Sterlite Tech has target of Rs 400-450: Choksey

Excerpts from Markets Midday on CNBC-TV18 Watch the full show » ALSO READ See previous views by Deven Choksey See what other Experts & Brokerages are saying about Sterlite Optic See messages about Sterlite Optic Sterlite Techno BSE | NSE 10/02/12 Are Mutual Funds betting on Sterlite Techno?

Sterlite Technologies has target of Rs 400-450, says Deven Choksey , KR Choksey Securities.

Choksey told CNBC-TV18, "In Sterlite Technologies, the important aspect is that it has a very strong play in telecommunications as well as in power. In telecommunications they are among the largest manufacturers in the world as far as optic fibre is concerned and optic fibre capacity is substantially being increased at this point of time by Sterlite Technologies. Along with that they have the power conductor business, aluminum conductor business, which they supply to transmission and distribution business. There also the capacity is being expanded from about 1,60,000 tonne to about 2 lakh tonne and they are holding about 25% market share in this particular space. So you find this company positioning very well into this space."

He further added, "On the valuation front, you will find that the company is attractively placed against estimated earnings per share of about 30 for FY10, the stock is available at around Rs 300-310 which is around 10 times kind of forward earnings next few months. I think the company is looking - a growth phase in which they are already entered into, it is looking quite positioned for growing atleast around 25% on a CAGR basis even after this year. So we like this company from investment perspective with a target of around Rs 400-450 which is possible in next one year's time."

Disclosure: It is safe to assume that we have got the investment position in the above company in personal capacity, many of our clients are also having positions in this company. We have research coverage as well on the company.