Fedders Lloyd can give return of 50%: Tulsian

Fedders Lloyd can give a return of 50% in 8-12 months, says SP Tulsian, sptulsian.com.

Tulsian told CNBC-TV18, "Fedders Lloyd is a company that is providing turnkey air-conditioning solutions to defence, railway and commercial clients and apart from this they are selling the air conditioners. This company has their ending as June. If you see their first six months performance that has ended December 2010, the company has posted an EPS of close to Rs 7.20 on topline of about Rs 360 crore. In fact the second half of the air conditioner makers, we all knows that are always better and considering that I think they are likely to post an EPS of close to about Rs 16 for year ended 30 June, 2011 and that translates into PE multiple of about 5 times."

He further added, "If you compare it with Blue Star or Voltas or any other player like Hitachi Home Appliances, this share is quite undervalued. In the past maybe 6-8 months we have seen renewed interest coming back in this stock but then the profit booking has brought down the share to these levels. So at and EPS of Rs 16 with PE multiple of less than 5 and with growth in place which is likely to be seen for the next at least for 3 years from the company to the extent of about 22-25% on topline, bottomline, I see very limited risk downside and on the upside it can give a return of 50% in 8-12 months."