Buy Jaiprakash Associates; target Rs 50: ICICIdirect.com
ICICIdirect.com is bullish on Jaiprakash Associates and has recommended buy rating on the stock with a price target of Rs 50 in its research report dated July 30, 2013.
July 30, 2013 / 18:58 IST
ICICIdirect.com's report on Jaiprakash Associates
"JAL's reported net profit in Q1FY14 was above our expectations on account of one-time profit of Rs 395.3 crore (pre-tax) from sale of shares of Jaypee Infratech during the quarter. However, the net profit after adjusting for profit on sale works out to Rs 24.8 crore (decline of 82% YoY). In the cement division, volumes grew 3.1% YoY to 3.7 MT while the realisation improved by Rs 90/tonne at Rs 4160/tonne and the EBITDA declined by Rs 55/tonne to Rs 884/tonne in Q1FY14. Going ahead, with the interest coverage ratio (0.9x in Q1FY14) – lowest in the last seven years, de-leveraging of balance sheet through asset monetisation is the need of the hour and would act as a key catalyst for the stock performance.""With the interest coverage ratio (0.9x in Q1FY14), lowest in the last seven years, de-leveraging of balance sheet through asset monetisation is the need of the hour and would act as key catalyst for the stock performance. We have assigned a BUY rating with an SOTP based target price of Rs 50 purely on the valuation (currently trading at 0.6x FY14E P/BV)," says ICICIdirect.com research report.Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies 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. 
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