Century Enka can move to Rs 260-270: Tulsian

Century Enka can move to Rs 260-270 in next four- six months time, says Investment Advisor, SP Tulsian.

Tulsian told CNBC-TV18, "Century Enka, manufactures polyester and nylon filaments yarns, they also make tyre cord fabrics. They have been contemplating an expansion of about Rs 300 crore and raising their capacity. They already have three plants, one at Mahad, Pune and Baruch. And if you see the financial performance, the company has an EPS of close to about Rs 27 for nine months with cash EPS of close of about Rs 48."
He further added, "This means that they have a topline of Rs 1,000 crore with cash profit of close to about Rs 100 crore. They should be able to post an annual cash profit of about Rs 100 crore which translates into a market cap of less than about may be Rs 400-430 crore."
"I am quite positive on the working of the company going ahead, including expectations of some corporate developments. The company will come into fold of Kumar Mangalam Birlas from the BK Birla group that will just be a formality within the family. But, going forward because the company will be completing their expansions, FY12 is likely to be very good. If you see the valuations it is ruling out at PE multiple of Rs 5 to less than Rs 5 and the cash PE multiple of less than Rs 3 on the historic earnings."
"Going forward, I don