target of close to Rs 32 in terms of dividend for this particular stock because with this extraordinary income what we feel is this is because of they might have tended a part of the share of Siemens Holding in the open offer recently concluded by Siemens AG."

"If you look from balance sheet perspective the company is right now having a market cap of close to Rs 400 crore odd of which Rs 240 crore is invested into blue chip companies like ICICI, Hind Oil, HDFC and Siemens. Of which if I take a 60% value of the market cap, I think it would be roughly around Rs 150 crore odd. They are sitting on handsome cash of close to Rs 25 crore odd levels after Q1, plus they are sitting on Rs 18-20 crore of mutual fund. So if I reduced all these aspects, the company is available at Rs 180 crore odd."

"There are two catch. One, the people would be disappointed after Q2 results because of industry is having problem and then the stock would tend to that Rs 620-640 odd mark where if I see from a PE multiple perspective the residual business will be available close to 4.5-5 times. So from two to two and a half years perspective once these kind of business again would be into the limelight, they can expand their PE to 15-16 odd times and then again Bharat Bijlee would be an outperformer. So if someone wants to take an investment call let it relax to that Rs 620-640 odd mark and take a call from a longer term perspective for an Rs 1,000 plus target from two and a half years perspective."