Sandeep Nanda of Sharekhan is of the view that SKF has target of Rs 406.
Nanda told CNBC-TV18, "We like SKF and we have target of Rs 406 on this stock. It is a leader in the bearing industry and there are three-four things, which are going to drive growth hereon. First of all the company has expansion plan, the first stage of which is just got completed, so we will see that through this year. Secondly they are going to continue with the expansions in 2007 and 2008."
He further added, "Thirdly, because the plants have just come on stream we will see margin expansion as the capacity gets ramped up. They are introducing a number of new products and services from their parent's portfolio and there is also going to be outsourcing to the parent. Rs 406 is a one year target and at this price not only it is pretty attractive but it's also got lot about 35-40% earnings growth next couple of years. So that's why we like it."
