Moneycontrol
Get App
Last Updated : Aug 22, 2014 06:59 PM IST | Source: Moneycontrol.com

Sell SAIL; target of Rs 62: Emkay

Brokerage house Emkay Global Financial Services is bearish on Steel Authority of India (SAIL) and has recommended sell rating on the stock with a target price of Rs 62 in its August 13, 2014 research report.

 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Emkay's research report on Steel Authority of India (SAIL)


Substantial decline in tax expenses, owing to MAT credit, coupled with improved operational performance resulted in APAT of Rs 5.3 bn, up 17% QoQ and down 2% YoY


EBITDA stood at Rs 11.3 bn, higher than our estimate on negative stock adjustment and improved operational efficiency; EBITDA/ tn at Rs 4,100 (+11% YoY; +17.1% QoQ)

Close

Revenue at Rs 113.4 bn was in line with our estimates; Avg realizations rose 5%/ 6.5% on YoY/ QoQ, while volume came in line at 2.8 mt. The company holds 1.32 mt of inventory


While, higher volume is already priced in, significant improvement margins looks difficult


At the CMP of Rs 83, the stock trades at 10.2xFY16 EPS and 9.1xFY16 EV/EBITDA. Continue to value the stock at 5.5xFY16 EV/ EBITDA and giving 20% discount to the CWIP, the fair value comes at Rs 62/ share. Though, some signs of improvement has been there, it would be too early however to assume significant and sustained jump from here on both in terms of volume and margins. Maintain sell with a revised target price of Rs 62", says Emkay Global Financial Services research.


For all recommendations, click here

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.




Moneycontrol Ready Reckoner
Now that payment deadlines have been relaxed due to COVID-19, the Moneycontrol Ready Reckoner will help keep your date with insurance premiums, tax-saving investments and EMIs, among others.

Get best insights into Options Trading. Webinar by Mr. Vishal B Malkan is Live. Watch Now!

First Published on Aug 22, 2014 06:59 pm