Two stocks Morgan Stanley says will rise in next 30 days

Morgan Stanley expects share prices of Bangalore-based Sobha Developers and private sector lender Yes Bank to rise in the coming 30 days. 

In a note dated March 28, the investment bank says "Sobha stock is down 20 percent from its recent peak two months back, and now trades at 11.5 times F14 expected EPS and a 40 percent discount to forward net asset value, which we believe are inexpensive valuations."

It adds that the property developer continues to steadily scale up new launches and is on track to meet its Rs 2,000 crore target in new sales for 2013.

Sobha shares were trading 0.80 percent lower at Rs 368 as on 15:47 p.m. The stock is up over 5 percent in the last three trading session.

Meanwhile, shares in Yes Bank gain 4.19 percent after Morgan Stanley said in a note that share price would rise relative to the country index over the next 30 days, citing improving liquidity conditions in the banking system and valuations, dealers say.

The investment bank said, "We expect wholesale funding institutions to do well, as funding costs reduce to Oct-Dec 2012 levels."

It says valuations for Yes Bank at 10 times FY14 earnings and 1.9 times book value are attractive and below historical average levels, providing a margin of safety, in its view.

Interestingly, Morgan Stanley sold 2,855,125 shares of Yes Bank at Rs 425.22 on the BSE on March 28.

Also Read: Yes Bank floats 100% subsidiary co, eyes acquisition

(With inputs Reuters)