Buy Shree Ganesh Jewellery; tgt Rs 138: Firstcall Research
Firstcall Research is bullish on Shree Ganesh Jewellery House and has recommended buy rating on the stock with a target price of Rs 138 in its January 16, 2013 research report.
January 18, 2013 / 14:34 IST
Firstcall Research is bullish on Shree Ganesh Jewellery House and has recommended buy rating on the stock with a target price of Rs 138 in its January 16, 2013 research report.
"Shree Ganesh Jewellery House is a leading manufacturer and exporter of handcrafted, machine-made gold jewellery. Shree Ganesh Jewellery House Ltd has a fresh Certificate of Incorporation to "Shree Ganesh Jewellery House (I) Limited". Shree Ganesh Jewellery House Ltd has demonstrated the results during the quarter; the growth of Net Profit stands up by 173.41% to Rs.588.10 million. Shree Ganesh Jewellery House Ltd signed and joint venture agreement to invest Rs. 50 crore in Jewellery Manufacturing Facility in Dhaka. During the quarter, the company has received “ECGC-D&B Indian Exporters' Excellence Awards” attributed to leading exporters of the country. During the quarter, Alex Astral Power Ltd, the Group Company, received Indian Industrial Excellence award organized by IEDRA towards one of the best PLF generating Company. Net Sales and operating profit of the company are expected to grow at a CAGR of 20% and 10% over 2011 to 2014E respectively.The company's net profit springs up to Rs.588.10 million against Rs.215.10 million in the corresponding quarter ending of previous year, an increase of 173.41%. Revenue for the quarter stands up by 96.80% to Rs.28865.40 million from Rs.14667.40 million, when compared with the prior year period. Reported earnings per share of the company stood at Rs.9.69 a share during the quarter, registering at 173.41% increase over previous year period. Profit before interest, depreciation and tax is Rs.1150.90 millions as against Rs.533.00 millions in the corresponding period of the previous year.At the current market price of Rs.122.00, the stock P/E ratio is at 2.30 x FY13E and 2.11 x FY14E respectively. Earning per share (EPS) of the company for the earnings for FY13E and FY14E is seen at Rs.53.10 and Rs.57.76 respectively. Net Sales and operating profit of the company are expected to grow at a CAGR of 20% and 10% over 2011 to 2014E respectively. On the basis of EV/EBITDA, the stock trades at 1.08 x for FY13E and 0.83 x for FY14E. Price to Book Value of the stock is expected to be at 0.45 x and 0.37 x respectively for FY13E and FY14E. The third quarter witnesses a healthy increase in overall sales as well as profitability on account of powerful combination of exciting products, an enhanced store network and robust infrastructural Support system. We expect that the company surplus scenario is likely to continue for the next three years, will keep its growth story in the coming quarters also. We recommend 'BUY' in this particular scrip with a target price of Rs 138 for Medium to Long term investment," says Firstcall Research report.
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