S Ranganathan, LKP Shares and Sec is of the view that Salzer Electronics has target of Rs 130.
Ranganathan told CNBC-TV18, "Salzer Electronics is a small cap company with revenues of about Rs 60 crore. Again addressing a market size upwards of Rs 1000 crore catering to the electrical equipment with a supply to almost all the big names to the domestic market. What interesting is that the exports are also picking up; exports is now about 30% of their total revenues and their tie-up with Crompton Greaves putting them in state going forward."
He further added, "They also have a similar tie-up with L&T on the domestic front. So if you actually look at it we are quite excited at the fact that this is a scalable business model where most of the customers to which they cater to are seeing substantial volume intake and in our opinion this company has the ability to grow its revenues from Rs 60 crore to Rs 120 crore in the next two years. So we are seeing lot of topline growth coming in the next two years for this company and so does the bottomline, so valuations of course are extremely compelling. If you consider the way midcaps are behaving at this point of time, for the next one year we have a price target of about Rs 130 on this stock."
