Top Picks for Jan 2011: PINC Research

PINC Research has come out with a report on Power Picks for Jan 2011 in its January 17, 2011 research report.

Top-Shelf Selections-January 2011: Ashok Leyland: Our FY11 and FY12 earnings estimates are Rs 4.3 and Rs 5.5 respectively. Our FY12E earnings are 10% lower than consensus estimate of Rs 6.1. We have a 'BUY' recommendation on the stock with a target price of Rs 76, which discounts FY12E earnings by 14x. Bajaj Auto: Our FY11 and FY12 earnings estimates are Rs 88.8 and Rs 103.1 respectively. We have a 'BUY' recommendation on the stock with a target price of Rs 1855, discounting FY12E earnings at 18x. Our FY12 earnings estimate is 2.5% higher than consensus estimate of Rs 100.5. IRB Infra: Our FY11E and FY12E earnings estimates are at Rs 13.3 and Rs 13.3, lower 4.9% and 17.9% resp. then consensus estimates. We expect top line growth of 59.2% at Rs 27.1bn for FY11 and 48.7% at Rs 40.4 billion for FY12 vs consensus estimate of 58% at Rs 26.9 billion and 42.8% at Rs 38.5 billion. We believe recent stock price correction provides good entry point for long term investors with upside potential of 33.7% on our SOTP based target price of Rs 283 versus consensus target of Rs 289. Jagran Prakashan: Our revenue estimates vary from consensus by ~3%, mainly account of incorporation of Mid-Day numbers in FY12. Our Net margin forecast for FY12 which is 19% is in line with consensus. Our FY12 EPS estimate is 3% lower than the consensus. Target of Rs 165. Lupin: Our FY12 estimates are higher than consensus. We expect net sales and earnings CAGR of 20.6% and 26.2% to Rs 68,956 million and Rs 24.4 respectively over FY10-12. We value Lupin at 22x FY12E earnings (in line with sector biggies), which yields a target price of Rs 537. Mahindra and Mahindra (M&M): We expect EPS of Rs 44.5 and Rs 48.0 in FY11 and FY12 respectively. Our FY12 earnings estimate is 5.6% lower than consensus estimate of Rs 50.8. We value M&M using SOTP at Rs 900, discounting the standalone business at 15x FY12E earnings. NIIT Technologies: Our top-line estimates vary from consensus by ~4.8%, underpinned by stronger volumes and modest uptick in pricing for FY12. Our EBITDA margin estimate for FY12 is 20.6% which is in line with consensus. Our FY12 EPS estimate is 4.9% higher than consensus. Target of Rs 278. Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management.Moneycontrol.com advises users to check with certified experts before taking any investment decisions. To read the full report click on the attachment

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